Previous Week : Sensex settled at 17373.84, while the NSE Nifty closed at 5290.85
Equity benchmark indices traded with high volatility in a narrow range with positive bias during last week trade. The Nifty managed to close in green in four out of the five trading days in previous week. The RBI on Tuesday cut interest rates for the first time in three years by a sharper-than-expected 50 basis points to give a boost to flagging economic growth. It left the CRR unchanged.
  • The BSE Sensex settled at 17373.84 up 279.33 points or 1.6%, while the NSE Nifty closed at 5290.85, up by 83.40 points or 1.6% for the week
  • Auto stocks (Tata Motors, Maruti, Bajaj Auto, and Mahindra & Mahindra), Coal India, HDFC Bank and ITC were the major gainers in the index. Where as BHEL, IDFC and Reliance Industries were the major losers in the index
  • The Wholesale Price Index (WPI) moderated to 6.89% in March 2012 from 9.68% in March 2011
  • Manufactured goods inflation, which has the highest weightage (64.97%), came down sharply to 4.87% while primary articles inflation started rising from -0.5% to 9.62%
  • Sequentially, the WPI index rose 0.88% led by over a 2% rise in prices of primary articles. The trend of upward revision of provisional figures continued. January 2011 inflation was revised upwards to 6.89%from 6.55% provisional. Retail CPI for the month of March increased to 9.47% v/s 8.89% (February)
  • The RBI surprised the market with a repo rate cut of 50 bps to 8%. However, the central bank indicated that future rate cuts may be limited due to upside risks in inflation
  • GDP growth target for FY13 was projected at 7.3%. Also, FY12 growth is expected to be 7%
  • The path of inflation in FY13 could remain sticky around current levels due to high oil prices, large suppressed inflation, exchange rate pass-through, impact of freight and tax hikes, wage pressure and structural impediments to supply response. Inflation is expected to be 6.5% for FY13
  • Amongst earnings, HDFC, Hindustan Zinc, ACC (adjusted for one offs) and HCL Tech result were in line our estimates whereas Ambuja Cement results were above expectations
  • Nymex crude was flat closing at US$102/ barrel gaining 0.54% on a weekly basis (as on Thursday)

Week Ahead - New home sales would be the key event to be watched
The Nifty continues to trade in the broad range of 5150-5380 and only a breakout in any side will decide the trend for future course of action. Nifty in the range of 5340-5380 has multiple resistances being the confluence of the 50 DMA, the bearish Island Reversal gap area and the previous top in the daily chart. A strong close above 5380 will lead to a shift of momentum in favour of bulls for a move towards 5500 or higher levels.Failure to do so may see continuance of broad range bound trades in the near term. The 200 DMA currently at 5140 has provided cushion on the downside in the recent corrective decline.
  • In April 2012, (till April 19, 2012), FIIs and DIIs were net sellers to the tune of 96 crore and 222 crores (provisional data)
  • Key data to watch globally would be new home sales, MBA Mortgage applications, GDP FOMC rate decision
  • In India, events to watch would be monthly inflation (WPI) and Monthly F&O expiry on Thursday
  • Key results to watch out next week would be Sesa Goa, Sterlite Inds, JSPL, Tech Majors TCS, Wipro, Banking majors Axis Bank, ICICI Bank, UltraTech Cement and Maruti Suzuki