The Indian stock markets entered a consolidation phase, with key indices losing over 5% over the week. The Sensex fell 914 points, or 5.44%, to close at 15,896, while the Nifty lost 5.7% to close at 4,711. Analysts said the downward movement was expected as stock valuations had become detached from corporate earnings. Foreign funds were net sellers during the week, offloading shares worth $12.8 million.

1. SENSEX ENTRENCHED IN CONSOLIDATION ZONE, LOSES 5.44 PERCENT IN WEEK
By: IANS Date: 2009-10-31 Place: Mumbai
Indian equities markets entered into a consolidation zone with analysts terming the
downward movement as long expected.
A benchmark index fell 5.44 percent from its last weekly close and ended trade below the
16,000-mark.
The 30-share sensitive index (Sensex) ended 914.53 points, or 5.44 percent lower, at 15,896.28
points at the weekly close Friday, as opposed to the previous week's close at 16,810.81 points.
The broader S&P CNX Nifty of the National Stock Exchange (NSE), too slipped, closing at
4,711.7 points, down 5.7 percent from its last weekly close.
However, companies with large-to-medium market capitalisation saw greater selling with the
BSE midcap index ending 7.36 percent lower and the BSE smallcap index losing 8.01 percent
over the last week.
"This consolidation was expected anyways as the valuations were not commensurate with the
earnings of corporates. To an extent a correction in valuations was warranted," said
Jagannadham Thunuguntla, equities head of brokerage and capital markets consultancy SMC
Capital.
The markets started on a cautious note Monday ahead of the Reserve Bank of India's mid-year
policy review Tuesday. The Sensex ended a volatile day at 16,740.50 points -- 70.31 points or
0.42 percent lower than Friday's close.
The Nifty followed a similar trajectory and ended in negative at 4,970.9 points, down 0.52
percent.
Both benchmark indices nosedived Tuesday as the RBI indicated in its policy review that it
would start tightening the monetary policy and look at exiting the stimulus measures.
The Sensex shut shop at 16,353.4 points -- 387.1 points or 2.31 percent lower than its previous
close, and the Nifty too ended on a similar note at 4,846.7 points, down 2.5 percent or 124.2
points.
On Wednesday, the Sensex recouped most of its losses to end trade at 16,283.49 points, down
0.43 percent or 69.91 points. The Nifty was also in the red at 4,826.15 points, down 0.42 percent
from its last close.

2. The markets lost fourth straight day Thursday with the Sensex closing at 16,052.72 points, 1.42
percent or 230.77 points lower than its previous close. The Nifty too closed in the negative at
4,750.55 points, down 1.57 percent or 75.6 points from its last close.
The Sensex ended Friday below 16,000 points at 15,896.28 points -- 156.44 points or 0.97
percent down, while the Nifty followed a similar path and closed lower at 4,711.7 points, down
0.82 percent.
Data with markets watchdog Securities and Exchange Board of India (SEBI) showed that foreign
funds were net sellers during the week, having sold scrips worth $12.8 million.
The top gainers this week on the Sensex were Tata Motors (up 7.2 percent), Ranbaxy Labs (up
4.8 percent), Wipro (up 2.9 percent), Grasim (up 1.6 percent) and Hindustan Unilever (up 1
percent).
The top losers were DLF (down 18.5 percent), Reliance Capital (down 14.5 percent), Reliance
Infrastructure (down 14.2 percent), Hindalco (down 13.9 percent) and Reliance Power (down
12.9 percent).
"Broadly speaking only about one percent of the quarterly results show a sound top line growth.
Profits might have increased, but that is not because of increase in core operations - cost cutting
and other income have contributed towards it," said Thunuguntla.