During the week (Dec 15, 2014-Dec 19, 2014), the Bombay Stock Exchange (BSE) Sensex ended with cumulative gains of 21 points or 0.08% at 27,353 points. Trading during the week was marked with high volatility with Monday being range bound and closing 31 points lower. On Tuesday it fell by 538 points to 26,823 points and after volatile intra-day trading, it slipped a further 71 points on Wednesday. The tide then changed on Thursday with the Sensex gaining 416 points, while on Friday it registered a further gain of 245 points.
The global markets turned positive after the US Federal Reserve meet, which issued a statement giving hints that the rate increase may take longer. On the domestic front, the Cabinet nod to GST Bill raised hopes of reforms in 2015. The landmark tax reform is expected to reduce logistical costs and simplify tax structure for manufacturers.
The government also released the approach paper on coal block auctions. On the fiscal side, the government said that meeting its 2014/15 fiscal deficit target of 4.1 per cent would be challenging.
On the global front, Brent crude continued to remain weak and closed around the $60-level.
Among the A group companies, the top gainers during the week were KPIT Technologies (12.13%), Gujarat Gas (10.83%), Jaypee Infratech (10.61%), Amara Raja Battery (10.28%) and Atul Auto ( 9.32%). Meanwhile, the top losers were PMC Fincorp (-48.01%); Rasoya Proteins (-27.89%); DLF (-17.50%) and Vakrangee (-17.46%).
On Friday, shares of ICICI Bank and Reliance Industries, up 2 per cent each, were major contributors to the gains in Sensex. Wipro, Hero Motocorp, Coal India, Sesa Sterlite, NTPC, Hindalco Industries and Tata Power gained 2-3 per cent.
Till December 19, 2014, the FIIs have been net buyers in equity and debt with Rs 1,792.70 crore and Rs 9,556.36 crore of buying respectively. Meanwhile, MFs have brought Rs 2,362.20 crore of equity and Rs 26,962 crore of debt, more than twice the FII purchases.
Though there was great relief in the market after the Federal Reserve announcement but not everyone agrees to it. Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services says, "The truth is that global risk continue, especially to Europe and Oil countries as the end structure of which is still evolving. As far as oil goes, it will be beneficiary to India in the medium term, but market need to know the actual cause & effect.
There is a high amount of doubt as world is slowing down and many important countries like Euro, OPEC, China and Russia are in structural issue. All said liquidity continue to be fair and moving up in expectation of QE from ECB in the mean time GST has come as a surprise development of winter session."