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Thursday, November 09, 2006
Sharekhan Commodities Buzz
Of the three options we discussed yesterday, the first option played out last night when the democrats got a clear mandate in the US mid-term elections, thereby taking both gold and silver down. Expect bullions to trade lower for a few more days and medium term investors should accumulate the precious metals at current levels.
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Breaking Premium News - Moser Baer - Margins Improve
Digital disc maker Moser Baer India Ltd.
Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) stood at 26.5 percent in the July-September quarter, showing a rise of 7 percentage points from the preceding quarter, Executive Director Ratul Puri told Reuters on Thursday.
"We will continue to see firm pricing environment, continue to see stable or weak polycarbornate (raw material) prices and see improvement in overall efficiency," Puri said.
Breaking Premium News - Petron Engineering Construction Ltd.
Petron Engineering Construction Ltd.
The contract involved civil and mechanical work for refractories at Grasim's cement project in the north-western state of Rajasthan, Petron said in a statement
Breaking Premium News - TCS, Satyam Deal
India's top software exporter, Tata Consultancy Services Ltd.
The contracts to outsource IT support services, which were announced last month, are both for seven years.
TCS said its part of the order was worth A$120 million, or US$90 million, while Satyam said its portion of the contract was worth A$71 million (US$55 million).
TCS and Satyam said they would provide a range of IT application development, transformation and maintenance services to Australia's top airline.
Indian software services firms have been thriving on an outsourcing boom as companies worldwide look to cut costs at home to stay competitive.
A large English-speaking engineering workforce and wages at nearly one-fifth of western salaries have helped Indian companies attract outsourcing deals over the past decade.
At 0610 GMT shares in Satyam, whose customers include General Electric
Breaking Premium News - Renault, Mahindra to form new production tie-source
French car maker Renault SA
Renault's Japanese alliance partner Nissan Motor Co. <7201.T> may join the project, the source said.
Nissan previously had been discussing a joint manufacturing project in India with Japanese compact car maker Suzuki Motor Corp.
Premium NEWS - Hindustan Zinc increases prices
India's top zinc producer Hindustan Zinc Ltd.
The company also raised lead prices by 4.1 percent to 88,800 rupees a tonne.
Tech View - Pullback Expected
Sensex closed in Negative Territory on the 2nd consecutive day, down by 84 points with volume of Rs4037Cr.
Choppy session continued for the 3rd consecutive day as Sensex opened with upside gap and slipped towards important support level and bounced back almost 100 points. But this pullback rally failed to sustain the important 13260 levels which lead sensex down by 250 points from the days top.
As per our previous notes what we were looking for is C wave of correction which targeted 12920 level. As of now Sensex has corrected upto 12951 level, very close to the target. If it is part of the flat pattern then it must hold above 12920 level otherwise it could be a part of a triangle and 12860 or more lower level could be expected as a leg of the triangle.
Sensex has formed a Bearish candle with lower shadow pattern which indicates a weakness in the trend which will remain the same. To Nullify the bearishness,
Sensex must hold above 13130 level which is more than 50 % of previous candle. If it does then 13700 level could be possible otherwise 12860 or more lower level can be seen.
Daily Strategy: - If Index opens downside and hold above 13000 level then buy for the target of 13180 levels with a stoploss of 12980 levels for the first half.
( A pullback rally is expected )
Support 1) 13030 2) 12990 3) 12950 4) 12920
Resistance 1) 13180 2) 13260 3) 13340
Market may witness pull-back
Overnight gains in the US markets and rise in several Asian indices in the ongoing trading session may help the domestic indices rebound from lower levels. However, lack of clarity in the market and higher volatility may make the market edgy. Among the indices, the Nifty in the short term could test 3840 on the upside and has a support in the 3737-3720 range. The Sensex has a likely support at 12950 and may face resistance at 13158.
In the US markets, the broader Dow Jones scaled up by 20 points at 12177 following the resignation of U.S. Secretary of Defense Donald Rumsfeld, as the Democrats regained control of the U.S. House, fueling hopes for a change in Iraq policy & less government spending, while the tech-heavy Nasdaq added nine points to close at 2385.
Indian ADRs were mostly up on the US bourses. VSNL led the gainers pack and surged above 2%. ICICI Bank, Satyam, Wipro and Patni Computers jumped over 1% each while HDFC Bank registered steady gains. However, Dr Reddy's, Tata Motors lost ground and were down by 1% each while MTNL eased marginally.
Crude oil prices moved slightly up, with the Nymex Light Crude oil for December delivery adding $0.90 to close at $59.83 a barrel, while the London Brent crude falling by $1.27 to close at $58.48 per barrel. In the Commodity space, the Comex gold for December series declined $9.40 to settle at $618.30 an ounce.
On Nov 7 2006, FIIs were net buyers of stocks to the tune of Rs335.50 crore (purchases worth Rs2,099.70 crore and sales of Rs1,764.20 crore) while domestic mutual funds were net sellers of stocks to the tune of Rs14.98 crore (purchases worth Rs521.41 crore and sales of Rs536.39 crore).
Investment Strategy
One of our readers, Rajit writes ...
Ive just started working and was browsing through some blogs, looking for somethnig related to investments n other stuff.... I found your blog to be very informative and this happens to be a very smart way of investing!....i m really overwhelmed by the way you showcased how we can make money keeping our initial investment intact... Would definitely read the rest...thanks a lot for this...and btw will u suggest a proper investment policy for someone like me who has started working only about 2 months ago....i can invest upto 6K every month....but intend to take a break from work for about 2 years to finish my masters... Trying to help dad in financing his dream home is another objective...which would call for a loan of about 5-8 Lacs and is hence a purely ambitious one considering the present scenario.... Hope you'd have u have the time to help me out with this...but irrespective of whether you help out with this or not, i found your blog very interesting and thanks again for this wonderful idea! Keep it up.
Rajit - you could probably start off by investing through SIPs in mutual funds. Invest about Rs.1000 in each of the funds
My recommendations for investment would be tax saving funds - which accomplishes 2 things
1. Tax saving under 80ccc
2. These fund have a lock-in period for 3 years which gives enough time appreciation
You could consider the following funds
1. HDFC Taxsaver
2. Magnum Taxgain
3. HDFC Longterm Advantage
If you are looking for equity funds (non taxsaving)
1. Reliance Vision
2. Reliance Growth
3. HDFC Equity
4. Magnum Contra
You could probably go through some of the investment queries & answers at
http://valueresearchonline.com/story/askvroarchive.asp
I would like to congratulate you on thinking about investments so early in your career - the best strategy is to start early. Wish I were like you then :)
I am not the right person to advise you on the loan query.
Maybe our visitors can help you out.
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