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WealthRays Securities

Source Name: WealthRays Securities

Comments on the Market by Mr. Kiran Kumar Kavikondala, Director & CEO, WealthRays Securities

Sep 10, 2014   17:00 IST 
India

Synopsis:

Indian benchmark indices took negative cues from global markets and opened in red. Nifty opened 17.4 points lower and continued to trade negative. Nifty closed just below 8100 at 8094.10 and Sensex closed at 27057.21. Broad profit booking was seen on Nifty stocks. Energy stocks were down, Reliance, ONGC along with Jindal steel and Coal India dragged nifty. IT major Infosys also dragged Nifty while DLF, ICICI bank supported Nifty. European markets also traded in negative but recovered slightly in thin trade. Concerns over US Fed hiking interest rates earlier than expected added to the weakness in global markets. Crucial CPI and IIP data this week along with US fed decision will be in focus in coming sessions.

Indian Markets:

Indian benchmark indices took negative cues from global markets and opened in red. Nifty opened 17.4 points lower and continued to trade negative. Nifty closed just below 8100 at 8094.10 and Sensex closed at 27057.21. Broad profit booking was seen on Nifty stocks. Energy stocks were down, Reliance, ONGC along with Jindal steel and Coal India dragged nifty. IT major Infosys also dragged Nifty while DLF, ICICI bank supported Nifty. European markets also traded in negative but recovered slightly in thin trade. Concerns over US Fed hiking interest rates earlier than expected added to the weakness in global markets. Crucial CPI and IIP data this week along with US fed decision will be in focus in coming sessions. USDINR opened higher today tracking strength in USD. Fed concerns lifted USD keeping Rupee weak for the session. USINR touched intraday high at 61.06 breaching 61 levels briefly. Selling of Dollars by exporters supported Rupee, but weakness in Equity markets weighed on currency. USD was up against major Asian currencies.

Other Asian Markets:

Major Asian Indices were down as US Fed concerns overshadowed and triggered profit booking in equity markets. Nikkei closed in green up by 0.25% as Yen hit 6 year low. SSE composite closed 0.4% lower as credit supply concerns weighed on markets.

Commodity Outlook:

Commodity Market showed moderate volatility in the morning session. Gold and silver showed some strength in the morning session but Fed Rate hike fears kept their upper side limited. Crude oil Prices showed some signs of rally ahead of the supply data while Natural Gas Prices showed weakness may be due to profit taking by investors. Base Metals trade low in the morning session. Profit taking continued in Nickel while Copper prices showed strength due to drop in production in Chile.

Evening outlook:

Gold and Silver Prices are expected to be weak in the Evening session; Crude Oil could trade flat ahead of supply data while Natural Gas Prices could continue to be weak; Base Metals are expected to trade with limited upside in the evening session.

Stock Recommendations:

Reliance Capital– Buy at ` 551.60(CMP); Target -`564.00; Stop Loss –`541.00

IOCL–Sell at `390.85(CMP); Target -`385.00; Stop Loss – `394.00

Axis Bank– Sell at `416.50(CMP); Target -`411.00; Stop Loss – `420.00

Sectors Snapshot:

Bank Nifty: Bank Nifty opened lower but held on to 16100 mark to recover and closed 5 points down. Support was provided by ICICI bank while most banks traded in negative. Canara Bank was top gainer on the index. Bank of India was top loser closing down by 1.78%.

CNX Energy: Energy index opened flat but fell steadily as OMC stocks were down. Possible cut in diesel prices negatively affected OMC stocks. Fall in bent crude was another negative for ONGC and Reliance each falling more than a percent.

CNX Pharma: Pharma index also opened flat and rose but gave up gains in weak market. Most stocks on index traded in negative with exception of Cipla. Piramal lost 1.81%.

CNX Media: Media index bucked market trend, witnessed inflows and rose 2.23%. Zee gained 3.37% before its addition to Nifty next week.

India VIX: India VIX rose by 1.35% in weak market.

Market Movers:

Gainers

IDFC: The shares of the company were up by 2.08% to close at 144.90 on the news that the company plans to start its institutional share sale plan this week. It was the best performer among the Nifty stocks. The shares are expected to be of worth Rs. 10 billion.

Losers

Cairn India: Shares were down by 2.66% and fell by Rs. 9.10 to close at Rs. 332.75 as the company had announced its interim dividend and profit taking was seen in today's session after a good rise in past one month. It was the worst performer among the Nifty Constituents.

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