Outlook not positive

Sanjiv Shankaran

THE average badla rate for the market was around 8.6 per cent, down by about 1.4 percentage points in relation to the previous week's rate.

The aggregate badla/carry-forward turnover was around Rs 2,363 crore, up by about Rs 150 crore in relation to the previous week.

While studying the badla turnover it may be kept in mind that this week's increase came on the heels of Infosys Technologies coming back into the picture after being in the no-delivery category for a couple of weeks.

The outlook for the coming week does not look positive. Trend setters such as Infosys Technologies may register a spell of falling price. The stock ended the settlement on a weak note. The same sentiment may continue in the near term.

Other trend setters such as Satyam Computers, Wipro and Zee Telefilms present a hazy picture. The stocks are moving in a manner that makes it tough to gather a clear picture on the direction. In this setting, when one throws in the negative sentiment created by the confusion in the US election, the outlook does not appear bright.

The redeeming feature is the strong net investment that came in from foreign institutional investors (FIIs). FIIs' inflow was positive for the whole of last week and it was also fairly large.

Talking of FIIs' inflow, the uptrend in pharmaceutical stocks, top-rung Indian ones, suggests that there may buying in the counters. Cipla, Ranbaxy and Dr Reddy's Laboratories recorded a firm trend over a few days in the recent past.

After the recent uptrend, these counters may register a phase of flat movement or a small correction. Two of the stocks, Cipla and Dr Reddy's Laboratories, registered backwardation.

Among other stocks that may weaken in the near-term are Cadbury, Digital Equipment and Reliance Petroleum. Reliance Petroleum has been on an uptrend for some time. In the near term, the stock may lose momentum.

Among the stocks that may register a firm trend in the near future are Hindalco, Hindustan Petroleum, ITC and Ballarpur Industries. Larsen & Toubro is another stock that appears to have bottomed out. The counter may see a few phases of a rising trend in share price over the next few weeks.

The preceding week saw the BSE Sensex close at 3,941 points, more or less on level with the close in the preceding week.