Market Close: to buy or not to buy !

US markets bounced back on last minute buying whereas Asia was volatile like a Seeesaw ride. Markets opened on a sombre note after the strong selloff seen yesterday. Buying interest in select heavyweights helped Sensex move into the positive territory in the early sessions and then there was some strength noticed on positive global cues. However the optimism soon gave way and markets softened yet again. Banks, consumer durables and realty stocks were able to hold on to some of their gains while capital goods, oil and metal stocks declined sharply and some of them even slipped into the red. Auto and IT stocks were very weak. Midcaps and smallcap segments too drifted to lower levels on profit taking but managed to gain some interest at the end. The sessions so far have been really volatile and that keeps investors away. Its seems that things will continue to be same for while. Extremely volatile and pressuring towards the negative.

Sensex ended up 50 points at 14985.7 helped up by gains in SBI (1592.75,+3 percent), TISCO (638.9,+3 percent), RCVL (542,+2 percent), BHEL (1698.7,+2 percent) and Grasim (2908.75,+2 percent). Restricting the gains were Hero Honda (649.5,-3 percent), Wipro (462.25,-3 percent), Tata Motors (652.2,-2 percent), TCS (1095.35,-2 percent) and Infosys (1899.6,-2 percent).

There was a downgrade of Everest Kanto by a leading Research house. Everest Kanto is the largest player in industrial cylinder in India. Govt. ruling on use of CNG as fuel in auto has boosted demand for CNG cylinders. The demand remains still high but now supply seems to be coming as more capacity is expected to come in Iran and that could change the scenario as Iran and Pakistan were expected to be the big markets. The stock had rallied in big way beyond fair value one coudl say. We believe more downsides is on cards.

ABG shipyard Ltd performed well and ended up by 2% after it has reported good results for Q1. It has received major order for construction of 12 vessels of approximately 32,000 dwt for Rs 1460 cr from Thailand's Precious Shipping Public Co. Ltd. The outstanding order book is now at Rs 5560 cr. Valuations appear to be rich. We are positive on business. However its the valuations are somewhat discomforting. Do read our detailed note on the site to get clearer picture on the stock.

We had a research note on Greenply as well. This company has been a winner for our research for quite some time. However the important thing is that we believe that the business is beginning to catch momentum and really its something to watch out for.

Technically Speaking: It was a fairly a volatile day for the market. Sensex made a high of 15135 and low of 14896 with the Advances out numbering decliners. The Advances stood at 1390 against the Declines of 1275. Volumes were low at Rs 4419 Cr. Sensex has moved into a short term downtrend with supports at 14800 and 14450. Having left unfilled gap on the higher side, there is chance of some bounce back up to 15200...15400 levels.