Performance Of The Indian Stock Market For The Week Ending 9 August 2013

The indices of the Indian Stock Market toppled again for the week ending 9 August 2013 with an overall loss of 2%, when no positive trigger has been observed throughout the week. In the absence of any sign of improvement, rupee also fell to touch down another lower value.

The market experienced an important event during this week, when Raghuram Rajan was announced as the new Governor of RBI. The news of the new Governor came in as a surprise, which has to take care of important tasks ahead related to the Indian economy including the improvement of the economic growth, stabilization of the Rupee value and control of the inflation rate.

Global Effect

The equity market at global level has influenced a downfall during the week with Nikkei from Japan taking the strongest fall of about 5.95%. The improving streak of the US economy also crashed due to the fear of shrinkage of QE3.0 by Fed earlier than when it is expected for.

European markets released the macroeconomic data showing manufacturing activity’s improvement during the week, however, the equity market here showed concern for liquidity conditions and ignored the macro data released. GDP for Italian economy showed a lower shrinkage than expected, while factory orders in Germany have also experienced an improvement during the week.

A rise has been marked in the manufacturing activity for the industrial production in the UK, while the Bank of England revealed the tie up of interest rates and unemployment index, after which interest rates will be totally dependent on the rate of employment.

Performance of Different Sectors in the Market

As far as indices of different sectors are concerned, PSUs, Realty and Metal are the only sectors that have experienced a gain during this week at the rate of 1.09%, 2.97% and 5.31% respectively. The greatest downfall was experienced by the Capital Goods section with a drop off above 6% during the week, while defensive sectors also experienced a collapse, when Pharma and FMCG indices fell over 2% during the week. Auto sector experienced a weakness of about 1.23% during the week, where numbers of TATA motors had experienced a downfall in their profit by 24%, which remained unstable during the complete week.

The shares of Ranbaxy showed a surprising surge of 36% after the announcement of land allocation in Malaysia by the company. The numbers of the company are now eyed for a chronological improvement in future.

The trading ban on NSEL affected the financial technology sector, while MCX shares suffered a downfall consecutively for another week. Tata Power and BHEL also suffered with crash of shares. Despite a little positive trading, Wockhardt also remained in the lower belt for maximum duration of the week.

Conclusion and Future Anticipation

The PMI numbers for India’s Services entered in at a lower value than expected, while the whole data haven’t shown a cutback till now since 2009 indicating a pressure on services sector also. The session termed as earnings season for the market showed a gradual disappointment, while no positive triggers are being expected when the closure of this season is approaching near. So, the instability of the market is expected for the next week also.