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

Indices ends above 8200 on short covering, oil slip halts

“Indian markets opened higher today with benchmark indices tracking gains from Wall Street after release of FOMC minutes yesterday. Banking stocks were seen moving higher and recovering from the previous fall ahead of crucial inflation and IIP data expected on Monday. Also, Q3 results for IT sector was eyed with Infosys set to start results season tomorrow. Globally markets were higher as oil recovered slightly and Indian Rupee gained against the greenback. US FOMC minutes suggested that Fed may be comfortable normalizing rates at current inflation levels but as the view suggested that economic growth will pick up helped major indices to rally. Inflows were seen in metal and auto stocks as well as RBI rate cut expectations remained. European markets also moved higher after disinflation yesterday and as market participants expected ECB to take a stand on possible QE in Euro zone. Nifty conquered 8200 on closing. ”, Mr. Kiran Kumar Kavikondala said.

Indian Markets

Indian markets opened higher today with benchmark indices tracking gains from Wall Street after release of FOMC minutes yesterday. Banking stocks were seen moving higher and recovering from the previous fall ahead of crucial inflation and IIP data expected on Monday. Also, Q3 results for IT sector was eyed with Infosys set to start results season tomorrow. Globally markets were higher as oil recovered slightly and Indian Rupee gained against the greenback. US FOMC minutes suggested that Fed may be comfortable normalizing rates at current inflation levels but as the view suggested that economic growth will pick up helped major indices to rally. Inflows were seen in metal and auto stocks as well as RBI rate cut expectations remained. European markets also moved higher after disinflation yesterday and as market participants expected ECB to take a stand on possible QE in Euro zone. Nifty conquered 8200 on closing.

Other Asian Markets

Major Asian indices were up today tracking positive momentum for Wall Street, FOMC minutes and expectations of QE by ECB. Shanghai was down as profit taking dragged the index, oil eased further lifting the indices. Major currencies were mixed against the greenback.

Commodity Outlook:

Commodity Market was very weak in the morning session; Gold and Silver Prices plunged in the morning session as the positive tone set by the Fed minutes favoured the Equity Markets thus taking the focus away from Bullion. Crude Oil Prices continued to slip in the morning session on supply glut while Natural Gas Prices remained weak despite cold weather outlook in USA. Base Metals were weak in the morning session mostly due to the weakness in Chinese equity markets.

Evening outlook:

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

Stock Recommendations:

TATA Power – Buy at Rs. 80.00(CMP); Target -Rs. 81.00; Stop Loss –Rs. 79.00

DLF - Buy at Rs. 142.75(CMP); Target -Rs. 144.50; Stop Loss –Rs. 141.00

Lupin - Buy at Rs. 1407.95(CMP); Target -Rs. 1433.00; Stop Loss –Rs. 1394.00

Sectors Snapshot

Bank Nifty: Bank Nifty recovered sharply today after global equity markets traded in positive and investors were seen entering PSBs ahead of month end RBI policy decision. The up move was also supported by global expectations of QE from ECB and strength in Rupee against the greenback.

CNX IT: IT index also led the gains on Nifty today with major stocks trading in positive territory. Strong close on global tech stocks and NASDAQ in previous session lifted the sentiment though major export oriented IT cos were slightly cautious on gains as markets awaited Infosys Q3 results tomorrow.

CNX Energy: Energy sector gained around 50 points in the session as positive sentiment prevailed as crude oil showed signs of rebounding from lows. All stocks in the sector closed in positive expect Reliance while Cairn India was the biggest gainer in the sector gaining over 5%.

CNX Pharma: Index opened higher and traded with positive sentiments tracking positive cues from global markets. Buying at lower levels in all the stocks of the sector was seen. However gains in rupee capped the upside. Glenmark Pharma was the top gainer amongst the index after the company won patent case vs. Abbott Biotech.

Market Movers

Gainers

Asian Paints: Shares of the company rose over 6% today as crude is seen under pressure. Input cost of the company is expected to fall down sharply.

DLF: Realty companies gained amid the rebound in the market on short covering, DLF was second gainer after Delta corp. in the sector.

Losers

Reliance Industries: Shares were seen down today after the company finalized its gasoil and jet fuel term contracts at lower premiums than last year.

Zee Entertainment: Selling continued as their promoters got 12.85 million shares released from the IDBI trusteeship & Axis Finance ltd.

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