Markets at a glance

Recovery of global markets supported the domestic indices in a truncated week. Sensex gained 431 points or 5.2 per cent to 8,757 and Nifty rose 99 points or 3.78 per cent to 2,719 in the week. The market gained in two out of three trading days in the week. Inflation at six-and-a-half year lows of 2.34 per cent also assisted a smart bounce back.

The market also shrugged off weak Industrial production numbers of a negative 0.5 per cent on the way up. Overall, FIIs who were net sellers this year have been net purchasers to the tune of Rs 27.43 crore during the week.

What to expect this week

Domestic indices could track global equity markets in the near term. Reassurances from Citigroup, Bank of America and J P Morgan could sustain positive sentiments. Lower inflation numbers over the last few months and its sharp fall recently has raised expectation of further rate cuts by central bank, which would be a positive.

On the agriculture front, there is an expectation that this year’s Rabi crop would be good. The fourth tranche of advance tax payments of corporate India is due today, which should also give direction to the market. However, the markets would be edgy as FIIs have been net sellers of Rs 2,276 crore till date.

 

Stock to watch
Consolidated construction
Last week's close (Rs) 47.67 
Prev. week's close (Rs) 44.63 
Week's high (Rs) 49.80 
Week's low (Rs) 42.13 
Last week's ave. daily turnover (Rs cr) 4.08 
Prev. week's ave. daily turnover (Rs cr) 6.78 
Number of up/down move 2/1

A acquisition of a 6 per cent stake in Gateway Distriparks (GDL) by Allcargo’s subsidiary would keep the interest in the GDL counter high. The stake at Rs 25-Rs 30 crore was acquired by Sealand Terminals, an Allcargo Global Logistics subsidiary, from Temasek.

Though Allcargo has indicated that it is only a treasury investment, its synergies with Gateway, which is the largest player in the CFS business in JNPT, could help Allcargo if it chooses to increase its stake in GDL in the future.

With a decline in cargo volumes on the export front, GDL has increased its focus on the domestic segment. The company is debt-free and is trading at 5.4x of its trailing 12-month EPS of around Rs 8.3.