Weekly markets: Sensex ends volatile week in red

Global cues, RBI policy take markets lower

Benchmark share indices witnessed volatility to close the eventful week ended June 22 with marginal gains. The 30-share Sensex inched up 23 points or 0.1% to close at 16,973 and the 50-share S&P CNX Nifty firmed up 7 points or 0.1% to end 5,146.

The Reserve Bank of India, on Monday, kept the interest rates unchanged on heightened inflation worries leaving India Inc and retail borrowers disappointed.  In its mid-quarter review, the RBI said it had "frontloaded the policy rate reduction in April with a cut of 50 basis points.Analysts feel that the reason for the current growth-inflation dynamic is that there are several factors responsible for the slowdown in activity, particularly in investment with the role of interest rate being relatively small.

Competition watchdog CCI imposed a hefty penalty of about Rs 6,200 crore on 11 leading cement companies including ACC, Ambuja Cements, Ultratech and Jaypee Cements for price cartelisation.

The other companies found guilty are Grasim Cements now merged with Ultratech Cements, Lafarge India, JK Cement, India Cements, Madras Cements, Century Cements and Binani Cements. The industry body Cement Manufacturers Association (CMA) has also been fined. The firms in violation of the competitive laws have been directed to deposit the penalty within 90 days.

During the week, global agency Fitch cut credit rating outlook to negative from stable of 11 financial entities including SBI, ICICI Bank, PNB and Axis Bank. The action follows the revision earlier this week of India's outlook to negative.

The list of downgraded entities include six government banks (including an international banking subsidiary of a government bank), two private banks. These include Bank of Baroda, Bank of Baroda (New Zealand) Ltd (BOBNZ), Canara Bank, and IDBI Bank.

The gains were led by capital goods and healthcare shares. The BSE Capital Goods Index was the top gainer during the week up 2.2% while the Healthcare Index rose 2%.

BSE IT index slipped 1.7% to 5663 this week as the rupee touched a record low of 57.32, hurt by dollar demand from oil firms and gold importers as well the broad risk-off sentiment.

Metal index slipped 1.45% to 3,294 following the sell-off in global commodities.

Energy major Reliance Industries and its partners BP and Niko Resources plan to spend $4 billion (Rs 22,000 crore) to develop satellite gas fields off India's east coast, a newspaper reported on Friday, citing company officials and government sources. Reliance holds 60% of the D6 block, BP has 30% and the rest is held by Canadian oil and gas producer Niko. Shares of Reliance dropped 2% to Rs 711.

Alstom Industries added 4% in the capital goods space, followed by Thermax, Bharat Electronics, Praj Industries and Punj Lloyd. From the heathcare space, the big gainers were Cadila Healthcare, Piramal Healthcare, Biocon and Strides Arcolabs.

Meanwhile, IT shares slipped, led by TCS - down 3% at Rs 1,234. HCL technologies, Infosys and Tech Mahindra declined 1-2% each. However, Wipro added 0.6% at Rs 401. From the metal pack, Hindalco dropped 5% to Rs 117, followed by SAIL, Jindal Steel, Coal India and Sterlite.