Less Pain, Some Gains This Week

DSIJ Intelligence / 04 Oct 2013

Less Pain, Some Gains This Week

The benchmark Indian indices saw flattish movement during the week majorly owing to global events. The Sensex and the Nifty closed the week with gains of 0.89% and 1.27% respectively.

The benchmark Indian indices saw flattish movement during the week majorly owing to global events. The Sensex and the Nifty closed the week with gains of 0.89% and 1.27% respectively.

Major Indices
Index4-Oct-1327-Sep-13% Change
SENSEX 19,902.07 19,727.27 0.89
NIFTY 5,907.30 5,833.20 1.27
Hang Seng 23,138.54 23,207.04 -0.3
Nikkei 14,024.31 14,760.07 -4.98
Shanghai 2,174.66 2,160.03 0.68
Dow Jones 14,996.48 15,328.30 -2.16
S&P 500 1,678.66 1,698.67 -1.18
NASDAQ 3,774.34 3,787.43 -0.35
Bovespa 52,489.86 53,782.97 -2.4
FTSE 6,455.13 6,509.24 -0.83
DAX 8,596.86 8,633.11 -0.42
CAC 4,151.10 4,179.24 -0.67
Auto sales numbers for the month of September 2013 have been on the mixed side. Maruti Suzuki, the leading car maker in India has posted impressive numbers, with its total car sales rising by 12% to 104964 units in September 2013 as against 93988 units in the same period of the previous year. As for Tata Motors, its sales volumes were under pressure, and the total sales dropped by 33% to 50427 units compared to 75773 units YoY. Mahindra & Mahindra has also witnessed a decline in its overall sales volumes by 10% on a yearly basis to 43289 units during the month. The total sales of the company's tractors rose by 33% to 20085 units - domestic sales growing 37% to 18908 but exports dropping by 39%.

In the two-wheelers segment, Hero MotoCorp reported impressive growth of 15% to 468670 units in September 2013 as against 404787 units of the previous year. Bajaj Auto saw the second highest total sales ever of the month of September, up by 2% to 367815 units. It also reported the highest ever exports for September in any year, which improved by 10% to 146847 units. As for TVS Motor, its total sales volumes improved by 15% to 189609 units on a YoY basis for September 2013.

On another significant front, the CAD (the difference between spending overseas and earnings) figure for the June 2013 quarter widened to 4.9% of the GDP from 3.6% in the March quarter. In absolute terms, this stood at USD 21.8 billion, up from USD 18.1 billion in March 2013. While the numbers remain higher than the comfort levels, the positive aspect is that it has come in lower than the consensus estimate of USD 23 billion. The rising Current Account Deficit (CAD) has been the primary worry for the Indian markets for some time now. The Indian government has taken various steps like curbing gold imports and trying to increase the exports by incentivising exporters to bring this under control.

The last two days have also seen positive news flows for the Indian equity markets. However, the Services PMI report that came on October 3 seems to have brought a halt to that spell. The HSBC Services Purchasing Managers' Index (PMI) compiled by Markit slipped from 47.6 in August to 44.6 in September. This rounded off the worst quarter for the Indian services sector in more than four years, stoking fears that growth in the three months to September will be weaker than April through June. It marked the straight third reading below 50, the threshold between growth and contraction, and is the weakest since April 2009. The figures also indicate that firms were less optimistic about the future and were cutting down on their staff numbers as new business dried up, which suggests that the Indian markets are not completely out of the doldrums yet. 

Sectoral Indices
Category/Index4-Oct-1327-Sep-13% Change
 
MIDCAP 5731.01 5621.77 1.94
SMLCAP 5565.54 5496.88 1.25
BSE-100 5891 5816.49 1.28
BSE-200 2345.58 2316.13 1.27
BSE-500 7210.2 7155.27 0.77
Sectoral Indices
AUTO 11466.75 11161.7 2.73
BANKEX 11611 11284.26 2.9
CD 5912.77 5828.61 1.44
CG 8005.49 7938.48 0.84
FMCG 6798.73 6925.71 -1.83
HC 9572.95 9472.27 1.06
IT 8021.65 7834.89 2.38
METAL 8729.94 8580.67 1.74
OIL & GAS 8403.91 8362.12 0.5
POWER 1529.97 1546.94 -1.1
PSU 5539.33 5562.35 -0.41
REALTY 1245.95 1195.32 4.24
TECK 4549.24 4458.6 2.03
The broader markets closed the week on a positive note. The BSE Mid-Caps closed with a gain of 1.94%, while Small-Caps closed higher by 1.23%. On a sectoral basis, 10 of the 13 indices closed the week in negatives.

The next week will see the results for the Q2FY14 beginning to stream in. Hence, the likelihood of volatility depending on the financial results of the company cannot be ruled out.


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