Raging Bulls set to get ahead
There are plenty of ways to get ahead.
The first is so basic I'm almost embarrassed to say it: Spend less than you earn.
The raging bulls look set to pounce on the bears who had barely made their entry last Friday. This Friday promises to be a different story. We expect a gap-up opening, on the back of the rally across global markets. Higher oil prices could dampen the sentiment. And some cooling cannot be ruled out after a strong start. Watch out for the advance tax numbers for the October-December quarter for more clues on the health of India Inc. When everything looks fine remember to keep increasing your stop losses. Real estate stocks look set for another run.
The bulls have fought their way back smartly in the last couple of sessions. Half the losses that the Sensex suffered since last Friday have been reversed in just two days. A job well done considering the grim start to the week. So now, where do we go? Up or down? And, how intense will be the move either way? These are tough questions, which only the market can answer. The market will remain volatile in the next few days. FIIs may take it easy towards the holiday season. In short, the market may remain range-bound with short term spikes either way.
In the interim, if there is any negative news, like another rate hike by the RBI, a spike in oil prices or soft economic numbers, the bears could raise their ugly head yet again. This is definitely one of the toughest times in the market. A carefully crafted stock specific approach is the right way to go.
FIIs were net buyers to the tune of Rs4.8bn (provisional) in the cash segment on Thursday. They were net sellers of Rs969mn on Wednesday. Mutual Funds offloaded shares worth Rs2.32bn on the same day.
Our five short- term recommendations given on Thursday performed exceptionally well. Gayatri Projects rose by over 10% and Titan Industries added over 6%. Also, Godrej Industries climbed by 4%.
Aurobindo Pharma's Board will meet today to consider the proposal for merger of APL Life Sciences and Senor Organics, the wholly owned subsidiaries of the company, with itself.
Subex Azure's Board will meet today to consider calling an EGM for approving the proposed issue of sponsored GDRs. Crew BOS Products' Board will meet today to consider a preferential allotment and plans to raise funds up to US$25mn.
US stocks rallied on Thursday with the Dow Jones Industrial Average carving out a new record close and the S&P 500 touching a more than six-year high, thanks to upbeat earnings from the banking sector, a drop in jobless claims and a rebound in technology.
Gains in energy shares lent support, after crude jumped above $62 per barrel. The Organization of Petroleum Exporting Countries (OPEC) said that it will cut output by another half a million barrels a day starting Feb. 1.
The Dow climbed 99.26 points, or 0.8%, to 12,416.76, surpassing its previous high of 12,342.56 set on Nov. 17. The S&P 500 added 12.28 points, or 0.9%, to 1425.49, a six-year high. The Nasdaq jumped 21.44 points, or 0.9%, to 2453.85.
US light crude oil for January delivery surged $1.14 to settle at $62.51 a barrel on the New York Mercantile Exchange. The front-month contract was quoting nearly unchanged at $62.50 per barrel in extended trading in Asia.
Treasury prices fell, with the yield on the benchmark 10-year note rising to 4.60% from 4.58% late on Wednesday. In currency trading, the dollar rose against the yen and euro. COMEX February gold slipped $1.50 to settle at $630.90 an ounce.
Indian ADRs closed sharply higher. Patni was up close to 3%, VSNL surged by nearly 5%, Infy added 2.2%, Wipro advanced 3.2%, Satyam gained 3.6%, Tata Motors climbed 3.3%, Dr. Reddy's put on 3.6%, HDFC Bank rose by over 4%, ICICI Bank jumped 4.4% and MTNL added 1.3%.
European shares gained ground. The UK's FTSE 100 closed up 0.6% to 6,228. Germany's DAX Xetra 30 gained 0.5% to 6,552.58. In France, the CAC-40 added 0.6% to 5,509.58. The pan-European Dow Jones Stoxx 600 index rose 0.6% to 364.16.
All the emerging markets closed higher as well. The Bovespa in Brazil gained 1% to 43,754 while the IPC index in Mexico was up 0.7% at 25,863 and the RTS index in Russia added 0.6% to 1840.
Asian stocks rose for a fourth day on Friday, the longest rally in almost two months. Honda and Hynix Semiconductor led gains after US companies reported higher profits, lifting the Dow to a record.
Fanuc led Japanese shares higher after the Bank of Japan's Tankan survey showed that business confidence rose to a two-year high. BHP Billiton and Inpex Holdings climbed after prices of copper and oil gained.
The Morgan Stanley Capital International Asia-Pacific Index gained 0.3% to 138.22 at 10:53 a.m. in Tokyo, adding to a three-day, 1% rally. The index is set for its fifth consecutive weekly gain. All regional benchmarks rose, with indexes in Australia and Singapore heading for records.
Japan's Nikkei 225 Stock Average added 103 points to 16,932. The Hang Seng in Hong Kong advanced 166 points to 19,086. The Kospi in Seoul was up 5 points at 1423 while the Taiex in Taiwan rose 60 points to 7540 and the Straits Times in Singapore climbed 25 points to 2841.
Major Bulk Deals:
Bear Stearns has sold Aarvee Denim; Birla Sunlife MF has purchased Bharat Bijlee; Prudential ICICI MF has sold Century Textiles; Kotak has sold Dynamatic; Fidelity has bought Eastern Silk; Citigroup Global has picked up Gayatri Projects; HSBC Financial has sold Hindustan Motors.
Market Volumes:
The turnover on NSE was down by 16% to Rs80.87bn. BSE Consumer Durable index was the major gainer and gained by 3.97%. BSE Technology index (up 2.71%), BSE Bank index (up 2.58%), BSE FMCG index (up 2.48%) and BSE Capital Good index (up 2.35%) were the other major gainers.
Volume Toppers:
IFCI, Teledata Informatics, SAIL, HLL, Zee, IVRCl Infra, Parsvnath Developers, NTPC, Century Textiles, Unitech, India Cements, Bank of India, Indiabulls, Reliance Industries, GMR Infra, Voltas, RPL, ITC and Polaris.
Upper Circuit Filters:
Fedders Lloyd, Nirlon, Ansal Infrastructure, BPL Ltd, LMW, Eicher Motors and Flex Industries.
Delivery Delight:
BEL, BHEL, Bombay Dyeing, Canara Bank, CEAT, Century Textiles, Cipla, Divis Laboratories, Dr Reddys Laboratories, Godrej Industries, HCL Technologies, Hindustan Lever, ICICI Bank, Indian Hotels, NDTV, Punj Lloyd, Sun TV, Tata Power, Tata Tea and VSNL.
Brokers Recommendations:
Areva T&D – Buy from Brics Securities
Long Term Investment:
Maruti
Major News Headlines:
Tata Motors, Fiat to start building cars, engines beginning 2008
Ranbaxy gets FDA approval to sell generic version of Cefzil
Spanco Tele Board to meet on Dec 20 on fund raising plan
HCL Tech announces 1;1 bonus
Punj Lloyd sets up Engineering Services Outsourcing firm
L&T secures $86mn order from China
Maruti to raise car prices in January
Accentia Tech to acquire BPO companies in US
Kale Consultants wins order from SkyTeam alliance
Federal-Mogul to mull Rights Issue on Dec 21