Markets at a glance

Domestic indices ignored the weak global markets to close with positive gains for a seventh week in a row. Sensex closed at the highest level in the last six months. BSE Sensex rose 306 points or 2.78 per cent to 11,329 and Nifty increased 96 points or 2.84 per cent to 3,481 during the week.

Demand for mid and small cap counters has helped BSE mid-cap and BSE small-cap indices to close with gains of 3.67 per cent and 2.95 per cent respectively. Sustained buying by FIIs to the tune of Rs 583.3 crore in the first four days of the week also helped to build on the gains from last week. RBI’s rate cuts were also a positive.

What to expect this week

Positive sentiment of a 25 bps rate cuts by RBI may spill over to this truncated week consisting of three trading days. Inflation at 0.26 per cent is also encouraging. However, markets would see bouts of volatility ahead of the April derivatives expiry. With some big ticket results out of the way, the focus will shift to companies like IDFC, and Bharti which would be unveiling their results during the week.

Political uncertainty may also weigh on market fortunes. Meanwhile, markets would closely track global counterparts for direction. While FII have sold heavily this year, recent purcahses of Rs 4,800 crore in April has reduced net sales to Rs 1,811 crore for the year. Continuation of this buying trend would be positive for markets.

Stock to watch
Indian Hotels
Last week's close (Rs) 175.82 
Prev. week's close (Rs) 185.20 
Week's high (Rs) 189.70 
Week's low (Rs) 172.53 
Last week's ave. daily turnover (Rs cr) 35.37 
Prev. week's ave. daily turnover (Rs cr) 57.31 
Number of up/down move 1/4

Despite management’s assurance that forex woes could end during the next quarter, Ranbaxy stock will be weighed down after its first quarter performance (CY09) which were below estimates.

The company recorded a net loss of Rs 262 crore during the quarter ended March 31, 2009, against a net profit of Rs 858 crore during the comparable quarter in 2008. Mounting foreign exchange losses and a 14 per cent y-o-y sales decline in its US market means that this is one of its worst quarterly performances ever.

This is the third quarter in a row in which the company has posted losses. Revenues declined 4 per cent y-o-y to Rs 1,558.4 crore in Q1. However, the decline was partially offset by sustained revenues from developing markets, including India.