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Wednesday, May 16, 2007
Poweryourtrade.com Trading Calls
Ashwani Gujral
Buy Pantaloon Retail with stop loss of Rs 400 for a target of Rs 530
Buy Moser Baer with stop loss of Rs 360 for a target of Rs 510
Rajat K Bose
Buy Moser Baer with stop loss below Rs 394 for a target of Rs 424. This is a day-trading recommendation.
Sell Tata Tele(M) with stop loss above Rs 29.75 for a target of Rs 27.80, 26.90 and 26.55. This is a day-trading recommendation.
Deepak Mohoni
Buy Moser Baer below Rs 308 with stop loss at Rs 300. This is a day-trading recommendation.
Short sell Suzlon Energy above Rs 1140 with stop loss at Rs 1160. This is a day-trading recommendation.
STRATEGY INPUTS FOR THE DAY
Dull times, concentrate
Life is dull only to dull people
Dare we say it may well just be another dull day on the bourses. With nothing to play on at the moment, the market will remain directionless and will witness more intra-day swings. Unless you are trading on the Nifty leave the broad direction aside and concentrate on counters you wish to buy . We expect the sideways movement to continue for a while before any fresh triggers emerge. There will be more churning of portfolios as investors look for more gains. The action will continue to be stock specific and news based.
Global factors will remain one of the key drivers of the sentiment. Investors should do well to avoid fresh buying at this juncture as the bulls clearly lack conviction . Still, if the market has to make a decisive movement in any direction, it may well be down first and then an up move. We expect the market to open on a cautious note today amid lack of clear indications from the global markets. The key stock benchmarks may just end on a flattish note yet again.
FIIs were net sellers of Rs2.84bn (provisional) in the cash segment yesterday. Local institutions too offloaded shares worth Rs599mn. In the F&O segment, they were net sellers of Rs1.13bn.
United Spirits will be in focus amid reports that Vijay Mallya is likely to announce the acquisition of Whyte & Mackay today. Wockhardt could be under pressure after Abbott Laboratories sued the Indian drug major to block regulatory approval of a generic version of the company's epilepsy treatment Depakote ER.
SBI and its three listed subsidiaries will hog the limelight after the Lok Sabha cleared a bill that will lend greater autonomy to SBI's seven subsidiaries. IT companies, already reeling under the steep appreciation in the rupee, may be hit further amid reports that two US senators have sent notices to lal big software firms on the alleged violation of the H-1B visa norms.
On Wall Street, the Dow Jones Industrial Average rose 37 points to 13,383.84, ending at a new record. The blue-chip barometer briefly hit an intraday mark of 13, 481.60 before retracing a bit.
The broader S&P 500 index finished almost flat at 1,501.19, after hitting a fresh six-year high during the session that set it within 15 points of its all-time high from March 2000.
The tech-fueled Nasdaq Composite was down 21 points at 2,525.29, limited by weakness in Amgen and a number of chip and Internet stocks.
Stocks were up through the early afternoon session as investors focused on a mild reading on inflation. However, the rally lost steam in the afternoon owing to a report showing further weakness in home building ahead of Wednesday's housing market report.
The Consumer Price Index (CPI) rose 0.4% in April, short of expectations. The so-called Core CPI, which excludes the volatile food and energy prices, rose 0.2%, as expected.
US light crude oil for June delivery rose 71 cents to settle at $63.17 a barrel on the New York Mercantile Exchange. The front-month contract was quoting 6 cents lower at $63.11 a barrel in extended trading in Asia.
COMEX gold for June delivery rose $4.40 to settle at $674.50 an ounce. Treasury prices slipped, pushing the yield on the 10-year note to 4.7%, up from 4.69% late on Monday. In currency trading, the dollar slipped against the euro and was little changed against the yen.
European shares closed higher. The pan-European Dow Jones Stoxx 600 index rose 0.1% to 389.17. The UK's FTSE 100 closed up 0.2% at 6,568.60, the German DAX Xetra 30 advanced 0.6% to 7,505.35 and the French CAC-40 added 0.4% to 6,049.76.
In the emerging markets, the Ibovespa in Brazil ended flat at 50,518 while the IPC index in Mexico lost 0.5% at 29,619 and the RTS index in Russia slumped 1.3% to 1826.
In Asia this morning, the Nikkei was down 40 points at 17,472 while the Hang Seng in Hong Kong advanced 45 points to 20,913. The Kospi in Seoul added 3 points at 1592 and the Straits Times in Singapore was flat at 3473.
A sluggish session ended almost on a flat note as lack of support from the Asian markets and selling pressure dragged the key indices to close in negative terrain. Techies continued to be on the receiving end and Sugar stocks also were battered. However Banking and Select FMCG stocks aided support to the markets. Media stocks were the star performers. Suzlon lost over 9% on back of lower than expected Q4 result. Finally, the 30-share benchmark Sensex dropped 36 points to close at 13929. NSE Nifty was down 14 points to close at 4120.
SBI gained by 1.8% to Rs1227 after Finance Minister announced that the Government would take control of the Bank by August. The scrip touched intra-day high of Rs1241 and a low of Rs1200 and recorded volumes of over 22,00,000 shares on NSE.
Suzlon Energy plunged by over 9% to Rs1137 after the company announced its Q4 result which were lower than market expectation�s. The company�s Q4 net profit was at Rs4.37bn (up 21%) and sales at Rs20.97% (up 33%). The scrip touched intra-day high of Rs1254 and a low of Rs1125 and recorded volumes of over 18,00,000 shares on NSE.
Havells India surged nearly by 5% to Rs498 after the company announced that they would pay dividend of Rs2.5 per share. The scrip touched intra-day high of Rs505 and a low of Rs477 and recorded volumes of over 3,00,000 shares on NSE.
Infotech Enterprises dropped 2.7% to Rs350. The company announced its strategic move to address Geospatial business opportunities in India and the Middle East by taking majority stake in Hyderabad-based Geospatial Integrated Solution Pvt Ltd. The scrip touched intra-day high of Rs362 and a low of Rs343 and recorded volumes of over 52,000 shares on NSE.
HDFC edged lower by 0.3% to Rs1671. The Company announced that it would buyout Chubb global stake in General Insurance venture. The scrip touched intra-day high of Rs1708 and a low of Rs1652 and recorded volumes of over 3,00,000 shares on NSE.
Banking stocks recorded smart gains led by gains in the index heavy weight ICICI Bank, the scrip was up by 2% to Rs887, SBI gained 1.8% to Rs1228, HDFC Bank advanced 1.4% to Rs1010 and Corp Bank added 1.3% to Rs318.
The media stocks put on a good show. Scrip�s like Raj TV was locked at 20% upper circuit to Rs226.40, WWIL spurred by over 5.5% to Rs73, Broadcast initiatives rose over 6% to Rs77 and Adlabs added 5.8% to Rs504.
Sugar stocks witnessed some profit booking after rallying for last couple of trading session. Renuka Sugar declined over 6% to Rs535, Sakhti Sugar was down 4.3% to Rs93, Balrampur Chini dropped by over 5.5% to Rs70 and Bajaj Hindusthan lost 5.8% to Rs167.
Insider Trades:
3i Infotech Limited: Shivanand R. Shettigar, General Manager & Company Secretary has sold in open market 2000 equity shares of 3i Infotech Limited on 10th May, 2007
Dena Bank: UBS Securities Asia Limited A/c. Swiss Finance Corporation (Mauritius) Ltd. has purchased from open market 2000000 equity shares of Dena Bank on 10th and 14th May, 2007
BSE Oil & Gas index was the major loser and lost 0.87%. BSE Technology index (down 0.69%), BSE Capital Good index (down 0.49%), BSE Auto index (down 0.48%) and Consumer Durable index (down 0.28%) were among the other major losers. However, BSE Bank index gained 1.65%.
Volume Toppers:
RNRL, IFCI, Petronet LNG, Idea, SAIL, FSL, WWIL, IB Real Estate, R Com, Indian Hotels, Bank of India, Cinemax, DCB, Arvind Mills, Broadcast Initiatives, Dena Bank and Dish TV
Upper Circuit:
Pratibha Industries, Ambalal Sarabai, UFlex, Shringar Cinemas, AMD Metplast, Bartronics, Thomas Cook, Tera Software, Mefcom Agro, Sujana Metal, Fortis, Flawless Diamond, Vyapar Industries, Raj Tele and Mercator Lines.
3i Infotech Limited: Shivanand R. Shettigar, General Manager & Company Secretary has sold in open market 2000 equity shares of 3i Infotech Limited on 10th May, 2007
Dena Bank: UBS Securities Asia Limited A/c. Swiss Finance Corporation (Mauritius) Ltd. has purchased from open market 2000000 equity shares of Dena Bank on 10th and 14th May, 2007
BSE Oil & Gas index was the major loser and lost 0.87%. BSE Technology index (down 0.69%), BSE Capital Good index (down 0.49%), BSE Auto index (down 0.48%) and Consumer Durable index (down 0.28%) were among the other major losers. However, BSE Bank index gained 1.65%.
Volume Toppers:
RNRL, IFCI, Petronet LNG, Idea, SAIL, FSL, WWIL, IB Real Estate, R Com, Indian Hotels, Bank of India, Cinemax, DCB, Arvind Mills, Broadcast Initiatives, Dena Bank and Dish TV
Upper Circuit:
Pratibha Industries, Ambalal Sarabai, UFlex, Shringar Cinemas, AMD Metplast, Bartronics, Thomas Cook, Tera Software, Mefcom Agro, Sujana Metal, Fortis, Flawless Diamond, Vyapar Industries, Raj Tele and Mercator Lines.
Delivery Delight:
Bharat Forge, BHEL, BPCL, Century Textiles, Gujarat Alkalies, Gujarat State Fertilizers, ICICI Bank and Indian Hotels.
Bharat Forge, BHEL, BPCL, Century Textiles, Gujarat Alkalies, Gujarat State Fertilizers, ICICI Bank and Indian Hotels.
Abnormal Delivery:
LIC Housing Finance Ltd, Federal Bank, ONGC, Electrosteel Castings, Thermax, Bajaj Auto, Tata Chemicals and Tata Power.
LIC Housing Finance Ltd, Federal Bank, ONGC, Electrosteel Castings, Thermax, Bajaj Auto, Tata Chemicals and Tata Power.
Stock Futures with largest increases in OI:
Financial Technologies, Moser Baer, Pantaloon, Petronet LNG, Kesoram Industries, Educomp and Adlabs Film.
Financial Technologies, Moser Baer, Pantaloon, Petronet LNG, Kesoram Industries, Educomp and Adlabs Film.
Stock Futures with largest decreases in OI:
Nagarjuna Fertilizer, LIC Housing, Renuka Sugar, Voltas, BEML, Arvind Mills, HLL and Cipla.
Nagarjuna Fertilizer, LIC Housing, Renuka Sugar, Voltas, BEML, Arvind Mills, HLL and Cipla.
Results Today:
Balaji Telefilms, Bongaigaon Refinery, Indo Rama Synthetics, JK Lakshmi Cement, D-Link, ICI India, JB Chemicals, Bharat Gears, Shanthi Gears and Entertainment Network India.
Balaji Telefilms, Bongaigaon Refinery, Indo Rama Synthetics, JK Lakshmi Cement, D-Link, ICI India, JB Chemicals, Bharat Gears, Shanthi Gears and Entertainment Network India.
Results Corner:
Suzlon Energy net profit at Rs4.37bn (up 21%), sales at Rs20.97% (up 33%)
Suzlon Energy net profit at Rs4.37bn (up 21%), sales at Rs20.97% (up 33%)
Brokers Recommendations:
BHEL - Buy from CLSA with target of Rs2950
BHEL - Buy from CLSA with target of Rs2950
Avaya Global - Buy from Emkay with target of Rs358
Reliance Capital - Buy from Merrill Lynch with target of Rs1025
Long Term investment:
HCL Tech
HCL Tech
Major News Headlines:
Govt will take control of SBI by August: FM
Lok Sabha approves amendments in SBI Subsidiary Bank Laws Amendment Bill to
Seven SBI subsidiaries can raise fresh capital
RIL makes 2 new gas discoveries
Infotech Enterprises to buy stake in Geospatial Integrated
Suzlon to spend Rs8.5bn on Hansen unit expansion
Arvind Mills in JV with Diesel Planet
Hindalco completes acquisition of Novelis
Essar Global to consider building $3.4bn oil refinery in Egypt
KS Oil to consider stock split on May 23.
Market may remain range bound
The market may move in a narrow range today tracking similar trend in Asian markets. The market had settled on a subdued note on Tuesday 15 May 2007 tracking negative cues from global markets. Sensex had lost 36.53 points or 0.26% to settle at 13,929.33.
A strong rebound on the domestic bourses had materialized, last month as the initial Q4 March 2007 results were strong and Infosys issued a strong guidance for FY 2008 on 13 April 2007. From 12,455.37 on 2 April 2007, the Sensex had surged 1,773.51 points (14.2%) to 14,228.88 on 26 April 2007. It has since then turned volatile.
Asian markets were mostly in the green on Wednesday, 16 May 2007, but their gains were muted as investors digested a mixed bag of US data. Key benchmark indices in Hong Kong, China, Singapore, South Korea and Taiwan were up by between 0.03% to 0.8%.
The Dow industrials rose to a record high close on Tuesday, 15 May 2007, as signs of stabilizing inflation raised the prospect of lower interest rates, boosting the outlook for business investment. But the Dow ended well off its highs of the day and the S&P 500 index and the Nasdaq declined as disappointing results from some retailers and a report showing US home builder confidence fell in May raised concerns about consumer spending. The Dow rose 37.06 points, or 0.28 percent, to end at 13,383.84, a record close. The Dow also hit a record intraday high of 13,481.60.
The Standard & Poor's 500 Index was down 1.96 points, or 0.13 percent, at 1,501.19. The Nasdaq Composite Index was down 21.15 points, or 0.83 percent, at 2,525.29.
Over the next few months, the progress of the June-September monsoon will hold the key to the direction of the domestic bourses. The Indian meteorological department on Monday, 14 May 2007, forecast annual monsoon rains would arrive in Kerala on 24 May 2007. The weather office said last month that this year's monsoon rains were likely to be 95% of the long-term average, with a five per cent margin of error. The annual monsoon is vital for India's economic health as it provides the main source of water for agriculture, which generates more than a fifth of gross domestic product (GDP).
Some important March 2007 quarter results are scheduled this week and the market will take its cue from these results. Bajaj Auto and Tata Steel report Q4 results on Thursday, 17 May 2007. The board of Bajaj Auto will also consider proposal to split the company into two. Tata Motors and Dr Reddy's Laboratories unveil Q4 results on Friday, 18 May 2007.
FIIs resumed buying of equities on Monday 14 May 2007 but the quantum of their inflow was small. FIIs were net buyers to the tune of Rs 60.50 crore on 14 May compared to an outflow of Rs 336.20 crore on Friday 11 May 2007. FIIs have been net buyers since last month, but there have been bouts of outflows from them since the past few days. Their outflow for May 2007, till 15 May 2007, totaled Rs 222.70 crore. FIIs had made heavy purchases in April 2007, aiding the market stage a solid rebound from lower level. Their inflow in April 2007 totaled Rs 6679.20 crore.
As per provisional data, FIIs were net sellers to the tune of Rs 284 crore on Tuesday, 15 May 2007, the day when Sensex had lost 36.53 points. Domestic institutions were net sellers to the tune of Rs 60 crore on that day.
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