The markets staged a recovery after a steep correction during the first half of last week. The trading was characterised by bouts of sharp intra-day volatility, especially in the last three trading sessions. The BSE Sensex managed to cross the 16,000 level during the last sessions of the week. During the week, the Sensex rose 262 points or 1.65 per cent to 16,158, while Nifty rose 84 points or 1.79 per cent to 4,796. However, mid-caps outperformed the broader indices during the week, whereas small-caps underperformed. FIIs were net sellers initially, but started buying during the second half of the week.
Global cues could decide the market course in the next few sessions. The US Fed’s promise on keeping interest rates low is positive for equities, going ahead. On the domestic front, the assurance that the fiscal stimulus will be continued, capital inflows and divestment talk are positive signs. However, volatility could be the order of the day as FIIs could resort to year-end profit taking. The VIX saw heightened activity last week. Besides, markets could keep a close eye on the September 2009 industrial data and also the monthly inflation for October, both of which will be released on November 12.
Stock to watch
SUZLON ENERGY
Last week's close (Rs) 66.28 Prev. week's close (Rs) 66.87 Week's high (Rs) 68.23 Week's low (Rs) 53.80 Last week's ave. daily turnover (Rs cr) 649.78 Prev. week's ave. daily turnover (Rs cr) 301.63 Number of up/down move 2/2
After poor results in the September quarter, Suzlon Energy is likely to attract investor interest on news that it is exploring refinancing options. Market watchers say the company is close to restructuring a large portion of its Rs 12,500 crore debt burden.
This assumes importance as the company had not been successful in restructuring its loans in the past. Besides refinancing, the company is planning a strategic or complete stake sale in Hansen Transmissions to reduce its absolute debt.
Due to poor results several brokerages had downgraded the stock. Nomura downgraded earnings estimates by 112 per cent (a loss of Re 0.9 per share) and 37 per cent (EPS of Rs 5.9) for 2009-10 and 2010-11, respectively.
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