Weekly Wrap-Up - November 17, 2012 - Eastern Financiers

The abridged trading week that witnessed the auspicious Muhurat trading session which marked initiation of the new Samvat 2069, culminated the week clocking loss of about two percentage point. Apprehensions over the global economic growth led by budget standoff in the world's largest economy and the geo-political tensions in Middle East along with bleak Industrial growth back home that slipped in the negative terrain dented the overall sentiment of the markets this week. However, the WPI for the month of October 2012 slightly edged lower amid anticipation of a trek which may be attributed to the easing inflation in food articles as well as components of core inflation. Foreign Investors sustained to pour in funds to the Indian economy.

The propitious 75 minutes special Muhurat trading that is attached with the sentimental value of buying during the fortunate day, ended the session on a murky note in the negative terrain led by profit booking rather than buying.

Despite of the surge in core industries data that has 37.9% weightage in the IIP Index, the growth for the month of September 2012 sharply slipped down to the negative figure of (0.4)% which was an utter disappointment and made the chief of PMEAC, Dr. C Rangarajan sound cautious. He said, "the September IIP number was a disappointing figure, particularly when the August industrial production rate showed a pick-up. He said the government had initially estimated FY13 GDP growth rate at over 6.5% and later scaled it down to 6%, but now it can be in the region of 5.5%". He hoped inflation may decline December onwards." IIP Growth for the month of October has been revised downward to 2.3% from the provisional figure of 2.7%.

Monthly WPI for the month of October 2012 surprised positively by parking a little below the 7.5% mark at 7.45% equated to 7.81% during September 2012 and 9.87% in the corresponding period of the previous year. However, there is high probability of the number being revised upward in the coming months. Inflation for August 2012 has been revised upwards to 8.01%, the highest in eight months from 7.55% reported earlier.

Telecom stocks were in limelight following muted response to the recently concluded 2G auction which fetched the government Rs 9400 crore from an auction that ended on its second day against target of Rs 40000 crore. Four telecom zones including the expensive Delhi and Mumbai circles, saw no demand. The government plans to put on auction the circles that went without bids by March 31, Telecom Minister Kapil Sibal said.

Foreign funds sustained to invest in the Indian markets this week to the tune of Rs. 767.80 crores after prior week's inflow of Rs. 1159.35 crores.

Source : Equity Bulls

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