Sensex logs second weekly gain as India outperforms peers
Sunday, 6 June 2010
MUMBAI, June 5 (Reuters): The benchmark index of the Bombay Stock Exchange (BSE), the Sensex, logged its second straight weekly gain, as it climbed 0.6 per cent Friday, helped by a rise in European markets, but market participants were not convinced if risk appetite had revived as yet. Financials led the gains on optimistic long-term outlook in an advancing economy.
The 30-share BSE index closed 0.56 per cent, or 95.36 points, higher at 17,117.69 points, and logged a 1.5 per cent gain for the week. Nineteen of its components advanced. "Risk appetite has not yet returned.
Europe issues are still far from resolved," said Arun Kejriwal, director of research firm KRIS. "We may continue to see selling pressure from foreign institutional investors (FIIs)."
The benchmark had dropped 3.5 per cent in May, its first monthly decline after January, as foreign funds pulled out $2 billion from Indian equities. They have already sold around $123 million in the first two sessions of June.
However, Indian markets have performed better than their peers. BSE Sensex has lost only 2 per cent so far this year while MSCI's measure of Asian shares other than Japan has dropped more than 8 per cent.
"Notwithstanding the recent outperformance by the Indian market, the global uncertainties or risk of an unforeseen event could keep the markets volatile in the near term," broking firm Sharekhan said in a note.
Sensex trades at 15.8 times its 12-month price-earnings while rivals China's Shanghai Composite Index and Brazi's Bovespa trade at 13.9 times and 11.4 times, respectively, data showed. Dealers awaited the annual monsoon for more cues.
The monsoon, vital for farm output in India's trillion-dollar economy, had hit the country's southern coast on May 31, a day ahead of its usual date of June 1. However, the weather office said Thursday the monsoon rains were 11 per cent below normal in the week to June 2.
Leading lender State Bank of India rose 2.4 per cent while private-sector lender ICICI Bank climbed 1.6 per cent. Mortgage lender HDFC rose 0.3 per cent. Export-focused outsourcers gained on expectations that the Eurozone debt crisis may not seriously hurt order flow from the region.
BG Srinivas, head of Infosys' Europe and manufacturing verticals told Edelweiss that the recent Europe sovereign debt crisis has not impacted the company's current business and deal flow, the brokerage said in a note Thursday.
Infosys gained 1.2 per cent while bigger rival TCS rose 0.3 per cent. HUL rose 1.7 per cent after the top household products maker said late Thursday its board would consider a share buyback on June 11.
Weak base metal prices in Shanghai and London weighed on metals stocks. Tata Steel and Sterlite Industries dropped 0.2 per cent and 0.3 per cent, respectively.
Hindalco bucked the trend and rose 1.2 per cent as it said its full-year 2009-10 net profit surged to Rs 39.26 billion from Rs 4.84 billion in the year before. The 50-share NSE index closed 0.5 per cent higher at 5,135.50.
The 30-share BSE index closed 0.56 per cent, or 95.36 points, higher at 17,117.69 points, and logged a 1.5 per cent gain for the week. Nineteen of its components advanced. "Risk appetite has not yet returned.
Europe issues are still far from resolved," said Arun Kejriwal, director of research firm KRIS. "We may continue to see selling pressure from foreign institutional investors (FIIs)."
The benchmark had dropped 3.5 per cent in May, its first monthly decline after January, as foreign funds pulled out $2 billion from Indian equities. They have already sold around $123 million in the first two sessions of June.
However, Indian markets have performed better than their peers. BSE Sensex has lost only 2 per cent so far this year while MSCI's measure of Asian shares other than Japan has dropped more than 8 per cent.
"Notwithstanding the recent outperformance by the Indian market, the global uncertainties or risk of an unforeseen event could keep the markets volatile in the near term," broking firm Sharekhan said in a note.
Sensex trades at 15.8 times its 12-month price-earnings while rivals China's Shanghai Composite Index and Brazi's Bovespa trade at 13.9 times and 11.4 times, respectively, data showed. Dealers awaited the annual monsoon for more cues.
The monsoon, vital for farm output in India's trillion-dollar economy, had hit the country's southern coast on May 31, a day ahead of its usual date of June 1. However, the weather office said Thursday the monsoon rains were 11 per cent below normal in the week to June 2.
Leading lender State Bank of India rose 2.4 per cent while private-sector lender ICICI Bank climbed 1.6 per cent. Mortgage lender HDFC rose 0.3 per cent. Export-focused outsourcers gained on expectations that the Eurozone debt crisis may not seriously hurt order flow from the region.
BG Srinivas, head of Infosys' Europe and manufacturing verticals told Edelweiss that the recent Europe sovereign debt crisis has not impacted the company's current business and deal flow, the brokerage said in a note Thursday.
Infosys gained 1.2 per cent while bigger rival TCS rose 0.3 per cent. HUL rose 1.7 per cent after the top household products maker said late Thursday its board would consider a share buyback on June 11.
Weak base metal prices in Shanghai and London weighed on metals stocks. Tata Steel and Sterlite Industries dropped 0.2 per cent and 0.3 per cent, respectively.
Hindalco bucked the trend and rose 1.2 per cent as it said its full-year 2009-10 net profit surged to Rs 39.26 billion from Rs 4.84 billion in the year before. The 50-share NSE index closed 0.5 per cent higher at 5,135.50.