Market Close : Finally a fall, Heavyweights under pressure..

Rally at the started was witnessed with dowsides at the close. Market trade on cautious mode after opening strong. FII's have been net sellers in cash and Fno too while Domestic funds were buyers. This shows FII's are exiting their positions. Market trade in yoyo fashion as the investors traded cautious. Indices witnessed profit booking at high levels as it lost ground in the late sessions and fell in the red zone but managed to recovered as value buying was seen in almost all segments but the power sector stocks were the front runners. RIL some how kept its hold on the market after Morgan Stanley raised the price target on the stock by 25% to 3,150 and its earnings forecast on RIL by 4% for the year ending 31 March 2008. But RIL alone couldnt hold the market for long as the market saw heavy profit bookings in the last hour of trade with index heavy weights leading the way.

Banking and telecom stocks led the decline with Auto majors like Tata Motors and Maruti Udyog followed them. L&T witnessed heavy selling pressure towards the end as it was down by 4%. Some of the Reliance group shares tumbled with RPL leading the way. All BSE Sectoral Indices end in the red Except the Realty Index which showed ended marginal in green. Small and Mid caps could not sustain the selling pressure as both ended in Red. Metals and oil & gas stocks continue to see selective action with some value buying seen in stocks like GAIL, Hindalco and Nalco. Another sector which was in favour with the investors was the Fertilizer sector which saw good value buying.


In Auto stocks 4 wheelers ended weak but two wheelers like Bajaj Auto and Hero Honda ended up. As per some reports, Bajaj Auto has picked up a 14.5% stake in Vienna based sports bike manufacturer KTM Power Sports for more than Rs 300 cr. KTM which is the second largest sport bike maker in Europe will be using Bajaj's Chakan plant to locally produce their bikes and engines for the Indian and south east Asian markets. The alliance apart from enabling Bajaj Auto to take over the distribution of KTM products in India and South East Asia, will also provide access to the European market through acquisition. KTM is into producing sports bike which are above 250cc and go up to almost 900+ cc. The Indian markets are not made for these types of bikes as the Indian mentality is to have bikes with better mileage and the efficiencies. The market for such sports bikes are very niche in India. But, Bajaj being the only distributor for KTM for its Asian territory saw Bajaj end up in green.

Titan announced spectacular numbers. Revenues were up over 35% and profits grew by 45%. Watches is high margin business which grew by over 20%. Jewelry business grew by over 45% with higher gold prices and of course volume growth as well with a higher retail network. Titan now has 223 World of Titan outlets, 100 Tanishq outlets (earlier 80) and 17 Gold Plus (earlier 10) outlets. Going ahead we see that the eyewear and the precision engineering are expected to bring in the extra. However, at current valuations of 45 X FY09 leaves nothing on the table near term. As per some market reports, Reliance Retail will make its jewelry foray with the launch of Reliance Jewelry this Diwali. Reliance will be the second corporate after the Tatas to enter the Rs 70,000 crore Indian jewellery industry, which is dominated by almost 3 lakh traditional family jewellers. Some competition is building up in the jewelry segment which has grown really fast and with Reliance foray in this means some hard tuff fight for Titan is there. Today we proved the power of WOW as the negative note on Titan and the short call went hand on hand is delivering superb profits.

Technically Sepaking: Weaik trade with Declines outnumbering Advances. Tunover was low at Rs 9840cr. The market trend is slowly weakening, though there are few pleasant moves in the midcaps (as we had expected). Sensex supports are at 19260 and 19075. The large caps are likely to be strong once again only if Sensex stabilise above 20000.