Previous Week : BSE Sensex closed at 19663.64 down by 0.60%, while the NSE Nifty closed at 6016.15, down by 1.07%.
The Indian equity benchmark traded in a narrow range with negative bias and high volatility during previous week. The benchmark indices has turned sluggish after a strong up move in the first week of 2013 following the US fiscal cliff deal, as the sentiment has turned cautious ahead of Monthly inflation data, quarterly earnings and RBI's policy meet later in the month. The markets are likely to look for further directional cues from these key events in the short-term.
  • The 30 share BSE Sensex closed at 19663.64 down by 120.40 points or 0.60%, while the NSE Nifty closed at 6016.15, down by 64.85 points or 1.07%, week on week basis
  • Cement stocks (ACC, Ambuja, and Grasim), Metals stocks (Tata Steel, Hindalco) and capital goods stocks (BHEL, L&T) where the key draggers amongst Nifty constituents where as Tata Motors and IT stocks (Infosys Technology, Wipro, and HCL Technology) were the major gainers in the index
  • Earlier during the week, Fitch Ratings reiterated its 'negative' outlook on India's sovereign credit rating, citing concerns about slowing economic growth, persistent inflationary pressures and an uncertain fiscal outlook
  • However, during the latter part of the week positive sentiment was created when government officials told reporters a long-awaited proposal to raise diesel prices would be submitted to the federal cabinet
  • Among the Sensex companies, Infosys announced its results which were better than expectations
  • Brent crude closed at $111.79/barrel falling marginally on a weekly basis (as on Thursday)

Week Ahead : FIIs were net buyers to the tune of 7283 crore
Nifty on the weekly chart has formed a bearish Dark cloud cover candlestick pattern with a shaven top. It indicates change of trend in immediate term if the price action weakens below the bullish gap up area of 1st January 1, 2012 (5940-5919). Nifty during previous week traded in a 100 points range with a negative bias through out the week. Shaven candle head suggests stiff resistance in the zone of 6020-6042.
  • Weakness and close below the bullish rising gap area will see the index re-visit the lower band of medium term rising channel currently placed around 5800-5820 region
  • On the higher side a strong close above the previous week high of 6042 is required for further upside, which can lead the bulls eventually gear up for a move towards the 6150-6180 region being the upper band of the medium term rising channel in place since June 2012 and 100% price extension with the November-December 2012 up-leg
  • In the month of January (till January 10), FIIs were net buyers to the tune of 7283 crore while DIIs were net sellers to the tune of 5436 crore
  • Among the Sensex companies, Reliance Industries, TCS, Wipro and HDFC Bank are expected to announce their results in the coming week
  • Key data/events in the coming week include inflation data (WPI index) in India
  • Overseas, the markets would be looking out for initial jobless claims, MBA mortgage applications, Industrial production and CPI data in the US and CPI data in the Eurozone.