Indian markets ended on a positive note with the Nifty closing above 6,000 and the BSE Sensex touching a new two-year high even as global markets saw bouts of profit-booking.
However, Mohammed Apabhai, Asia Pacific Trading Strategies Group of Citi has advised maintaining a cautious stance on equities after the recent rally in the fourth quarter of 2012. In an interview with CNBC- TV18, he said equity markets have hit targets in November, adding that a Nifty fall to 5,400-5500 will not be "surprising".
BSE index provisionally gained 0.02 percent, while the 50-share NSE index ended up 0.11 percent, both marking their highest closes since January 2011.
Oil marketing companies such as ONGC rose on hopes a proposed change in the government's pricing formulas would boost gas prices, while IT stocks rose on expectations for a better 2013. Shares of gold loan firms such as Manappuram Finance and Muthoot Finance continued to surge after the Reserve Bank of India proposed increasing the loan-to-value or LTV ratio to 75 percent from 60 per cent currently.
In the coming week, the important events include Infosys numbers ( on 11th Jan).
"Markets would also await the inflation numbers. If there is a reduction in inflation, then expectations of a rate cut could get strengthened when the RBI meets on Jan 29th. Consequently rate sensitive sectors may outperform. Momentum is with the market. A spike in Crude prices may however spook the markets," Sanjeev Zarbade, Vice President (Private Client Group Research), Kotak Securities, said in a note today.
Infosys ended half a percent higher after the company denied reports that it was laying off 5,000 employees to cut costs.
After falling by a percent, the RIL stock ended flat after market regulator Sebi rejected Reliance Industries' request to settle a long-pending dispute over the energy conglomerate's 2007 sale of stock futures in a unit, citing rule changes in late May that took a tougher stance on suspected violations
IFCI ended 11 percent higher after it announced that Government has nominated Shri Anurag Jain, Joint Secretary, Ministry of Finance, Department of Financial Services on the Board of the Company, in place of Sanjeev Kumar Jindal, Director and V. K. Chopra, Deputy Secretary.
Activity in the Indian private sector improved during December for the forty-fourth successive month. The HSBC India Composite Output Index posted 56.3 in December, up from 53.2 in November.
Meanwhile, to enhance electricity generation in India, the oil ministry has notified guidelines for diversion of scarce gas between two or more power plants of the same owner. The ministry notified that the clubbing or diversion should not be for more than a year in total, which should lead to the higher electricity generation compared to the pre-clubbing arrangement.
"On the global front, after the somber run of Asian counterparts, European shares were trading downbeat on Friday as signs of rising concerns among US Federal Reserve members about the central bank's quantitative easing programme prompted investors to book a portion of recent strong gains," said Nirmal Bang in a research report.
Japanese stocks soared, while most other Asian markets fell on concerns US central bankers were considering an end to their bond-buying programme.