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Tuesday, June 08, 2010
Stock Picks and Recommendations
Stocks with Buy rating:
Mahindra & Mahindra
Current market price: Rs 545
Target price: Rs 725
Upside: 33.02%
Brokerage: Emkay
Recommendation: Buy
Sensex ends lower on European woes
Indian equities continued to drop for the second day on Tuesday. At the close, the benchmark 30-share index, BSE Sensex lost 163.97 points or 0.98% at 16,617.10. Meanwhile, the broad based NSE Nifty fell by 46.90 points or 0.93% at 4,987.10.
Sensex Movers
ICICI Bank contributed fall of 36.54 points in the Sensex. It was followed by Reliance Industries (30.24 points), Bharti Airtel (16.54 points), Hindalco Industries (14.76 points) and Infosys Technologies (10.53 points).
Nifty June 2010 futures below 5,000
Turnover rises
Nifty June 2010 futures were at 4,963, at a discount of 24.10 points compared to spot closing of 4,987.10. Turnover in NSE's futures & options (F&O) segment increased to Rs 86,540.16 crore from Rs 80,625.72 crore on Monday, 7 June 2010.
Nifty below 5K on Euro zone worries
Today's major news
Bharti closes Zain deal; the stock closes 3.77% lower
Punj Lloyd bags Rs179.90-crore order; the stock ends 0.60% down
JSW Steel May crude steel production up 23%; the stock closes 1.88% lower
BSE Bulk Deals to Watch - June 8 2010
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
8/6/2010 517356 ACI Infocom ALLWELL INVESTMENTS PVT LTD S 60000 22.23
8/6/2010 532975 Aishwarya Tele RAMYA PENDRU B 150000 29.06
8/6/2010 512247 Ashirwad Cap SWASTI VINAYAKA INVESTECH LIMITED S 200000 2.50
8/6/2010 531591 Bampsl Sec PRAKASHCHAND GUPTA B 416500 1.38
8/6/2010 511607 Birla Shloka PARAM COMMODITIES PRIVATE LIMITED B 96500 72.83
NSE Bulk Deals to Watch - June 8 2010
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
08-JUN-2010,EVERONN,Everonn Education Limited,GRANTHAM MAYO VAN OTTERLOO AND CO LLC A/C TRESURER OF THE S,BUY,110000,388.17,-
08-JUN-2010,KARURKCP,Karur K.C.P. Packkagings,DYNAMIC STOCK BROKING (I) PRIVATE LIMITED,BUY,88415,63.10,-
08-JUN-2010,KARURKCP,Karur K.C.P. Packkagings,SAR AUTO PRODUCTS LIMITED,BUY,49673,64.14,-
08-JUN-2010,RANASUG,RANA SUGARS LTD,EDELWEISS ESTATES P LTD,BUY,1717515,12.03,-
08-JUN-2010,TARAPUR,Tarapur Transformers Ltd,RAINDROP FINANCIAL SERVICES PVT LTD,BUY,104386,38.75,-
08-JUN-2010,IPCALAB,Ipca Laboratories Ltd.,CAPITAL RESEARCH & MANAGEMENT COMPANY A/C NEW WORLD FUND IN,SELL,1078838,275.42,-
08-JUN-2010,KARURKCP,Karur K.C.P. Packkagings,DYNAMIC STOCK BROKING (I) PRIVATE LIMITED,SELL,96435,62.59,-
08-JUN-2010,KARURKCP,Karur K.C.P. Packkagings,SAR AUTO PRODUCTS LIMITED,SELL,142370,57.18,-
08-JUN-2010,PROVOGUE,Provogue (India) Limited,INDIANIVESH SECURITIES PRIVATE LIMITED,SELL,592059,49.25,-
08-JUN-2010,RANASUG,RANA SUGARS LTD,EDELWEISS ESTATES P LTD,SELL,1067853,12.15,-
08-JUN-2010,RANASUG,RANA SUGARS LTD,KII DR.,SELL,795000,12.03,-
08-JUN-2010,RANASUG,RANA SUGARS LTD,KII LTD DR,SELL,1040000,12.00,-
08-JUN-2010,TARAPUR,Tarapur Transformers Ltd,RAINDROP FINANCIAL SERVICES PVT LTD,SELL,104386,38.26,-
Stocks up in Asia but sentiments still jittery
Dow futures ease sharply; Gold hits fresh highs as risk aversion comes back in play
Stocks were mostly up in Asia but the gains were limited as the traders were not willing to factor in a sustained improvement in the world economic conditions amid the chronic debt crisis in the European nations. The markets managed to eke out small gains but the buyers lacked a convincing spirit and their concerns were seen to be turning correct as the DOW futures dropped from around 90+ in the Sidney trades to slid into negative zone. The US dollar also came off the lows to quote around 1.1920, pressurizing the broad commodity prices and resource linked stocks in turn.
Telecom, metal shares lead decline
The key benchmark indices declined for the second straight day as European shares faltered. The BSE 30-share Sensex lost 163.97 points or 0.98%, off close to 280 points from the day's high and up about 55 points from the day's low. The 50-unit S&P CNX Nifty fell below the psychological 5,000 level. US index futures edged higher in volatile trade. Index heavyweight Reliance Industries (RIL) fell. Metal, banking and realty stocks declined. But, FMCG stocks were in green.
The Sensex has lost 500.59 points or 2.9% in the past two trading sessions after jumping 1,095.21 points or 6.83% in eight trading sessions to 17,117.69 on 4 June 2010, from recent low of 16,022.48 on 25 May 2010. The Sensex has lost 1,352.92 points or 7.5% from a recent peak of 17,970.02 on 7 April 2010. It has lost 4.85% in calendar 2010 so far after jumping 81% in 2009.
Euro zone debt worries caused massive outflow of foreign funds from India recently as investors shunned risk. Foreign funds sold shares worth a net Rs 832.21 crore in the first six trading sessions this month, as per data from the stock exchanges. Foreign institutional investors (FIIs) had dumped shares worth a net Rs 12071.14 crore in May 2010.
Domestic funds have absorbed part of the selling by FIIs. Domestic funds bought stocks worth a net Rs 166.75 crore in the first six days this month. Domestic funds bought stocks worth a net Rs 6361.17 crore in May 2010.
Coming back to today's trade, the market was choppy. The market recovered after an initial slide on firm Asian stocks. The market extended gains in morning trade. The market trimmed gains in mid-morning trade on profit taking. The key benchmark indices regained strength in early afternoon trade. The Sensex hit a fresh intraday high. The market came off the higher level later. A sell-off gripped the market in mid-afternoon trade. The market recovered from lower level after hitting a fresh intraday low.
NSE's volatility index, India VIX, rose 2.79% to 28.77. The index, which is a gauge of traders' perception of near-term risks in the market based on options prices, had jumped 13.23% to 27.99 on Monday, 7 June 2010. India VIX is calculated based on the S&P CNX Nifty options prices. India VIX is a measure of the market's expectation of volatility over the next 30 calendar days.
European shares turned negative, with banks surrendering early gains, with worries about the euro zone's debt crisis persisting. The key indices in the Germany, UK and France were down by 0.87% and 1.08%.
Commodity producers led Asian stocks higher on Tuesday after Federal Reserve Chairman Ben Bernanke said the US economic recovery is intact. The key benchmark indices in China, South Korea, Japan, Indonesia, Hong Kong rose by between 0.09% to 1.08%. The key benchmark indices in Taiwan and Singapore fell by between 0.08% to 0.19%.
US index futures edged higher in volatile trade. Trading in US index futures indicated that the Dow could rise 32 points at the opening bell on Tuesday, 8 June 2010.
US Stocks fell on Monday 7 June 2010, taking S&P 500 to its lowest close in seven months, as industrial and technology shares fell. The Dow Jones Industrial Average lost 115.48 points, or 1.16% to 9,816.49. The Standard & Poor's 500 Index slid 14.41 points, or 1.35% to 1,050.47. The Nasdaq Composite Index tumbled 45.27 points, or 2.04% to 2,173.90.
Back home, the Indian government on Monday deferred till next week a decision on raising fuel prices, the second time in a year it has tripped on pushing politically-sensitive reform measures that could help trim a budget deficit. The Congress-led government held off the decision after two powerful ministers from coalition parties stayed away from a ministerial panel meeting, signalling opposition to the move on fears of voter backlash ahead of local polls over the next year.
The panel was to review the possibility of freeing up petrol prices and cutting subsidies on diesel, kerosene and cooking gas which could help reduce the fiscal deficit from the projected 5.5% of 2010/11 GDP and free up revenues for other programmes.
On the monsoon front, the southwest monsoon rains have revived after being stalled by a cyclone last week. According to the India Meteorological Department (IMD), the monsoon has advanced to some parts of the central Arabian Sea, most parts of coastal Karnataka and some parts of south interior Karnataka. The monsoon is expected to advance further in the next couple of days.
The monsoon rains were 11% below normal in the week to 2 June 2010, the weather office said on Thursday, 3 June 2010. The June-September monsoon rains hit Kerala on 31 May 2010, a day ahead of schedule. The south-west monsoon usually covers the entire country by mid-July. The weather office late April 2010 said rainfall is likely to be 98% of the long-term average. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation.
Last month, Australia's weather bureau said the El Nino weather pattern was over. El Nino is caused by an abnormal warming of the eastern Pacific Ocean and can play havoc with weather patterns across the Asia-Pacific region.
The south west monsoon is important for India as about 60% of the country's farmlands are rain-fed and more than half of the workforce is employed in the agriculture sector. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season also holds key.
Data last week showed business activity remained strong for India's vast services sector in May 2010, with a key gauge growing for a 13th consecutive month even as some momentum was lost over the previous month. The HSBC-Markit Business Activity Index stood at 58.2 in May 2010 from a 21-month high of 62.1 in April 2010. A reading above 50 indicates expansion. Services make up about 55% of India's $1.2 trillion economy.
HSBC Markit Purchasing Managers' Index (PMI), based on a survey of 500 Indian firms, surged to a 27-month high of 59 in May 2010 from 57.2 in April 2010, bolstered by steady growth in output, new orders and employment. The rate of growth had slowed in March 2010 and April 2010.
On a flip side, another data showed that the food articles index rose 16.55% in the year to 22 May 2010, accelerating from previous week's rise of 16.23%. The primary articles index, which also includes food articles, rose 16.89%, higher than previous week's 15.90% rise. The fuel price index increased to 14.14 % versus 12.08% rise in the previous week.
India's economy grew at 8.6% in the March 2010 quarter driven by robust manufacturing sector on the back of government and consumer spending, data released by the government on Monday, 31 May 2010, showed. The growth was significantly higher than the revised 6.5% expansion in Q3 December 2009 and a 5.8% growth in Q4 March 2009. The manufacturing sector grew 16.3%, farm output rose 0.7%, mining sector expanded 14% and services increased by 8.4% in January-March 2010 quarter from a year earlier.
For the full year to March 2010, the economy expanded 7.4%, above a government forecast of 7.2%. Economic growth had slowed down to 6.7% in year ended March 2009.
The RBI expects India's economy to expand 8% in the year ending March 2011 (FY 2011) with an upward bias, assuming a normal monsoon this year and sustenance of good performance of the industrial and services sectors on the back of rising domestic and external demand. The RBI at its annual policy review on 20 April 2010 said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted. Meanwhile, a revenue bounty for the government from the sale of telecom spectrum would help bring down fiscal deficit in the current financial year.
Investors will eye the first installment of the corporate advance tax payment which will give some clue about Q1 June 2010 corporate results. The first installment of corporate advance tax falls due on 15 June. The combined net profit of a total of 3,589 companies rose 13.7% to Rs 87,226 crore on 24.70% rise in sales to Rs 9,27,456 crore in the quarter ended March 2010 over the quarter ended March 2009.
The BSE 30-share Sensex fell 163.97 points or 0.98% to 16,617.10. The Sensex jumped 114.66 points at the day's high of 16,895.73 in early afternoon trade. The Sensex fell 220.43 points at the day's low of 16,560.64 in late trade.
The S&P CNX Nifty declined 46.90 points or 0.93% to 4,987.10.
The BSE Mid-Cap index fell 0.55%. The BSE Small-Cap index fell 0.55%. Both these indices outperformed the Sensex.
Except BSE FMCG index all the other sectoral indices on BSE fell. BSE Realty index (down 2.57%), Metal index (down 2.19%), Oil & Gas index (down 1.38%), Teck index (down 1.37%), Banking sector index Bankex (down 1.19%) and Consumer Durables index (down 1.18%), underperformed the Sensex.
FMCG index (up 0.69%), BSE Healthcare index (down 0.25%), Power index (down 0.27%), Capital Goods index (down 0.36%), PSU index (down 0.66%), IT index (down 0.75%), Auto index (down 0.96%), outperformed the Sensex.
The market breadth, indicating the overall health of the market, turned weak. The breadth reversed course - it was strong earlier in the day. On BSE, 1688 shares declined as compared with 1134 that advanced. A total of 108 shares were unchanged.
From the 30 share Sensex pack, 23 fell and rest rose.
BSE clocked turnover of Rs 3449 crore, higher than Rs 2934.10 crore on Monday, 7 June 2010.
Index heavyweight Reliance Industries (RIL) fell 1.28% to Rs 996.45. The stock came off the day's high of Rs 1013.40. RIL may reportedly foray into nuclear energy after being freed from a non-compete agreement with the Anil Dhirubhai Ambani Group (ADAG) that barred it from investing in some businesses, including power. Recently, reports had also suggested that RIL may make its first big-ticket investment in coal-fired power plants.
India's second largest mobile services provider by sales Reliance Communications (RCom) fell 4.69% on profit taking after a recent sharp surge. The company's board on Sunday, 6 June 2010, gave an in-principle approval for induction of strategic/private equity investors into the company. The approval is for sale of up to 26% stake. The RCom stock had jumped 14% last week, with speculation rife that Abu Dhabi's Etisalat and South Africa's MTN could be potential partners. However, MTN had denied merger talks with the firm.
India's largest mobile telecom services provider by sales Bharti Airtel fell 3.77% after company announced that it has completed the acquisition of Zain Group's (Zain) mobile operations in 15 countries across Africa for an enterprise valuation of $10.7 billion.
India's largest cigarette maker by sales ITC rose 0.78%. The stock hit an all-time high of Rs 292.45 today. The board of the company will meet on 18 June 2010 to consider the bonus share issue. The company had last issued bonus shares in the ratio of 1:2 in 2005.
India's largest FMCG maker by sales Hindustan Unilever rose 0.26%, extending recent gains. The company said after market hours on Thursday, 3 June 2010, that its board of directors will meet on 11 June 2010 to consider buyback of shares.
Among other FMCG stocks, United Spirits, Nestle India and Dabur India rose by between 0.65% to 1.36%.
Metal stocks reversed initial gains. Jindal Steel & Power, Hindalco Industries, Hindustan Zinc, Steel Authority of India, Sterlite Industries, National Aluminum Company fell by between 0.2% to 5.81%.
India's largest steel maker by sales Tata Steel fell 2.19%, reversing early gains. The company announced before the market hours today that its subsidiary has raised stake in Canadian mining firm New Millennium Capital Corp (NML). The company now holds 27.4% outstanding shares of NML.
Some high beta realty stocks fell. HDIL, DLF, Indiabulls Real Estate, Unitech, Phoenix Mills, Peninsula Land, Parsvnath Developers fell by between 0.36% to 3.97%.
Banking stocks reversed initial gains. India's largest bank in terms of branch network State Bank of India fell 0.12%. Among other state-run banks, Bank of India fell 1.07% and Punjab National Bank was flat. Bank of Baroda fell 1.56%. The stock had hit record high of Rs 753.35 on Monday.
India's largest private sector bank by sales ICICI Bank fell 3%. Its ADR fell 3.06% on Monday, 7 June 2010. India's second largest private sector bank by sales HDFC Bank fell 1.05%. Its ADR fell 2.53% on Monday, 7 June 2010.
Bank credit to businesses and individuals has seen a pick-up of around Rs 5,600 crore while deposits with banks have fallen by nearly Rs 5,000 crore during the fortnight ended 21 May 2010.
Some capital goods stocks fell on profit taking. ABB, Larsen & Toubro, Praj Industries, Crompton Greaves, Punj Lloyd fell by between 0.6% to 1.43%.
IT stocks fell on disappointing US non-farms payroll data for May 2010. US is the biggest market for the Indian IT firms. India's second largest software services exporter by sales Infosys fell 0.65%, with the stock falling for the second straight day. Its ADR fell 2.15% on Monday, 7 June 2010. India's largest software services exporter by sales TCS fell 0.41%, with the stock falling for the second straight day.
India's third largest software services exporter by sales Wipro fell 1.35%. Its ADR fell 2.47% on Monday, 7 June 2010. The company announced during market hours on Monday that it has fixed 16 June 2010 as the record date for issue of bonus shares in the ratio of 2:3.
Cals Refineries clocked the highest volume of 1.19 crore shares on BSE. SpiceJet (1.09 crore shares), Rana Sugars (92.83 lakh shares), Reliance Communications (70.18 lakh shares) and Unitech (50.16 lakh shares) were the other volume toppers in that order.
Tata Steel clocked the highest turnover of Rs 132.63 crore on BSE. Reliance Communications (Rs 117.66 crore), State Bank of India (Rs 95.34 crore), Sesa Goa (Rs 93.60 crore) and Tata Motors (Rs 81.78 crore) were the other turnover toppers in that order.
Market may recover on higher Asian stocks
The market may edge higher as Asian stocks reversed initial losses. Asian stocks had opened lower tracking sell-off in US stocks on Monday, 7 June 2010. Trading in S&P CNX Nifty index futures on the Singapore stock exchange indicated a flat opening on the domestic bourses.
Commodity producers led Asian stocks higher on Tuesday after Federal Reserve Chairman Ben Bernanke said the US economic recovery is intact. The key benchmark indices in China, South Korea, Singapore, Japan, Indonesia, Hong Kong rose by between 0.09% to 0.88%. But, Taiwan's Taiwan Weighted fell 0.21%.
Grey Market Premium - Fatpipe Networks India
| Company Name | Offer Price (Rs.) | Premium (Rs.) |
| Standard Chartered PLC | 104 | Discount |
| Fatpipe Networks India Ltd. | 82 to 85 | 2 to 3 |
Crude registers marginal drop
Global economic health concerns push prices lower
Crude oil prices ended little lower on Monday, 07 June 2010. Concerns regarding global economic health pushed prices lower.
On Monday, crude-oil futures for light sweet crude for July delivery closed at $71.4/barrel (lower by $0.07 or 0.1%). Last week, prices shed 3.3%. However, the contract seemed to stabilize after last week's sharp decline in the wake of a lackluster U.S. jobs report and renewed European debt concerns.
Bright day for bullion metals
Prices rise considerably higher due to a rally in gold priced in Euros
Bullion metal prices shot up on Monday, 07 June 2010 at Comex. A rally in gold priced in Euros, supported by a flight to safety, helped push precious metals futures higher today. Concerns regarding global economic health also pushed prices higher.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa. Recently, the embattled euro has played stronger role in moving prices rather than dollar fluctuation. Bullion metals have registered increase in prices despite strong dollar in recent times.
Flat start likely on Asian cues
Headlines for the day:
De-listing hopes boost MNC stocks
Vishal Retail sees deal opportunity with tpg
RMW raises stake in Fame to 15.28%
Events for the day:
Daily News Roundup - June 8 2010
Cairn India to commission its 590km heated crude oil pipeline, from its Barmer field near the Gujarat coast in early next month. (BS)
Tata Steel has bought an additional stake in Canadian mining firm New Millennium Capital for around Rs892mn raising its stake to 27.4%. (ET)
NTPC has readied a war chest of around Rs1,600bn for the next five years even as it closes in on a coal mine in Western Australia to source fuel for its power projects. (BL)
SpiceJet has applied afresh for permission to operate in the growing route of Colombo. (BS)
GSPC through its subsidiary GSPC Gas Company Limited has reached to around 1,50,000 PNG domestic customers as well as daily gas sale of 3 mmscmd in the Gujarat. (BL)
Andhra Bank is likely to buy back its shares from the open market soon. (BL)
Maytas Infra has won a contract worth Rs1.85 billion to build part of a metro rail network in Gurgaon. (FE)
Reliance MediaWorks along with two other ADAG firms has acquired a further 0.25% stake in Fame India, thereby increasing their combined holding in the multiplex chain to 15.3%.(ET)
Sequent Scientific to invest Rs1.5bn in expansion plans, which include foraying into new therapeutic segment and setting up of greenfield facilities. (ET)
NTPC to make changes in its bidding process for sourcing equipment that will cut down overall project cycle and prevent delays in completion of projects. (ET)
Banks raised nearly Rs620bn on a net basis on Monday through the two liquidity-adjustment facility (LAF) operations conducted by the RBI to tide over the liquidity crunch. (BS)
The Board of Approval for Special Economic Zones will consider 41 proposals on Tuesday for withdrawal or extension of formal approval and for full or partial de-notification as firms drop SEZ plans on slowdown, tax worries. (BL)
The Empowered Group of Ministers on petroleum pricing postponed the politically sensitive decision of freeing auto fuel prices from government control. (BL)
The government has set up a Technical Advisory Group for Unique Projects for creating an effective tax administration and financial governance system, through reliable secure and efficient IT projects, laying the ground for major structural reforms. (ET)
The government’s revenue from the sale of spectrum for 3G and broadband wireless access is set to cross Rs1000bn with a pan-India bid for BWA touching Rs106bn on the 12th day of the auction. At this bid amount, the government will earn ~Rs320bn from the sale of BWA spectrum alone. (ET)
The government will invest US$376mn to develop environment-friendly urban transport in the country. (ET)
The RBI is considering a proposal put forward by profit-oriented microfinance institutions to allow them to be business correspondents of banks for financial inclusion. (ET)
Step out and hope!
Hope is the power that gives us the power to step out and try.
With US markets in the dumps, and Asian markets barely in the green, the Indian indices are staring at a flat start this morning. While the psychological support remains at 5000 for the Nifty, the near-term support is seen around the 4940 levels.
A lot of action is being seen in MNC counters following expectations of disinvestment after the latest directive asking for a 25% public float for listing. The maximum impact is expected on PSUs, as each of the top 10 PSUs (by market cap) has GoI shareholding above 75%.
The main US indices came crashing especially towards the end with the Dow shedding 115.48 points, or 1.2%, to end at 9,816.49. This is below its May 6 low of 9,869. The S&P 500 index fell 14.41 points to 1,050.47 while the Nasdaq fell 45.27 points to 2,173.90.
The Asian markets didn’t mimic the US markets following Federal Reserve chairman Ben Bernanke’s view that he didn't think that the U.S. economy would slip back in to recession. He said consumer spending and business investment seem strong enough to keep the economy growing, albeit at a relatively subdued rate.
The bruised bulls will have to pin their hopes on a European market rebound. On economic front, German industrial production rose by 2.8% mom and 29.6% yoy in April. Meanwhile, European finance ministers at their meet in Luxembourg seemed in no hurry to halt the euro's slump against the dollar opining that the ‘euro's current level would be a tonic for the economic recovery.’
The Finance Minister is in Mumbai to meet a host of people including corporates. Don’t expect too many statements which could boost the market. Meanwhile, the much awaited Empowered Group of Ministers on petroleum pricing was deferred, in other words, the government failed to reach a decision of freeing auto fuel prices from government control.
The government’s revenue from the sale of spectrum for 3G and broadband wireless access is set to cross Rs1000bn with a pan-India bid for BWA touching Rs106bn on the 12th day of the auction. At this bid amount, the government will earn ~Rs320bn from the sale of BWA spectrum alone, according to a report.
After enjoying its stay above the 17,000 levels in the previous week, the Indian markets ended with a deeper cut on Monday. The benchmark indices opened with a gap down on account of the global crash witnessed over the weekend. As if concerns over the European debt crisis and weakness in the U.S. was not enough comes another cause of concern i.e Hungary. There are fears that Hungary would be the next to suffer after Greece.
"It was a boring sort of a day, where the NSE Nifty traded in a narrow trading band of mere 30 points. The Mid-Cap and the Small-Cap stocks showed some spark in opening session however it was short lived. On the positive side, the NSE Nifty has managed to hold above the 200-DMA, however today’s session lacked participation", says Amar Ambani, Vice President, Research IIFL.
Domestically, the Empowered Group of Ministers (EGoM) would meet to decide on petroleum products pricing which kept the oil stocks in action, this time they were badly battered, stocks like HPCL, BPCL and IOC were among the top losers. Stocks like Mastek shot up over 14% and RCom also was among the notable gainer.
Finally, the BSE 30-share Sensex fell 337 points at 16,781 and NSE Nifty lost 101 points at 5,034.
Markets in Asia ended in deep red; the Nikkei in Japan fell by 4%, Australia's S&P/ASX lost 3% while the Hang Seng index in Hong Kong fell 2% and Shanghai index in China lost 1.6%.
European indices also were trading in the negative terrain, the DAX in Germany was down 0.5%, the CAC 40 index in France was down 0.9% and the FTSE in the UK was down 0.8%.
All the BSE sectoral indices ended in the negative terrain, BSE Realty index was the top loser, the index was down 4%, followed by BSE Metal index was down 3.6% and BSE Consumer Durables index was down 2.1%. Even the BSE Mid-Cap index and the BSE Small-Cap index fell by 1.4% each.
Outside the frontline indices, the big losers in the broader market were Concor, Hindustan Copper, NMDC, KSK Energy and Balrampur Chini. On the other hand, gainers included REI Agro, Oracle Fin, GTL Infra and Apollo HospLakshmi Vilas Bank
Investors with a short-term trading perspective can buy the stock of Lakshmi Vilas Bank. This stock was consolidating in a wide band between Rs 70 and Rs 90 since last September. The fact that the stock has given back only one-third of the gains recorded since March 2009 implies that the medium-term outlook is positive for this stock. It is forming a symmetric triangle over the last nine months. This is a continuation pattern within an uptrend.
The short-term trend in the stock is up since May 25. On Monday, the stock closed above the key resistance at Rs 87 accompanied by strong volumes. Momentum indicators in the daily chart are positioned in the bullish zone. Both 10-day rates of change oscillator as well as the daily moving average convergence divergence oscillator are beginning to move above the zero line. The 14-day relative strength index has moved to 65, is also in the bullish zone.
The stock could move higher to Rs 90.6 and Rs 95.2 in the days ahead. Short-term investors can buy the stock with stop at Rs 85.
via BL
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