News Views & Events 9th April 2013

 

News:

Ø      The Supreme Court has allowed Bharti Airtel to continue offering 3G services in seven regions for the next few days, and in a separate case said it would decide next Monday whether the company's founder and chairman, Sunil Mittal, should be summoned as accused in the excess spectrum case.

Ø      Aditya Birla Nuvo has decided to sell its carbon black business to a group company, SKI Carbon Black (India), for Rs 1,451 Cr, as part of its plan to exit the business in the near future.

Ø      Barmer oil fields in Rajasthan may hold more reserves than initially assessed, feels the operator Cairn India. Also Cairn India is keen to start city gas distribution in Rajasthan as it sees huge natural gas potential in its block.

Ø      Reliance Industries (RIL) has stopped gas supplies to power plants after its KGD6 output hit an all-time low.

Ø      Coal India chairman defends company arm, says non-payment is putting a severe strain on ECL.

Ø      Engineering major ABB is preparing for the turnaround in the Indian market and will keep investing $100 million a year even though power equipment makers are facing difficult times.

Ø      Moser Baer defers bondholders' meeting for mulling FCCB recast.

Ø      Shriram Transport Finance to raise Rs 1000 Cr via NCD

Ø      Maharashtra Seamless  board approves buy-back at max Rs 300/sh (CMP 215) 

Ø      Panama Petrochem board OKs buyback at Rs.160/sh (CMP 135).

Ø      Union Bank labels Bilcare as willful defaulter, to send winding up notice to the company.

Ø      ONGC, Gail, RIL-BP, Petronet LNG and Torrent Power eyes 25% stake in GSPC LNG.

Ø      Today is the Ex date for Scheme of Arrangement. Demerger of Wipro Consumer Care & Lighting and Wipro Infrastructure Engineering & Medical Diagnostic Product & Services from Wipro into Wipro Enterprises. April 11 has been fixed as the record date for the demerger, which is effective March 31.

Key events for the day:

Ø      Mahindra Holidays IPP Opens and closes today. Price band Rs 255 - 265, to issue Rs 41.41 lakh shares

Ø      Release of Manufacturing Production & Industrial Production data in UK.

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Derivatives Strategist 9th April 2013

Data Feeler: Nifty future after three consecutive trading days fall, witnessed a consolidation move for the entire day with trading in a narrow range of around 30 points. Nifty future for the day, if sustains above 5580 levels then only some relief rally may be seen towards 5620-5650 levels. Whereas sustaining below 5550 levels may put further selling pressure in the market towards 5500 levels. Looking at the option concentration data for April series, maximum put OI is shifted at 5500 followed by 5600 strike price and maximum call OI is at 5700 followed by 5800 strike prices. Bank Nifty for the day has strong support around psychological 11000 levels whereas it has immediate hurdle around 11300 levels, if it breaches downside supp ort levels then one can hedge the long by buying 11000 put options.

 

Put Call Ratio based on Open Interest of Nifty moved down from 0.81 to 0.8 levels. Historical Volatility of Nifty moved down from 17.49 to 17 levels but Implied Volatility moved up from 15.38 to 16.37 levels.

 

Nifty future saw increase in OI by 3.76% with a fall in price by 0.23%. Market witnessed buying interest in CD, FMCG, HC, Power, Oil & Gas and Auto space whereas selling pressure was seen in IT, CG, Banking, Metal and Tech sector stocks. Nifty future closed at premium of 16 points as compared to premium of 19 points in previous trading session.

 

The market turnover decreased by 39.5% in terms of number of contracts traded vis-à-vis previous trading day whereas in terms of rupees decreased by 38.95%.

 

Derivative Calls: Buy on CIPLA & HPCL.

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First Morning Technical Call 9th April 2013

MARKET OUTLOOK

NIFTY (5545) : CNX Nifty traded in a narrow range and made an inside day trading within previous day's range so till 5590 on higher side or 5520 on lower side is not breached no major move expected till INFOSYS announces its result on 12^th March,2013.  Monday witnessed selling pressure in index heavyweights mainly Banking led by AXISBANK, PNB, BANKBARODA on the other hand stocks like ITC, TCS, INFY saw profit booking ahead of INFY Result. For the day, Nifty has to sustain 5530 on the down side and cross 5590 on the upside. Till the time Nifty doesn't make an attempt to cross 5590 on a closing basis, pessimism is here to stay. On the down side nifty has good support at 5500-5480 le vels, and till Nifty remains above these levels a possibility of a pullback cannot be ruled out. TVS MOTORS Rs.39 has rallied 23% this month with Bullish Run-away Gap(32.10-33.50) made on 3^rd April and follow Gap-up(36.8-37) this indicate stock is in bull grip soon we might see levels of Rs.46-50 any dip would qualify for buy. TVS Motor and BMW Motorrad (an integral part of the BMW Group) have signed a long-awaited cooperation agreement. Monsoon forecast official release is awaited post 10^th April and as per early indication India is likely to get normal monsoon rains this year Positive for FMCG, Fertilizer and Agriculture linked stocks RALLIS, GSFC, COROMANDEL, TATACHEM, BAYERCORP, HUL, EMAMI, TATACOFFEE, JAYSREE TEA are few stocks to watch.

SENSEX (18 441): Sensex closed below 200DMA for the third day in succession thereby closing lowest in as many as 95 trading days. Sensex for the day has to cross 18550 and sustain 18360 on the downside in order to make any possible attempts to move towards 18650 - 18720 in the days to come. Sensex failing to hold onto current levels and sliding below 18400 could spell real trouble for the index as it would open up 18100 -18020 levels. Sensex has given a clear breakdown from the 38.2% retracement and now looks weak to slide towards 18000.

 TECHNICAL CALLS 

BUY GODREJ INDS Rs. 295:  GODREJ INDUSTRIES is making a bullish inverted head and shoulder pattern on daily charts. The stock after making a recent high of Rs.309 has corrected to 290 odd levels and a strong pullback in the stock cannot be ruled out. The stock has witnessed decent volumes in the past few days and is also trading above its 200 DMA at 283.50.

BUY HINDUNILEVER Rs.477:  HUL has closed highest in 52trading days breaking Bullish Inv.Head & Shoulder  formation on closing basis where target on higher side could be 520 in next few weeks. HINDUSTAN UNILEVER'S 52 trading days high is Rs.481.8 crossing which the up-move would be very fast, stock is trading above 50DMA Rs.460 while below 200DMA Rs.499.

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