Market Close: correction or consolidation?

With strong global cues the market opened on positive note. Sensex moved swiftly in the early hours of trade but then investors started booking profits at the higher level. Market traded in a volatile mood with no clear direction and with every hour passing by it looked as if indices would end in negative territory....but Index heavyweights like Reliance Communications, Bharti Airtel and Ranbaxy held the indices to end up. Auto and Consumer Durables stocks weighed heavy on the indices while selective buying was seen in Pharma, Software and Banking stocks. Heavy selling was seen in Mid and Small Caps. Asian markets ended firm while European markets traded in a mixed bag.

Sensex ended up by 11 points at 13949. It was helped by gains in Ranbaxy (391.1,+2 percent), BHEL (2621.3501,+1 percent), Hindalco (177.7,+1 percent), Bharti Tele (646.8,+1 percent) and ICICI Bk (870.85,+1 percent). Restricting the gains are Rel Energy (542.3,-2 percent), Cipla (248.05,-2 percent), ACC (1145.15,-2 percent), ITC (187.5,-1 percent) and Guj Ambuja (140,-1 percent). topnew.gif (1104 bytes)

Dollar...weakness to continue; Technically support at 13847 - 13753

ONGC is in talks with Exxon Mobil to discuss various options for its share of gas from the Sakhalin fields in Russia. The Indian E&P major has been negotiating pricing issues with the Exxon Mobil consortium for importing liquefied natural gas to India from the Sakhalin gas fields. ONGC is also considering either giving the entire gas (ONGC Videsh's share in Sakhalin-I) to Sakhalin-II project or selling it to buyers in Japan or China. ONGC had earlier held discussions with Exxon Mobil for bringing in the gas as LNG, instead of selling it through a pipeline to a captive single buyer. Meanwhile, ONGC has already brought one cargo of Sakhalin crude to India and the second is expected by the end of this month. Oil production at Sakhalin-1 block is expected to reach the optimum level in 1QFY08 and fetch India 50,000 barrels per day of oil, besides gas. Inherent nature of natural gas requires it to be converted into LNG before transportation. Thus, ONGC is trying to get LNG via Exxon Mobil from the blocks. ONGC and GAIL both ended up but marginally on back of this news.

As per the morning daily, the recent price hikes in the FMCG sector is not going to be the last one in the next six months. As per the industry players consumers should now get used to biannual price hikes as input and raw material prices continue to rise, with no respite in sight. The top management of one of the FMCG major Says FMCG companies will continue to pass the burden of increased costs to consumers. The management also added that FMCG companies may make it a norm to hike prices twice a year. The next round of price hike for could happen in the next 5-6 months. FMCG counter was mixed except Dabur whcih was up by 1.3%.

Iran replaces $ with ? in most oil dealings. Iran has decided to replace dollar with euro in its foreign trade given the continual impediments and hostile policies directed by U.S. toward the country. Dollar has been depriciating as China would divert its foreign investment. We could see more weakness in Dollar as funds shift to other currency. IT counter witness some pressure.

Technically Speaking: Market was volatile with no clear direction. Index continued with choppy sessions and finally closed marginally up by 11points. Sensex traded in the region of of 13847- 14035 levels. Volumes were good at 4541 cr. However, the breadth had been in the favor of Decliners as they were 1.77 times the Advances. The Support lies at 13847 - 13753 while Resistance is at 14128 -14033 level.