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Even after the rate hike, the stock markets managed to close in the positive


Third week of straight gains. Sensex closes at 16,933
For the week covering September 12 to September 16 the major benchmark index increased for the straight third week, despite the Reserve Bank of India increasing its interest rates for the 12th time. Although this time it was in line with the forecast.

In total NSE Nifty added close to 0.4% during the week, meanwhile the BSE Sensex gained approximately 0.5% to 16,994.


Among the losers on the sectoral indices were the FMCG, capital goods and the Metals index were among the major losers. The gainers list has the names of the following sectors: Oil & Gas, IT index, Realty along with Auto were among the top gainers.

The week had mixed bag of news. While on the domestic front the RBI increased the policy rates, following announcements of high inflation. Also if this move does not control inflation over the next month then there is a possibility that there will be further hikes. However, on the external front, there were some good news like the central bankers were trying to work out a formula to save the Euro-zone.

On the stocks front, Tata Motors, the owner of the prestigious brand JLR and the biggest truck maker in the country increased by 7%.

And the government owned oil marketing company, ONGC saw a rally as the government announced that it will delay its share sale.

The performing major index in Asia has been the Sensex as it tumbled 17% this year. There was concerns among the investing community that RBI's rate increases can have compounded effect on the if Europe"s sovereign-debt crisis unravels. Also there is a serious concern over the slowing economic growth in U.S.

In the month of August the Foreign Institutional Investors withdrew a net $2.4 billion, this is the maximum in since October 2008.

Read more about: bse sensex nse nifty fii capital market
Story first published: Saturday, September 17, 2011, 12:06 [IST]
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