Markets at a glance

Obama's stimulus plan boosted sentiment across financial markets during the past week. Metals, realty, oil & gas led the charge in a week where Sensex rose 750 points or 8.6 per cent to 9,424 points whereas Nifty gained 103 points or 3.7 per cent to 2,874.80. The truncated week saw a bout of short-covering of open positions in the closing week of January derivative contracts.

FIIs were net buyers to the tune of Rs 60.6 crore. Despite, RBI's neutral stand on the interest rate front, the market trended up. Inflation for week ended January 17 was at 5.64 per cent marginally higher than 5.6 per cent in the previous week. Government also effected price cuts in the auto as well as cooking fuel segments.

What to expect this week

The results season is almost over, with all major companies having declared results. The attention would now shift to the likely impact of the slowdown in demand and its impact on profitability going ahead. Indian bourses would look for cues from global markets as a recent IMF assessment says that US GDP would contract by 1.6 per cent and Japan’s by 2.6 per cent.

Volatility in the financial markets would persist in the light of local and global developments. After the fuel-price cut, more populist measures might be doled out in view of general elections in the country.

 

Stock to watch
SBI
Last week's close (Rs) 16.25 
Prev. week's close (Rs) 14.53 
Week's high (Rs) 16.37 
Week's low (Rs) 14.75 
Last week's ave. daily turnover (Rs cr) 8.41 
Prev. week's ave. daily turnover (Rs cr) 9.89 
Number of up/down move 3/1

Shares of Nagarjuna Fertilizers & Chemicals (NFCL) would be in action after the Mumbai high court lifted the ban on Reliance Industries on selling gas from the KG basin for a period of 45 days.

NFCL was running short on natural gas (cheaper fuel) for its operations; it had to depend on high-cost naphtha. Costs are likely to be even higher as it has expanded its urea capacity. The company has signed a MoU with Reliance for supply of gas.

For the December quarter, standalone net profit dropped 15.92 per cent y-o-y to Rs 4.6 crore. Net sales declined 12.95 per cent to Rs 543.4 crore in the same period. The stock is trading at 33 times its trailing EPS of 0.5.