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

Nifty ends below 8100 tracking global weakness, crude price

“Indian benchmark indices opened lower today taking cues from global sell off that fell tracking decline in crude oil prices. Nifty could not hold 8100 levels and closed at 8067.6. Indian trade deficit data also weighed on the indices which were released after market hours showed trade deficit widened to $16.86 billion. Weak Chinese PMI data put pressure on Asian indices as metals stocks were weak. Investors were seen cautious ahead of FOMC decision to be held today. Reports of the government tabling the goods and services tax bill in the current Parliament session limited the downside to some extent. Nifty was dragged by Financial and energy companies. Oil marketing companies rose while upstream petroleum companies declined” , Mr. Kiran Kumar Kavikondala said.

Indian Markets

Indian benchmark indices opened lower today taking cues from global sell off that fell tracking decline in crude oil prices. Nifty could not hold 8100 levels and closed at 8067.6. Indian trade deficit data also weighed on the indices which were released after market hours showed trade deficit widened to $16.86 billion. Weak Chinese PMI data put pressure on Asian indices as metals stocks were weak. Investors were seen cautious ahead of FOMC decision to be held today. Reports of the government tabling the goods and services tax bill in the current Parliament session limited the downside to some extent. Nifty was dragged by Financial and energy companies. Oil marketing companies rose while upstream petroleum companies declined. IT remained strong in today’s session.

Other Asian Markets

Asian indices were seen falling with crude oil continued to slip further while tracking weak global cues. Markets were seen choppy as investors were seen cautious ahead of US Fed meet to be held today. China’s PMI data slipped to 49.5 for the first time in seven months driving the sentiments negative. NIKKEI fell as Yen was seen getting stronger and major export companies took beating. SSE composite remained in positive due to carious decision taken by authorities. Tracking weak Asian markets KOSPI also closed in negative.

Commodity Outlook:

Commodity Market was very volatile in the morning session. Gold and Silver Prices dipped significantly in the morning session as fears on fears of rate hike by the Fed cautioned Investors. Crude Oil Prices continued to fall on supply concerns while Natural Gas traded flat in the morning session due to uncertain short term weather forecasts in USA. Base Metals traded weak in the morning session as Chinese Economic stimulus was offset by Fed minutes.

Evening outlook:

Gold and Silver Prices are expected to be range bound in the Evening session; Crude Oil and Natural Gas Prices are expected to be weak while Base Metals could trade mixed in the Evening session.

Stock Recommendations:

IOC – Buy at Rs.326.80(CMP); Target –Rs.331.00; Stop Loss – Rs.323.00

Axis Bank – Buy at Rs.472.00(CMP); Target - Rs.477.00; Stop Loss – Rs.467.00

Tata Motors - Buy at Rs.481.65(CMP); Target - Rs.487.00; Stop Loss – Rs.477.00

Sectors Snapshot

Bank Nifty – Banking Sector traded with positive bias in the session today despite the weakness shown by Nifty. Kotak Mahindra Bank was the biggest gainer in the sector on the news of Merger with ING Vysya Bank while PSU Banks also looked positive on speculations of disinvestment.

CNX IT: Index opened lower today due to weak global sentiments and surged over 1.5% as rupee was seen depreciating to 13 months low. Value buying was seen under this space which kept the major IT stocks up. As global weakness continues investors were seen shifting to defensive sectors. HCL was the top gainer among the index.

CNX Energy: Energy Sector lost more than 150 points in the session today as Crude Oil Prices hit new lows in the session today. ONGC and Cairn India continued to dip while BPCL was the only gainer in the sector which benefitted from the fall in Crude Prices.

CNX Pharma: Pharma index remained under pressure due major emerging currencies slipped today. Profit taking continued in today’s session. However fall in domestic currency kept the downside restricted. Dr. Reddy’s was the top loser falling more than 6% though company launched generic of anti-viral drug in US.

Market Movers

Gainers

HCL Tech: Shares were seen up after a sharp decline in yesterday’s session on account of value buying and also rupee was seen touching 13 months low.

TCS: Shares of the bounced back in today’s session after being the top loser in previous session as inflows were seen under defensive sector.

Losers

SSLT: Shares continue to slip due to weak Chinese PMI data and weak sentiments remain in global markets. Stock was seen down by 7.77%.

Dr. Reddy’s: Pharma space remained under pressure as major emerging currencies slip today. Profit taking continued in today’s session while Dr. Reddy’s was the top loser among the index

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