Benchmark stock indices traded near all-time highs during the week. The BSE Sensex opened the week at 26,733.18, touched a record high of 27,225 points on Wednesday and closed the week at 27,026. It rose 293 points or 1.1% during the week. The Nifty opened the week at 7,990, touched a high of 8,141 and closed at 8,086 points, up 96 points or 1.2%.
Consumer goods, health care and IT stocks were the top performers. The FMCG index was the only sector index that closed in the red. The BSE Consumer Goods index rose 3.02% to 15,420.9. It was followed by BSE IT (2.92% to 10,405) and BSE Healthcare indices (2.62% to 13,760).
In the BSE 500 index, Abbott India, Motherson Sumi, Bharti Infratel, UPL Ltd, Jyothy Laboratories, Kaveri Seed Company, Tech Mahindra, Tata Consultancy Services and Glenmark Pharmaceuticals touched all-time highs during the week.
Foreign institutional investors , or FIIs, remained net buyers for another week. Their net investment stood at Rs 3,972 crore.
Rakesh Goyal, senior vice president, Bonanza Portfolio, says, "The market looks positive. Trade positions, market activity, derivatives positions and sentiment indicate healthy movement in the coming week. The Ukraine crisis is about to get resolved, which is a positive. We expect markets to remain upbeat and FII flows to continue."
The Sensex fell 113 points on Thursday and Friday. Vikram Dhawan, director, Equentis Capital, says, "In spite of steady flow of positive news, both locally and globally, broad indices appear to be losing momentum. This usually happens when markets are either hugely overbought or when big-ticket buying tapers off. A steep correction is not envisaged at this point in time, though we may be entering a phase of procrastinated time correction."
The HSBC India manufacturing purchasing managers' index data fell to 52.4 in August from 53 in July, showing moderation in manufacturing activity. The HSBC/Markit purchasing managers index for services fell to 50.6 compared to 52.2 in July, again indicating a slowdown. A reading above 50 indicates growth.
At the same time, the HSBC composite output index stood at 51.6 in August, down from 53 in July, showing slowing output growth across the private sector.
Crude oil is still weak. Alex Mathews, head of research, Geojit BNP Paribas Financial Services, says, "Crude oil is likely to test $92 levels in the near term and even fall below this crucial support level. The key reasons are higher production, lower demand and strong dollar."
The major events to watch out for in the coming week are the release of inflation, industrial production and manufacturing numbers.