The broader market represented by the BSE Sensex opened for the week at 25,108 and closed flat at 25,099, a fall of just 9 points. Similarly, Nifty opened at 7,514 and closed at 7,508.
While the Mid Cap index once again outdid the broader markets by gaining 2 per cent, from 8,985 at the beginning of the week to 9,200 levels and the Small Cap index gaining 2 per cent as well.
The markets have bounced back over previous week's range as the Iraq crisis and the resultant fears over supply of crude oil tamed down. Domestic institutions continued to remain net buyers in equities for the week. Foreign institutional investors continued to sell in spite of improved sentiments, but turned net buyers towards the end of the week.
Among the sectoral indices, S&P BSE Healthcare was the best performing index for the week as it delivered a return of 4.09%. It rose 442 points closing the week at 11,260. BSE Oil and Gas index, which was the worst-performing index last week, remained in negative territory as it lost 1.11% while the BSE FMCG index turned out to be the worst-performing index for this week. The index lost 3.15% during the week closing at 3.15%.
The top gainers for the week among Group A stocks were Gujarat State Petronet (+13%), Bharat Electronics (+12%), Titan Company (12%), Future Retail (+11%) and IRB Infra (+10%). While the top losers amongst group A companies were United Spirits (-11%), Kotak Mahindra Bank (-10%), Idea Cellular (-9%), Adani Enterprises (-9%) and Mphasis Ltd (-8%).Experts believe that quick policy decisions by the new government are providing good support to sentiments to both domestic and global market participants. "In the week, the government announced clearing of road projects worth Rs 40,000 crore which was a big boost to the realty space", says Rakesh Goyal, Senior Vice President, Bonanza Portfolio.
Further, the finance ministry showed its intention to allow retirement and gratuity funds to invest up to 30% of their corpus into equities. The new government also extended excise duty concession for the automobile and consumer durables sectors by six months to December 31, hereby giving a short-term boost to the auto sector. "Further, the new government also took a very crucial step to curb higher exports and increase domestic supply of potatoes, a big plus for the lower inflation numbers over the long term", adds Goyal.
On the Futures & Options side, the expiry for the month of June series saw the Nifty gain nearly 3.5 per cent; most of the gains were seen in the early part of the month. According to Sahaj Agrawal, Deputy Vice President-Derivatives Research, Kotak Securities, as we enter the July series, volatility is expected to remain high on account of the Union Budget.
While he remains positive on the broader market with immediate support seen at 7,400-7,450, on the higher side 7,700-7,800 is expected in the early part of the July series. Among the sectors, he is positive on are metals, IT, FMCG and select high beta stocks. A breach of 7,400 can invite significant selling pressure, Agrawal feels.
Precious metals - gold and silver - remained range-bound during the week and were seen to be out of favour with low volumes vis-a-vis previous week. Gold for instance moved up by Rs 25 per 10 grams to Rs 1,317. The picture on the Iraq crisis is still unclear and could present uncertainty for the markets.