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

Synopsis:

Indian benchmark indices closed on a weak note with profit booking coming in banks and Oil and gas stocks. Defensives provided support to Nifty. Nifty opened higher and touched intraday high of 7922.70 in early hours and closed near day's low at 7875.30. Sensex closed at 26314.29. Fed minutes to be released in US raised concerns and profit booking kept the index under pressure at higher levels. Nifty strongly resisted 7900 mark.

Indian Markets

Indian benchmark indices closed on a weak note with profit booking coming in banks and Oil and gas stocks. Defensives provided support to Nifty. Nifty opened higher and touched intraday high of 7922.70 in early hours and closed near day's low at 7875.30. Sensex closed at 26314.29. Fed minutes to be released in US raised concerns and profit booking kept the index under pressure at higher levels. Nifty strongly resisted 7900 mark. Ahead of US Fed minutes Rupee opened flat today at 60.6750 and remained volatile for the day touching an intraday low of 60.88 and high of 60.5150.USD showed slight strength against major currencies with USD Index moving higher by 0.21%. Profit booking in equity markets also affected the inflows affecting Rupee. Bank of England minutes suggested split between members on rate hike decision, which created concerns of monetary tightening putting pressure on Rupee.

Other Asian Markets

Major Asian indices gave up losses after higher trade deficit in Japan and closed flat to positive ahead of US fed minutes. Nikkei closed flat at 0.03% while SSE composite closed lower by 0.23% recovering from day’s lows.

Commodity Outlook:

Commodity Market traded flat in the morning session. Gold and Silver Prices were range bound but showed very little upside potential due to fading geopolitical tensions and recovery of Equity Markets. Crude Oil prices were flat as investors were cautious ahead of US supply data. Natural Gas Prices also showed some weakness which could have been mainly due to Profit Banking. Base Metals made gains in the morning as strong US data lent them good support

Evening outlook:

Gold and Silver Prices are expected to continue their slide in the evening session; Crude Oil and Natural Gas are expected to remain flat while Base metals could continue their up move

Stock Recommendations:

Lupin – Buy at ` 1246.05(CMP); Target -` 1260.00; Stop Loss – ` 1235.00

United Spirits – Buy at `2455.55 (CMP); Target -` 2480.00; Stop Loss – ` 2435.00

ONGC – Sell at `424.00 (CMP); Target - ` 418.00; Stop Loss – `428.00

Sectors Snapshot

Bank Nifty: Bank Nifty witnessed a profit booking session today closing 43 points down. Federal bank and SBI along with other PSBs remained under pressure. Kotak Mahindra bank was the top gainer on Bank Nifty rising 1.97% on MCX approval of 15% share sale by Financial Technologies.

CNX Energy: CNX Energy closed lower as a result of profit booking in major Oil and gas stocks after the recent run up. ONGC lost 2.57% while IOCL, GAIL and BPCL also traded under pressure.

CNX Pharma: Amid uncertainty in market inflows were witnessed in defensives. Pharma stocks closed in green with the index closing up by 3.05%. Ranbaxy (up by 4.60%) and Sun Pharma (up by 4.59%) were top gainers in the index.

CNX Media: Media index closed up by 1.64%. Eros was the top gainer rallying 9.39% as ICRA assigned AA- (stable) rating to the company’s NCD plan.

India VIX: India VIX closed lower by 1.76% after opening higher.

Market Movers

Gainers

Sun Pharma: The market was seen weak in today’s session and hence defensives were see up where Sun Pharma the best performer amongst the Nifty constituents. Share prices were up by 37.2 points or 4.59% to close at 846.95. The arm of Sun Pharma Caraco Pharmaceutical has voluntarily recalled cephalexin capsules in US.

Losers

ONGC: Oil and Natural Gas companies were seen down after a rise in the previous couple of sessions on account of profit bookings, where ONGC was the worst performer amongst the Energy sector and Nifty constituents. The stock was down by 2.57% to close at 424.