FMCG stocks seen up
Shares of fast moving consumer goods companies are seen rising this week helped by positive rollovers ahead of expiry of the November futures contract, dealers said. Analysts are upbeat on FMCG shares on hopes that sales volumes may rise due to increase in advertising and promotional spends. This week, the BSE-FMCG index performed in line with the broad market, rising 1.5%. Colgate-Palmolive India may rise amid reports Reckitt Benckiser, the world's largest maker of household cleaners, may be looking to merge with the company.
Steel expected to gain
Steel shares are expected to continue their gains this week, backed by enthusiasm over a seeming return of mergers and acquisition activity in the sector, analysts said. JSW Steel Ltd's alliance with Japan's JFE Steel, which may culminate in the two buying stake in each other, has the street chirping about the possibility of more such deals. The announcement by the two companies follows ArcelorMittal's plan to buy 35% stake in Uttam Galva Steels for a little over Rs 500 crore. Steel stocks have been outperforming the broader indices for the past two weeks, a sign that the sector is becoming a favourite for investors. Last week, JSW Steel and Tata Steel led the advances.
PSU banks may rise
Shares of state-owned banks are likely to rise this week on hopes the government's efforts on consolidation will lead to mergers in the sector, analysts said. Talks of mergers have spurred buying in the last two days, after finance minster Pranab Mukherjee met five leading public sector banks on Wednesday to discuss issues related to consolidation. Canara Bank, Punjab National Bank, Bank of India, Bank of Baroda and Union Bank of India were the banks that participated in the meeting. Broadly, banking shares could remain firm, and movement in shares of private banks will depend on the overall sentiment in the market, analysts said.
IT may be range-bound
Information technology shares are seen within a range this week as, despite improving demand, companies expect substantial recovery to take a little while longer. Clarity is expected only once the December quarter draws to an end, when clients would be closer to disclosing allocations for IT spend. Indications that margins may remain flat this financial year to March is also worrying investors. Dealers recommend playing on mid-cap stocks for a while as large-caps are near resistance levels.
Pharma seen subdued
Pharma shares are likely to remain subdued this week with both the upside and downside capped for majority of counters in the segment, dealers said. Also with the November contract expiry on Thursday, these counters may witness some short covering, market watchers said. The nearest trigger for pharma shares could be the Oct-Dec earnings, which will be reported in January. Analysts believe valuations of most of pharma counters such as Cipla and Ranbaxy, as well as Dr Reddy's Laboratories, are stretched and that no gains can be expected in the foreseeable future. However, pharma is still being considered the safest bet if the broad market weakens as the companies are expected to do reasonably well in terms of earnings in the foreseeable future.



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