Market Close: Pull back rally !

Global cues led to positive start for markets. Profit booking crept in as a result indices slept into red. Session was extremely choppy. However later in the day buying activity intensified across major sectoral indices along with small and mid caps. Buying activity was witnessed on Auto, Banking, Cement and Engineering counters. Strong rupee continues to impact the technology counter. European indices were trading in red after starting in green.

ICICI Bank's FPO offer worth Rs.8,750 cr witnessed an overwhelming response for the investors. The FPO got fully subscribed within minutes after the issue opened. The FPO was over subscribed by 2.6 times by the end of the first day of opening. HTMT Global which got relisted at Rs.650 ended lower in discount. Decolight Ceramics which got listed today in premium also ended in discount. Educomp was the star of the day with gains of 14.5%. Kotak put out a positive view. We have a note on this one..do read it.

Sensex closed higher by 215 points at 14295.5. It was helped up by gains in SBI (1372.4,+4 percent), L & T (1995.7,+4 percent), TISCO (608.85,+3 percent), RIL (1727.15,+3 percent) and RCVL (503.6,+3 percent). Restricting the gains were Satyam (468.45,-2 percent), Infosys (1956.85,-2 percent), TCS (1160.6,-1 percent), Cipla (207.45,0 percent) and Wipro (521.25,0 percent).

Zicom ended 2% lower. The company announced a strategic tie-up with Future Media for retailing its products from exclusive Zicom retail counters placed in 100 outlets of Future Group's select retails formats. These formats include Big Bazaar, Brand Factory, Collection I, Central, E Zone, Electronic Bazaar, Food Bazaar, Furniture Bazaar, M Port, WSC, etc. The Company has entered the retailing domain with 'Zicom Consumer Service Group' in order to provide complete security solutions to homes, offices, residential and more. Popular among them are Burglar Alarm Systems and Video Door phones for homes, CCTV Surveillance Systems for SME's, shops, Multi Apart Video Door Phones for Buildings and Finger print locks. All of them are easy to operate and secure one's premises at the click of a button. Bennet and Colemen had recently acquired a stake in the company. Company is aggressively trying to market the security solutions.

Financial Technologies ended a percent lower. There was news of income tax department raids across 16 establishments of the commodity traders across the country. The raid was conducted by the IT officials as a part of search & survey operation at 14 locations in Mumbai and 2 locations in Gujarat. MCX officials later informed that it was a routine inspection by the regulatory authorities. According to MCX officials the purpose of the raid was to find out more details regarding how the business is conducted. We are convinced by the business idea of the company. We would recommend the company as an investment option from the long term point of view. Do read our note on the company for more details.

Technically Speaking : Indices remained choppy through out the day, between an intra day high of 14,315 and low of 14,059. Breadth was in favor of advances as there were 1,397 advances against 1,180 declines. Volume for the day stood at Rs.4,326 cr. As expected, we are having a pull back rally and which is likely to face major resistance at 14360--14380. If sensex breaks below 14200 again, we might move lower upto 13880.

Soon after the market hour news of 15 Brokers being banned from F&O struck the market. Charges against the brokers are 'involved in Synchronised trading'. Really, something like this should have not much impact but it may well be the excuse for some weakness tomorrow.