Daily Call - Nov 3 2008

The latest move of RBI to cut SLR, CRR and Repo seems to be done under "guidance" of north block, and not an independent regulator's thoughtfully taken action. How else would you justify the RBI action just a week after the formal policy meeting, at which the Governor just twiddled his thumbs and did nothing? Has anything transpired in the intervening period that would have warranted this move?


Frittering away with policy ammunition when environment is tough makes us worried on one bastion of RBI, which was earlier well taken care of under our good old jovial man, Dr.Reddy.


When markets opens higher with a gap, index would have retraced 30% from its low it touched on 27th October. It is natural to expect profit booking at higher levels. Sensex has resistance at 10250, which is 380 points higher from its Friday close. 10800 and 11800 are the two major hurdles on way up, while support comes in at 8900.








Steel companies had to lower the prices to stay afloat, just a day after government withdrew 15% export duty does not auger well for the long term, though stock may gain with broader markets. Select PSUs and Midcap are the best place to hide when storm approaches.