Reference Auto

The stock markets saw some pounding last week after the inflation spiralled and the Reserve Bank hiked rates to tame it. The apex bank could possibly opt for some more tightening in the near term.

The 30-stock Sensex of the Bombay Stock Exchange (BSE) closed the week at 18,395.97 points, a fall of 3.22% or 611.56 points from the previous week’s close of 19,007.53 points.

The 50-scrip Nifty of the National Stock Exchange also ended 184.35 points (3.23 per cent) lower at 5,696.5 points.

Among the Sensex stocks, five saw gains — SBI, a rise of 3.5 per cent to Rs 2,618.55; NTPC, a 1.2 per cent rise to Rs 191.80; Reliance Infra, 0.9 per cent up at Rs 724.20; Tata Steel, a rise of 0.7 per cent to Rs 635.90 and ONGC, up 0.1 per cent to Rs 1,135.60.

Some big losers from the Sensex pack were DLF, a fall of 12.2 per cent to Rs 223.10; Hindustan Unilever, down 9.5 per cent to Rs 272.45; Mahindra, a fall of 8 per cent to Rs 696.85 and Hero Honda, which saw a slide of 7.1 per cent to Rs 1,657.45.

In tune with the Sensex, the BSE mid-cap as well as the small-cap saw some hammering, ending at 4 per cent and 4.5 per cent lower respectively.

The bearish grip at the bourses prompted foreign institutional investors (FIIs) to sell stocks worth $161.6 million during the week.

The trend in the Asian stock markets was mixed. During the week, the Japanese Nikkei ended 0.84 per cent up at 10,360.34 points but the Hong Kong’s Hang Seng tanked 1.09 per cent to close at 23,617.02 points. Shanghai Composite index saw a rise of 1.38 per cent and ended at 2,752.75 points.

The US markets ended lower in the wake of the unending protests in Egypt, sparking fears that this stir could infect other regions of the Middle East and send oil prices soaring

The Dow Jones Industrial index ended 0.41 per cent lower during the week at 11,823.7 points and S&P 500 a tad lower at 1,276.34 points. Also, the Nasdaq index closed almost flat at 2,686.89 points.

The New Year has seen bears grip the Indian bourses despite world markets putting up a good show. Year-on-year, the Sensex has slid 10 per cent and some positive triggers are needed to keep the country’s bourses going.

But a good show by India Inc in the October-December quarter, especially the banking sector, could see a revival in the stock markets. But inflation, especially food inflation, will have to be kept in check for the markets to get back their buoyancy.

There is a worry though. FIIs seem to have lost faith on the bourses (for now) and a further withdrawal by these institutions cannot be ruled out. If that happens, the bourses are likely to remain in the red for some time.