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WealthRays Securities

Source Name: WealthRays Securities

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

Sep 25, 2014   17:14 IST 
India

Synopsis:

Indian benchmark indices witnessed another sell off as weakness in metal, power and PUS banking stocks continued after the SC verdict on coal block de-allocation. Sept expiry happened at 7911.85 on Nifty. Domestic factors weighed on indices with RBI policy in focus on street. Nifty opened slightly in green tracking strength from US but global cues could not sustain and Nifty broke 7900 to touch intraday low at 7877.35. Banks dragged Nifty with Bank Nifty losing 441.25 points.  While CNX IT and media closed in positive. On Nifty, Jindal steel again witnessed fall of 7.7%, major banks fell and metal and power stocks fell while defensive and IT stocks showed strength.

 

 

Indian Markets:

Indian benchmark indices witnessed another sell off as weakness in metal, power and PUS banking stocks continued after the SC verdict on coal block de-allocation. Sept expiry happened at 7911.85 on Nifty. Domestic factors weighed on indices with RBI policy in focus on street. Nifty opened slightly in green tracking strength from US but global cues could not sustain and Nifty broke 7900 to touch intraday low at 7877.35. Banks dragged Nifty with Bank Nifty losing 441.25 points. While CNX IT and media closed in positive. On Nifty, Jindal steel again witnessed fall of 7.7%, major banks fell and metal and power stocks fell while defensive and IT stocks showed strength.

Rupee depreciated as Dollar rallied in previous session. Major Asian currencies were weak against USD. Oil importer demand weighed on currency while RBI policy also added to the worries. USDINR pair opened flat but continued to rise towards 61.17 levels. Weakness in equity markets and outflows of FIIs in previous session kept Indian currency under pressure. USD Index was up 0.32% suggesting strength in USD against major world currencies.

 

Other Asian Markets

Asian indices again closed mixed. Nikkei rose 1.28% on weak Yen and tracking strength from US markets. Hopes of Chinese stimulus provided strength to the markets with SSE closing 0.07% up. HSI closed in red at -0.64%.KOSPI erased gains and closed slightly down by 0.08%.

 

Commodity Outlook:

Commodity Market showed moderate volatility in the morning session. Gold and Silver Prices continued to look weak as strong dollar and Equity Markets kept its prices down. Crude Oil showed strength after bullish US supply data but global supply concerns limited its gains. Natural Gas made gains on warm weather forecasts in the short term. Base metals remained weak in the morning session due to mixed Equity Markets and excess global supply

 

Evening outlook:

Gold and Silver Prices are expected to remain weak; Crude Oil and Natural Gas are expected to make gains while Base metals are expected to remained weak.

 

Stock Recommendations:

ONGC– Buy at Rs 400.35(CMP); Target - Rs 404.50; Stop Loss – Rs 396.00

TATA Motors– Sell at Rs 504.35(CMP); Target - Rs 499.00; Stop Loss – Rs 509.00

L&T– Sell at Rs 1447.10(CMP); Target - Rs 1430.00; Stop Loss – Rs 1456.00

 

Sectors Snapshot:

Bank Nifty: Bank Nifty saw a sharp sell off as SC verdict on coal block hurt PSU banks having high exposure to the cos holding those blocks. Bank Nifty fell 441.25 points and closed down by 2.8%. PNB was top loser on the index. Cautious mood also kicked in ahead of RBI policy.

CNX Energy: Energy stocks fell as govt. delayed new gas pricing decision yesterday. Reliance and ONGC closed in deep red. OMCs also witnessed fall with each falling more than 2%.

CNX Pharma: Pharma stocks witnessed inflows and traded in green. Major pharma Cipla saw recovery and rallied more than 1.5%. Dr. Reddy was top gainer on the index. Piramal Enterprises was top loser on the index.

CNX Media: Media index witnessed recovery in last hour of the trade and came into positive. Most stocks were negative but the rise was supported by ZEE gaining 1.6%. Other major stocks remained mixed.

India VIX: India VIX rose 6.08% as fear in the market continued ahead of RBI policy.

 

Market Movers:

Gainers

Dr. Reddy's: While the markets were seen weak and Nifty was trading low, the money inflows were seen in defensive sectors like IT and pharma. Dr. Reddy's was the top performer among the Nifty constituents gaining 2.52% or 81.25 points to close at 3310.40.

Losers

JSPL: The company extended losses in today's session also after the Supreme Court verdict on coal block allocation. The shares were down by 7.70% to close at 174.90. It was the worst performer among the Nifty constituents. Company said that they will make sure its operations are not impacted.


 
 
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