Markets at a glance

A slight revival in monsoon and firm global markets pushed up benchmark indices during all the five trading sessions of the week. Nifty jumped 204 points or 4.5 per cent to 4,732, its highest closing since June 2008, while Sensex rose 682 points or 4.5 per cent to 15,922 for the week.

Higher volatility was observed on Thursday due to expiry of August 2009 derivative contracts. Gains in smaller companies were higher. The BSE Mid-Cap index jumped 5.5 per cent and the BSE Small-Cap index rose 7.7 per cent. Net purchases by foreign funds to the tune of Rs 3,200 crore in the first four days also helped sustain the rally.

What to expect this week

Besides global cues (markets rallied to 10-month highs last week), FII activity and progress of India’s monsoon would influence sentiment on the domestic bourses. While sentiment is bullish, better rollover positions for September series suggest a positive outlook for equities.

Market players would also keep an eye out for CSO’s gross domestic production data to be released this week. Primary markets are also heating up with Oil India, the second biggest IPO from the government stable after NHPC this year, hitting the primary markets shortly. 

Stock to watch
TATA MOTORS
Last week’s close (Rs) 490.05 Prev. week’s close (Rs) 432.70 Week’s high (Rs) 505.35 Week’s low (Rs) 437.65 Last week’s ave. daily turnover (Rs cr) 378.94 Prev. week’s ave. daily turnover (Rs cr) 286.85 Number of up/down move 4/1

Tata Motors (TML) scrip could come into play this week as the company will announce the consolidated results for the June quarter today. The standalone results were better than market expectations with net profits growing at 57.5 per cent though revenues declined 7.6 per cent.

Analysts expect TML to report a loss for Q1FY10 on a consolidated basis, mainly on account of Jaguar Land Rover (JLR). Compared to a reported standalone profit of Rs 510 crore, JLR is expected to deliver a loss of around Rs 600-650 crore as TML was not able to implement substantial cost-cutting initiatives due to prolonged nature of the talks on the bailout with the UK government.

At Rs 490, the stock is trading at 25 times its 12-month trailing EPS. The stock is trading near its 52-week high of Rs 505.