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Nachiket Kelkar
Nachiket Kelkar

Markets

Nifty, Sensex register gains for the fifth straight week

sensex (File photo) Representational image

It was a volatile session on the equity markets on Friday, with the benchmark BSE Sensex fluctuating almost 250 points and the NSE Nifty 50 falling below the 10,000 mark, before late buying saw both indices snap two days of losses and ending firmly in the green.

The Sensex closed up near 88 points or 0.3 per cent at 32,325.41 and the Nifty 50 gained 53 points or 0.5 per cent to end at 10,066.40.

For the week, the Sensex closed up 0.04 per cent, and the Nifty 50 rose 0.5 per cent, gaining for the fifth straight week.

While some profit booking continued in the initial period, renewed buying in index heavyweights in the later part of the trading session boosted markets, said Vinod Nair, head of research at Geojit Financial Services.

Auto stocks were in the spotlight this week and continued to accelerate on Friday, following their strong sales figures for the month of July. Hero MotoCorp, which reported a strong 17 per cent sales growth in the last month, shipping over 6.23 lakh two-wheelers, rose more than three per cent on Friday, closing over nine per cent higher for the week.

Among other two-wheelers stocks, Bajaj Auto gained 1.4 per cent today, Tata Motors was up 0.7 per cent and Maruti Suzuki was up 0.5 per cent.

Other major gainers on Friday included Coal India and Tata Steel, which rose close to three per cent, NTPC gained 2.8 per cent and State Bank, Cipla and Hindustan Unilever were up close to two per cent.

Barring Cipla, many other pharma stocks were under pressure; Dr Reddy's was the biggest Sensex loser, down near four per cent. The pharma major has tumbled more than 14 per cent since it reported a 57 per cent decline in quarterly profit on July 27.

Among other pharma stocks, Biocon shares plunged nine per cent after the US Food and Drugs Administration issued 10 observations on the biotech company's Bengaluru plant.

Orchid Pharma, Glenmark, Sun Pharma, Jubilant Lifesciences and Cadila Healthcare among others were down two to three per cent.

Pharma companies have been under US FDA watch for some time now and there have also been pricing pressures in the US, one of the largest export markets for many Indian drug makers. Many analysts have advised investors to stay away from the sector for now.

“The pharma sector continues to face US regulatory and pricing pressure, which refrained investors to give focus even at the low valuation,” said Nair.

India's equity markets have surged this year, with the Sensex gaining 21 per cent so far this year, helped by strong domestic as well as foreign fund flows. FIIs net bought equity worth Rs 5,161 crore in July, taking their total equity investments so far in 2017 to Rs 57,000 crore.

Earnings for the first quarter so far have been mixed bag and will continue to be keenly watched. Some of the heavyweights like Tata Steel, Tata Motors, State Bank of India and Bank of India among others will report earnings next week.

Investors will be also watching if and how banks react to Reserve Bank of India's 0.25 per cent Repo rate cut and reduce lending rates.

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