Sajeev: I am not able to reason out the market’s fancy and dislike for some stocks. Stocks that made awesome gains last week declined and closed lower this week. For example, the gyrations in cement stocks and shares of the consumer durables space such as TTK Prestige and Whirlpool makes me believe that the market is bit too dicey to play.

Sruti: The buzz on stake sale by some mid-sized cement manufacturers and improving price outlook seems to have stoked stock prices in this space. As a sector, cement has underperformed the market over the last one year, so valuations may be cheap here.

Sajeev: Okay, but the index is getting very range-bound now and I think there is hardly anything that investors can do but to wait it out. Interestingly, the Sensex has managed to add 3000-odd points in the last one year without the support of RIL. The stock that analysts tracked to discern trends in the market, is giving no clues now.

Sruti: But, after shredding the non-compete pact, Mukesh Ambani is all charged up… entry into power, telecom and do you know what is coming next…? RIL is eyeing an entry into the entertainment sector. It is looking to create its own multiplex chain by building on the large space and reach of Reliance Retail.

Sajeev: The RIL stock tumbled 4 per cent for the week. Hey, the much talked about DTC bill came up on Friday and has gotten the Cabinet nod. It’s a mixed-bag as usual. MAT rate was increased to 20 per cent from 18 per cent, not great news for companies. For individual taxpayers, though some relief has been given with the minimum taxable income being raised to Rs 2 lakh from Rs 1.6 lakh currently, more news and clarity is still awaited on finer details.

Sruti: Vedanta group companies — Sterlite Industries and Sesa Goa — did badly during the week. Investors dumped shares of the two companies as the government rejected the environment clearance for Vedanta’s mining project in Orissa. The regulators seem to have indicated that business cannot be at the cost of depriving the rights of tribals.

Sajeev: Agreed…

Sruti: ONGC saved the Sensex this week…the stock moved up 5 per cent . The news of the company’s management approving funds to develop oil fields in the East of Mumbai High South fields and oil discovery in western onshore basin, propped up the stock.

Sajeev: But Rajiv, this was an announcement that was made on Friday. What actually moved the stock is the possibility of ONGCmaking a counter bid for Cairn India .

Sruti: You are right… but the management has yet not made any official statement in this regard.

Sajeev: An interesting event during the week was also the listing day show of Prakash Steelage… the stock made heads turn. It closed after rising over 60 per cent on its debut day.

Sruti: The last six-seven offers have all in fact given good listing gains to investors. But the question is, will they last?

RAJALAKSHMI SIVAM

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