Stocks
Bulls survive a scare as Nifty endures 5,171

Strong resistance is pegged in the 5,372-5,385 points range and unless and until this is decisively taken out the bears continue to hold a slight edge. One should persist with the strategy of selling in rallies especially close to the above mentioned area

S&P Nifty close: 5295.55    

 
Market Trend
Short Term: Sideways        Medium Term: Sideways        Long Term: Down


The Nifty opened flat and sold off immediately to the bulls on the brink as it hovered around recent low of 5,171 points (in fact it was broken during intra-day trading) but holding above it in close. The fact it survived the F&O (futures and options) settlement day resulted in short covering which took the Nifty to the high of the week before settling 18 points (+0.33%) higher. This has resulted in a “hammer formation” (indicating at least a temporary bottom) but further evidence is awaited.

The sectoral indices which outperformed were BSE Healthcare (+2.46%), BSE Fast Moving Consumer Goods (+2.04%) and BSE Metal (+1.10%) while the gross underperformers were BSE Power (-2.43%), BSE Consumer Durables (-1.03%), BSE PSU (-0.97%) and BSE Capital Goods (-0.83%).  The weekly histogram MACD continued to move down but is still above the median line indicating that the bulls’ hopes are still alive. However the volumes were flat during the recovery.

Here are some key levels to watch out for this week
  • As long as the S&P Nifty stays above 5,246 points (pivot) the bulls would breathe easy even though the intermediate trend is sideways.
  • Support levels in declines are pegged at 5,185 and 5,075 points.
  •  Resistance levels on the upside are pegged at 5,356 and 5,417 points.

Some Observations
1.    The Nifty closed above the pivot of last week and has formed a ‘hammering’, raising hopes of the bulls of the recovery gaining further ground.
2.    Weekly averages still continue to be negatively phased hence a close below these would result in the selling pressure accentuating.
3.    Unless and until the 5,372-5,385 points range is taken out in close the bears will hold the egde and a break of the recent low of 5,171 points (in close) would set the cats amongst the pigeons.

Strategy
Strong resistance is pegged in the 5,372-5,385 points range and unless and until this is decisively taken out the bears continue to hold a slight edge. One should persist with the strategy of selling in rallies especially close to the above mentioned area. We are likely to witness see-saw trading during the course of this week as the bulls and bears fight to take control. The successful testing of the low of 5,171 points has become paramount importance for the bulls to defend this level at all costs to prevent chaos.

(Vidur Pendharkar works as a consultant technical analyst & chief strategist at www.trend4casting.com)

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Sensex, Nifty likely to rally further: Friday Closing Report

The market closed well above yesterday’s high and may hit 5,365, and then 5,400

Dispelling fears of taxes on investments through P-Notes by the government saw the market move higher since the opening bell. We had mentioned in our closing report yesterday that if the Nifty manages to close above 5,195, the downtrend may be arrested. Today the index went on to hit its five-day intraday high (including today) and more than covered the losses incurred in the prior two days. The index managed to even close above its 20-day moving average and witnessed a maximum percentage gain since 3rd January 2012.  

If the benchmark manages making higher high and stays above 5,290, we may see an upmove to the level of 5,365, and then up to 5,400. The Nifty saw a huge gain on lower volume of 71.40 crore shares on the National Stock Exchange (NSE).

The market opened on a positive note following assurance from finance minister Pranab Mukherjee that government on Thursday will clarify its position on taxation of investments from overseas, amid foreign institutional investors (FIIs) expressing concern on the proposed anti-tax avoidance rules. The Nifty opened 28 points up at 5,207 and the Sensex gained 58 points to resume trade at 17,117.

Across-the-board buying saw all sectoral indices trading with gains as trade progressed. Fresh assurances from the finance minister that persons investing in stock markets through P-Notes will not have to pay taxes in India, pushed the market further northward in post-noon trade. The market hit its intraday high around 3.00pm with the Nifty touching 5,307 and the Sensex climbing to 17,440.

The market closed a tad of the highs with the Nifty gaining 117 points (2.25%) to 5,296 and the Sensex jumping 346 points (2.03%) to settle at 17,404.

The advance-decline ratio on the NSE was positive at 1321:424.

Among the broader indices, the BSE Mid-cap index jumped 2.35% and the BSE Small-cap index surged 2.04%.

The rally saw all sectoral indices settling higher. The main gainers were BSE Oil & Gas (up 2.82%); BSE Realty (up 2.61%); BSE Metal (up 2.58%); BSE PSU (up 2.57%) and BSE Bankex (up 2.55%).

The Sensex was led by Tata Steel (up 4.04%); Maruti Suzuki (up 3.76%); Hindalco Industries (up 3.73%); ICICI Bank (up 3.64%) and Reliance Industries (up 3.23%). Jindal Steel (down 0.69%) and Sun Pharma (down 0.23%) were the laggards on the index.

The Nifty toppers were Kotak Mahindra Bank (up 4.84%); IDFC (up 4.61%); SAIL (up 4.02%); Ranbaxy (up 3.73%) and Hindalco Ind (up 3.69%). The key losers were Cairn India (down 0.98%); Jindal Steel (down 0.74%); Sun Pharma (down  0.67%) and Hindustan Unilever (down 0.33%).    

Markets in Asia settled mostly higher on hopes of European policymakers, who are meeting to day, would hike the Eurozone bailout fund to help cash-strapped nations. The gains were also supported by better-than-estimated earnings from Chinese banks.

The Shanghai Composite rose 0.47%; the Jakarta Composite gained 0.40%: the KLSE Composite climbed 0.69%; the Straits Times advanced 0.55% and the Taiwan Weighted settled 0.77% higher. Bucking the trend, Hang Seng declined 0.26%; the Nikkei dropped 0.31% and the Seoul Composite shed 0.02%. At the time of writing, the key European indices were 0.60% to 1.22% higher and the US stocks futures trading in the green.

Back home, foreign institutional investors were net sellers of a huge Rs1,332.85 crore worth of stocks on Thursday, a large part of which would have a block deal by a private equity investor (possibly Warburg Pincus sale of Kotak Mahindra Bank), while domestic institutional investors were net buyers of shares totalling Rs229.67 crore.

State-run Oil & Natural Gas Corporation (ONGC) plans to sign an agreement with ConocoPhillips on the exploration and development of shale-gas reserves and deep-water oil and gas blocks. ConocoPhillips is the third-largest integrated energy company in the US and the fifth-largest refiner in the world. The Indian exploration major gained 3.05% to close at Rs268.35 on the NSE.

Medium and heavy vehicle major Ashok Leyland has said that it will form a separate subsidiary as it explores expansion into the aerospace business with global partners. This is part of the automaker’s plan to diversify beyond manufacturing vehicles. The stock jumped 4.30% to settle at Rs30.30 on the NSE.

Strides Arcolab has received USFDA approval for Methotrexate Injection USP 25 mg/ mL packaged in 1 gram/ 40 m, 50 mg/2 mL, 100 mg / 4 mL, 200 mg/ 8 mL and 250 mg / 10 mL single-dose vials (preservative-free). Methotrexate is a chemotherapy drug used either alone or in combination with other agents. It is used as a treatment for some autoimmune diseases including rheumatoid arthritis, psoriasis, psoriatic arthritis, lupus and Crohn's disease, to name a few. Strides finished 1.18% lower at Rs582.20 on the NSE.

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COMMENTS

Shibaji Dash

6 years ago

Assurance of FM- is it compatible with GAAR ? Time will show.

Sensex, Nifty may suffer further decline: Thursday Closing Report

Nifty has to close above any previous day’s high for the downtrend to reverse

Weak global cues and domestic growth concerns weighed on the market, pulling it down for the second day. On an above 10-day moving average volume of 86.83 crore shares on the National Stock Exchange (NSE) on account of the futures and options expiry day, the Nifty fell marginally by 16 points. Yesterday we had mentioned that the index has to breach 5,170 or 5,275 to set a direction. Today the index fell below the lower range and settled slightly above it. If the benchmark manages to close above 5,195, the downtrend may be arrested.

The market opened lower amid weak global cues and concerns over the new taxes proposed by the finance minister in the Budget, which would come into effect shortly. On the global front, dismal economic data pulled down US stocks overnight while markets in Asia were mostly lower in early trade on worries about the slowdown in growth. The Nifty opened 49 points down at 5,146 and the Sensex resumed trade at 17,040, down 82 points from its previous close.

The market was range-bound till noon trade in the absence of any triggers and touched the day’s lows around 12.30pm. At the lows, the Nifty fell to 5,136 and the Sensex went below the 17,000 level to touch 16,921.

Bargain hunting at lower levels saw a splendid recovery in the post-noon trade, which enabled the market hit its intraday high. At that point, the Nifty was at 5,194 and the Sensex 17,109. However, the market closed negative. The Nifty settled 16 points lower at 5,179 and the Sensex finished the session at 17,059, down 63 points.

The advance-decline ratio on the NSE was tilted in favour of the gainers at 943:773.

The broader markets outperformed the Sensex as the BSE Mid-cap index rose 0.16% and the BSE Small-cap index climbed 0.70%.

Among the sectoral indices, BSE Healthcare (up 0.92%); BSE Consumer Durables (up 0.88%); BSE Auto (up 0.67%); BSE Metal (up 0.39%) and BSE Realty (up 0.35%) were the top gainers.BSE Capital Goods (down 1.61%); BSE IT (down 1.17%); BSE TECk (down 1.01%); BSE Fast Moving Consumer Goods (down 0.65%) and BSE Bankex (down 0.15%) were the key losers.

The key performers on the Sensex were Jindal Steel (up 4.42%); Tata Power (up 2.99%); Hero MotoCorp (up 1.55%); Wipro (up 1.27%) and ONGC (up 1.14%). The top laggards were Larsen & Toubro (down 2.09%); Infosys (down 1.78%); TCS (down 1.71%); Bharti Airtel (down 1.60%) and BHEL (down 1.35%).

The Nifty was led by Tata Power (up 7.11%); Ranbaxy (up 6.20%); Jindal Steel (up 3.71%); Bharat Petroleum Corporation (up 3.28%) and Jaiprakash Associates (up 2.34%). Siemens (down 3.26%); Reliance Communications (down 2.67%); L&T (down 2.08%); Bharti Airtel (down 2.01%) and Sterlite Industries (down 1.78%) settled lower.

Markets in Asia settled mostly lower on concerns about global growth and its impact on quarterly earnings of corporates. A weak trend in the US markets overnight also weighed on the markets.

The Shanghai Composite tanked 1.43%; the Hang Seng dropped 1.32%; the Nikkei 225 declined 0.67%; the Straits Times fell by 0.85%; the Seoul Composite slipped by 0.85% and the Taiwan Weighted tumbled 2.06%. Bucking the trend, the Jakarta Composite gained 0.365 and the KLSE Composite rose 0.11%. At the time of writing, the key European indices were down between 0.89% and 1.12% and the US stock futures were trading lower.

Back home, foreign institutional investors were net sellers of shares totalling Rs148.06 crore on Wednesday while domestic institutional investors were net buyers of stocks aggregating Rs73.03 crore.

Essar Oil today announced completion of Rs8,300-crore expansion of its Vadinar oil refinery in Gujarat that will boost company's turnover by 30-35%, besides improving margins. The Vadinar Refinery is now India’s second largest single-location refinery, with an annual capacity of 18 million tonnes (up from 14 million tonnes currently) and a complexity of 11.8, which also makes it among the world's most complex refineries. The stock declined 0.19% to close at Rs52.40 on the NSE.

Conglomerate Adani Enterprises may spend close to Rs3,400 crore for adding as many as 17 more ships to its current fleet by 2020. The company which owns two vessels for ferrying fuel from its overseas coal mines, recently acquired one more ship for the purpose. The stock jumped 4.50% to settle at Rs297 on the NSE.

Pharma major Lupin expects its US business will grow 20-25% in fiscal 2012-13 (April-March), helped by a strong pipeline of generic drugs. The company is also expecting over 20% growth in its India operations. The stock settled 0.51% higher at Rs519.25 on the NSE.

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