It was a cautious and a slightly negative start for equities on the major Indian bourses last week (28 April - 2 May, 2008) as participants were reluctant to build up positions ahead of announcement of credit policy by the Reserve Bank of India.
As a few blue chip stocks declined sharply, the Sensex went down by over 100 points that day. But, the bulls staged a telling comeback on Tuesday after the apex bank left the repo and reverse repo rates unchanged even as it hiked the cash reserve ratio by 25 basis points. Led by bank stocks, equities rallied smartly that afternoon and lifted the Sensex up by 363 points.
Price movements remained extremely choppy on Wednesday as investors turned cautious again. This time around, they appeared reluctant to lap up stocks ahead of the US Federal Reserve meet. While the Sensex lost around 90 points, the Nifty eased by 26 points in that session.
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The 25 basis points cut in US interest rates triggered a strong rally on Wall Street on Thursday and with Asian markets also surging higher on Friday morning, the bulls had their way at the Indian ring on the final session of the week. Staying firm right through the session, they lifted the Sensex and Nifty by 313 points and 62 points respectively.
Though inflation rose 7.53%, a 42-month high, firm global trend, fairly strong results from some top notch companies and a slew of stock specific stories kept the mood buoyant on Friday. Information technology stocks were among the significant contributors to the market's rise last week. The decision of the government to extend tax exemption till 2010 for export driven software companies triggered hectic buying in the IT space.
While the Sensex gained 474.14 points or 2.77% to 17,600.12, in the week ended Friday, 2 May 2008, the Nifty moved up by 116.50 points or 2.27% to 5228.20.
Mirroring some strong buying in the midcap space, the BSE Midcap jumped 181.26 points or 2.56% to 7,237.47 in the week. The BSE SmallCap index posted a gain of 93.99 points or 1.07%.
Jaiprakash Associates vaulted nearly 17% last week on strong quarterly results. Reliance Energy notched up a handsome gain of 12.1%. Automobile majors Mahindra & Mahindra, Tata Motors and Maruti Suzuki moved up by 8.6%, 8% and 6.9% respectively.
IT heavyweights Satyam Computer Services (11.1%), Wipro (7.7%), Infosys Technologies (6.1%) and Tata Consultancy Services (5.7%) ended the week on a high note.
Realty stock DLF surged 7.8%. Larsen & Toubro posted a sharp gain of 5.7%. NTPC and State Bank of India gained more than 4%. ITC, HDFC, HDFC Bank, BHEL, ICICI Bank and Reliance Industries also closed on a firm note. Ranbaxy Laboratories edged up marginally.
HCL Technologies (13.9%) was the top gainer from the Nifty fold. Unitech moved up by over 10%. Tata Power, Hero Honda, Power Grid, SAIL, BPCL and Sun Pharmaceuticals also ended on a firm note. Zee Entertainment, Idea Cellular and Tata Communications posted marginal gains.
Grasim Industries (down 10.6%) declined on severe selling pressure. Cipla lost a little over 5%. ACC eased by 3.7%. Bharti Airtel, Reliance Communications, Hindalco, Ambuja Cements and ONGC lost 1% - 3%. Tata Steel and Hindustan Unilever ended weak. Nifty stocks Siemens, ABB, Punjab National Bank, Cairn India, Nalco and Sterlite Industries closed on a weak note as well.
Among the sectoral indices, BSE IT advanced by 7.3% last week. Reflecting investor interest for realty stocks, the Realty barometer ended stronger by nearly 7%. The Auto index surged 5.6%. BSE PSU moved up by 4.3% while the Bankex jumped 3.1%. The FMCG, Power, Healthcare and Oil & Gas indices also ended with sharp gains.
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