The Nifty continued its upward move, crossing technical resistances and closing above 8,400 points for the first time in two months on the back of positive global cues and decent Q3 results from technology majors Infosys and TCS.
The New Year began on a positive note with the Nifty briefly touching the 8,300 mark and ending the week 0.7 percent higher at 8,244.
As an outsider, I remarked on October 24 that the Tatas had strategically picked a good time and place to wage their battle with Cyrus Mistry, who was ousted as chairman of Tata Sons on that day. The question has always been whether there is enough cause for Mistry to dispute this majority action and successfully litigate against the Tatas. Also, what could he achieve by litigation? If the courts were to agree that Mistry was unfairly dismissed from office, what kind of relief can they offer? Is he likely to achieve a measure of success in claiming that he had either lost money (more money than other shareholders) or had been otherwise unfairly prejudiced? And should he either be reinstated as chairman of the Tata conglomerate’s holding company or offered some other relief, possibly monetary, through the legal process?
Indian markets turned green on Friday after falling for the previous seven sessions. The Nifty was still 1.9 percent down for the week at 7,985.
The U.S. Fed raised rates on expected lines but a hawkish stance for 2017 unnerved global stocks, which led to weakness in emerging markets including India.
The reasons given for demonetisation were probably, on balance, right: reducing black money, eliminating counterfeit currency, stopping terrorism financing, and moving to a less cash-oriented economy.
The Nifty rode on positive global cues to gain over 2 percent during the week to close at 8,262 despite the RBI disappointing investors by holding rates steady and a rather mixed message from the ECB.
Markets turned indecisive during the week with the Nifty witnessing sharp gains in the first three sessions to cross 8,200 but then falling to close at 8,087 on Friday. The rise in crude oil prices after OPEC’s decision to cut production also dampened sentiments.
The Nifty gained nearly 0.50 percent during the volatile week to end at 8,114. Fears of the negative impact of the government’s withdrawal of high-value currency notes continue to affect sentiment, but cues from other markets were mostly upbeat, which meant India was ‘decoupled’ from global markets. FIIs were net sellers to the tune of $792 million.
Indian markets experienced unabated selling pressure in the aftermath of the government’s demonetisation drive. FIIs turned net sellers to the tune of $986 million and the Nifty closed the week at 8,074, down 2.7 percent.
Even after Narendra Modi promised on the campaign trail in 2014 to “do away with the criminalization of politics”, money and muscle still dominate the electoral scene in India, Milan Vaishnav writes in his forthcoming book “When Crime Pays”.