Markets Hail Saffron Sweep

Stock markets are in a merry mood and betting big on Narendra Modi and the BJPs coming to power. Even before the declaration of the results of four states assembly elections on December 8, markets had taken it for granted that the saffron party will sweep through these. As expected, mandate in three states evolved just like that. Since the result day, markets have remained into a firm grip of bulls and continued to hover above the 21000 mark. It shows the strength it has gained after the assembly elections. In fact the Sensex touched its all time high mark of 21483 points on December 9. Still at the present levels retail investors are yet to party as their stocks are much below the levels at which they have purchased them. On the other hand the present levels are not really appropriate for them to enter into the markets.

The Sensex opened strong at 20449 points on November 27 and since then has gained momentum continuously to touch its peak of 21483 points on December 9, before closing at 21255 points on December 10. Overall it gained 806 points over the fortnight. The best part of the fortnight was that the Sensex were at its lowest level of 20348 points on the first day (November 27) but hasn’t looked back since then. The NSE Nifty too opened at 6062 points on November 27 and touched its lowest level of 6030 points on the same day, but gained momentum thereafter to touch its highest level of 6415 points before closing at 6332 points, gaining 338 points during the fortnight.

FIIs showed full confidence in the Indian stock market buying a net Rs 6904 crore worth of equities. For a change, Indian Mutual funds too looked positive with a net purchase of Rs 178 crore worth of equities during the fortnight. The combined turnover of the NSE and the BSE was between Rs 12257 crore and Rs 15470 crore.

Global indices moved according to the internal pressures faced by individual economies. The US Dow showed some kind of traction and marginally shed 0.30 per cent on the heels of domestic cues. Biggest gainer of the fortnight was the Taiwan Weighted having gone up 1.89 per cent followed by China’s Shanghai Composite, Japan’s Nikkei and Hong Kong’s Hang Seng which rose 1.69 per cent, 1.53 per cent and 0.66 per cent respectively. On the other hand, Singapore’s STI was the biggest loser with a 1.94 per cent drop, followed by UK’s FTSE, Germany’s DAX and South Korea’s Seoul Composite with a 1.22 per cent, 1.16 per cent and 0.79 per cent decline respectively.

Individually, of the total stocks, 1845 appreciated during the trading sessions and 723 stocks tumbled. 37 stocks remained unchanged. As far as the individual gainers are concerned, Oriental Bank was the biggest gainer with a 23.97 per cent jump followed by Jaiprakash Associates, Dish TV, Indian Hotels and Adani Enterprises with a 18.39 per cent, 17.62 per cent, 15.51 per cent and 15.58 per cent rise respectively. On the other hand Strides Arcolab was the biggest loser with a 11.12 per cent decline followed by MCX, Wockhardt, Nestle and Financial Technologies, which declined 9 per cent, 8.27 per cent, 7.73 per cent and 7.26 per cent respectively.

Considering the present mood of the markets it seems likely that with in few days some profit booking may come. Also, as the chant of Modi for PM becomes louder (read the Editorial on Page 4) the markets would certainly gain momentum. Considering this, it is advisable to book at least part of the profit. After all, a bird in hand is worth two in the bush.