Daily Call - June 30 2008

Prime Minister Singh may have finally had his way, if the Saturday endorsement by Mrs. Gandhi is anything to go by. The Nuclear Deal may finally be on and Dr. Singh may finally get to go to Japan for the G8+5 meeting. It remains to be seen whether the SP will want to support the UPA with TDP, AIDMK and JD staying out. While the cat may not be out of the bag before July 3, the nuclear power related stocks will be dusted off today as we open the trading this week.

On Friday, the indices had closed at their lowest levels of the day, which indicated continued weakness. The massive negative cost of carry further added to the gloomy scenario. However, because of the glimmer of hope of the nuclear deal, stocks could bounce early in the morning and short covering can happen. So for the moment, approach today’s trade with an open mind and short covering stance. A breaking of the 4090 level should make you go back to your bearish ways.