Markets at a glance

A sell-off in global stocks and disappointing earnings numbers from a few big corporates pulled down the key indices during four out of five trading sessions in the week. The BSE Sensex fell below the 17,000 mark and ended the week down 695 points or 4 per cent to 16,860.

The Nifty tumbled 216 points or 4.1 per cent to 5,036. Mid-caps and small-caps fared a little better. The BSE Midcap index slumped 3.8 per cent to 6,783.66 and BSE Smallcap index dipped 3.5 per cent. The markets were not impressed by inflation which eased to 16.8 per cent for the week ended January 9, while the fuel index was up 6.34 per cent.

What to expect this week

Equities may remain volatile in a truncated week ahead of January derivative expiry. The market remains closed on Tuesday on account of Republic Day. Global stocks would feel the pressure on US administration’s proposed restriction on banks. RBI will hold its quarterly monetary policy review on January 29, there is a near-consensus that a CRR hike is imminent; however experts are still undivided on probable rate hikes.

A host of key results such as Maruti; M&M, Hero Honda, Hindalco, Sterlite, SBI, HUL, SAIL, DLF; Tata Steel, Tata Motors and Sun Pharma are expected to be released this week. Foreign investors’ attitude is also important; they sold around $360 million at the net level last week.

 

Stock to watch
SBI
Last week's close (Rs) 2,088.78 
Prev. week's close (Rs) 2,143.68 
Week's high (Rs) 2,187.28 
Week's low (Rs) 2,054.78 
Last week's ave. daily turnover (Rs cr) 492.06 
Prev. week's ave. daily turnover (Rs cr) 568.24 
Number of up/down move 2/3

State Bank of India - the country’s biggest bank will be declaring its results today. Analysts expect SBI’s loans and deposits to grow y-o-y by 5.5 per cent and 3 per cent, respectively.

Net interest margins are expected to increase to 2.65 per cent, up 10 basis points as compared to the September 2009 quarter. Its net interest income is expected to grow by 7.5-10 per cent y-o-y.

However, non-interest income is likely to be flattish due to pressure on trading gains. In view of higher provisioning, net profit is expected to increase by just 3-8 per cent y-o-y. At Rs 2,090, the stock trades at 1.4 times its 2010-11 adjusted book value.