Weekend Special (29-30 Sept 12)

So friends, Fresh Series has just taken place like Sehwag's opening. 

The main reason behind was apex bank's verdict on 2G spectrum - all natural resources did not have to be allocated through a public bidding process and that public good was more important than revenue maximization.

October is the month of corporate earnings too, so market will remain volatile and will react sharply on corporate earnings of Industry heavyweight.

Some experts are also expecting some more relief from RBI too.

Many other reform announcement and progress on reform announcement  will also decide market move.

So lets start having thought on in what way we are moving on.

Please also share any kind of news which you think could be part in deciding market movement.

Have a great weekend.

Morning Bells (28 Sept 12)

Good Morning Friends and welcome to Oct. series, month of corporate earnings,

A Bird asked a Bee, you work so hard to get honey and people steal it, don’t you feel sad? Bee replied politely – No! because they can never steal my art of making honey.

Finally Sept. series ended as per our expectation, even if some of you would have noticed, our poll results was also favoring that Nifty wont reach 5750 before expiry.

So once again, fresh start and again market is set to react sharply on announcement. October series is full of promises and various actions globally. This is also month of corporate earnings so market will remain full of thrill.

So Nifty stuck in a narrow range in continuation on 4^th day and finally Nifty closed below 5650. But once again market is ready to move up as Supreme Court has given relief to Govt. The Supreme Court on Monday clarified in response to a Presidential Reference by the government that all natural resources did not have to be allocated through a public bidding process and that public good was more important than revenue maximization. BJP has clarified that Govt. need not to consider it for Coal scam, the verdict was on 2G scam.

Well whatever the verdict it is, This comes as a big relief for the government, which had come under fire from the media and opposition parties for allocating coal blocks for free and now it’s going to relief few big stocks and they can surge today because the clarification essentially means that it is not compulsory for the government to allocate all natural resources through a public auction process. The government can choose which resources it wants to auction. Now you can think what can be done in future with natural resources.

On Global front problems persist with regard to the Euro Zone debt crisis amid fears that Spain is likely to be the next regional nation to seek a full bailout. Greece is struggling to convince international lenders about its seriousness in dealing with spiralling budget deficit.

Another major lookout is China; China too is under tremendous pressure. Chinese shares fell to their lowest level in more than 43 months on Wednesday amid worries about the health of the world's second largest economy. China’s economic growth is likely to slow for the ninth consecutive quarter in July-September, China’s economic data for August has turned out to be worse than expected and the economy’s prospects remain gloomy.

So next stimulus could be from China, Markets are now focusing on whether China will inject more stimulus by way of more infrastructure spending or a rate cut.

MARKET OUTLOOK –

As suggested 3 times before expiry, y’day Sept series expired in expected range of 5650-5700. So if this in line then probably we is going to remain in 200 pts range in Oct. First attempt could be 5720-5740 and if something comes boosting then we can head 5850 else market can take back from this range to test below 5600 mark even 5550-5500. So development in upcoming days will confirm the mood of market. But as far as I see it’s a around 200 pts series.

So lets start with fresh series and see what store in Oct. series.

NIFTY –

Resistance 5682 – 5714 - 5736 and Supports 5628 – 5606 - 5574. Close below 5574 will favour bears in near term. And any close above 5740 will extend current rally to 100 points.

Opening seems positive but don’t fall under temptation, now we need to watch and lets first market to decide its move.

STOCK OUTLOOK -

KFA – failed to assure its lenders with any 'concrete' solution for restructuring of debt in a meeting held on Thursday in Bangalore. The consortium of banks now decided to hold a meeting by the end of October. Company has total loans of around Rs 7,000 crore.

CoalGate – CBI today started probe against 24 companies and public officials in connection with alleged irregularities in coal block allocations between 1993 and 2004, including during the NDA regime. Now this game going to be interesting, so keep close eye on development, could be a good gain if you closely watch development in CBI probe.

Banks – Banks are on the move.

IT – Investors are entering to mid-cap IT industries on expectation that it will outperform in near future while large cap seen some pressure y’day while IT heavyweight seems under pressure.

PFC - Keep eye on PFC, its moves so fast and was under consolidation for 2 days. It can again move to 200 lvls.

OPEN CALLS –

So right I don’t have any open call today. New calls from today or from Monday.

Today’s MG Mantra –

Enjoy, Relax and plan your next move carefully. Small gains is the Mantra for first week of fresh series.

Have a Profitable day – MG

Disclaimer – I have shared my view as per my limited knowledge; please use your own skills before making a wise decision.

Morning Bells (27 Sept 12) - Sept Expiry

Good Morning Friends,

Opportunities are equal for all but the difference is – successful person gives results & unsuccessful person gives reasons.

So finally we have reached to expiry. It was third consecutive day when Nifty stuck in a narrow range. Y’day bulls tried to pull the Nifty but global market dampened the sentiment.

Well today there’s no thought (on domestic front) because its expiry day and it remains out of various logic.

Yes after expiry now market will look for weakness in global markets and concerns about the EU debt crisis. Ongoing debt crisis in Europe would keep some amount of uncertainty within the markets. Y’day Global market fell down to deep RED. European equity markets are nervous on the simultaneous occurrence of events, they also look for rally in currency too but currency is not participating compared to equity market and that’s a real worry for global investors. Investors should never trust a rally in the stock market unless it is accompanied by a rally in currency. So now we will also look for appreciation in Rs.

Another major lookout is China; Chinese shares fell to their lowest level in more than 43 months on Wednesday amid worries about the health of the world's second largest economy. China’s economic growth is likely to slow for the ninth consecutive quarter in July-September, China’s economic data for August has turned out to be worse than expected and the economy’s prospects remain gloomy, according to Chinese economic experts.

So next stimulus could be from China, Markets are now focusing on whether China will inject more stimulus by way of more infrastructure spending or a rate cut.

MARKET OUTLOOK –

Right now market is in No trade zone till it remain in the range 5650-5720.

We are in Sept series expiry, from last 3 sessions neither bull getting success to close above 5700 mark nor bears getting success to close below 5650 mark. This series is quite painful for bears as they tried 2 times to brace the bull run but failed.

Longs were rollover to next series and that’s its giving feeling for a dull expiry, however market will remain volatile say in 50 pts range, if bears get fail in the first half then bull will on run in second half. Most probably expiry seems around 5650-5700 but as told there’s no logic on the day of expiry like this one. If some of you would have remember my reply to Guru Prasad ji 2 days back, it was –

"We can have same session (todays) and can keep Nifty range bound i.e. around or below 57 mark, this way all nearby premium will be reduced aprx 40-50% and then last day it can make a move."

This thought has now come to reality.

NIFTY –

PCR come to 0.97 while India Vix fallen down to 16.97. 5800 CE has highest open interest of 86 while 5700CE has second highest OI of 63 Lacs with fresh addition of 14 lac shares. On other side 5600 PE has highest OI 86 lacs with fresh addition of aprx 8 lac shares. If you would have remember my view few days back, I had told you that bulls are cementing 5600 mark and that’s expiry was seem between/around 5650-5700. OI suggest once again it could be a narrow range (50 pts) expiry. Market will remain volatile ahead of expiry.

Resistance has come to Resistance 5678 – 5692 - 5712 and Supports has come 5639 - 5609. Close below 5585 will favour bears. And any close above 5740 will extend current rally to 100 points.

Opening seems mildly negative ahead of expiry pressure. First half seems range bound and under pressure, So it would be better for short position to windup before any wave fade out their gains.

STOCK OUTLOOK -

Banks – Banks are on the move.

IT – Investors are entering to mid-cap IT industries on expectation that it will outperform in near future while large cap seen some pressure y’day.

OPEN CALLS –

Cox&Kings – Y’day made high 146 and I had already suggested y’day to close the call.

So right I don’t have any open call today. New calls in fresh series from Monday.

Today’s MG Mantra –

Its expiry, if you have tight grip on stock movement then can test else stay away.

Have a Profitable day – MG

Disclaimer – I have shared my view as per my limited knowledge; please use your own skills before making a wise decision.

Morning Bells (26 Sept 12)

Good Morning Friends,

Fuel hike – 1 lt. Petrol & 1 Beer can – same rate – ab chahe Ghoom lo ya fir Jhoom lo J

Well, as told y’day that Govt. has just announced reforms & policy measures but now it needs to implement to sustain the market sentiment. Now many experts are also feeling this. Now most of them are saying – Govt. needs to implement reforms for the domestic sector for any substantial improvement in the economy.  

So in short now it needs to implementation to make the market move any further from here. So, I guess that right now the market is probably near the top of the range.

MARKET OUTLOOK –

We are just one day back from expiry, from last 2 sessions neither bull getting success to close above 5700 mark nor bears getting success to close below 5650 mark. So many experts are confused and opting wait and watch policy for a move either side.

Nifty showing weakness and FII too not participating much, so may be bears can try to take advantage, but most probably we can have range bound session at least first half too today.

NIFTY –

PCR come to 0.99 while India Vix fallen down to 17.11. 5800 CE has highest open interest of 89 lac shares with fresh addition of 13 lac shares. Huge unwinding seen in 5500 PE while 5600 PE has highest OI on put side.

So Resistance has come to Resistance 5700-5720- 5739 and Supports has come 5646 – 5626 – 5600 - 5585. So close below 5585 will favour bears. And any close above 5740 will extend current rally to 100 points.

Opening seems mildly negative ahead of expiry pressure. First half seems range bound and under pressure, any break out of Nifty level will put pressure for further downside. So would suggest to go for cautious approach and book at least part profit in your longs.

STOCK OUTLOOK -

Brent crude oil –

Had suggested to weakness in Oil sectors companies and specially suggested on blog board for Cairn, which fell down more than 3%, while Oil India remain stable. Hope you would have booked some profit.

Power Sector – Govt. has announced bailout package for power sector, plan seems flawless but now politician need to implement. Many experts says - "The package will become fruitful only if SEBs (state electricity boards) improve their financial performance, going forward, especially via tariff hikes and Transmission & Distribution loss reduction. In the short-term, the overhang on asset quality of banks due to SEB's large quantum may abate," Kajal Gandhi, Vasant Lohiya and Jaymin Trivedi, banking analysts from ICICI Securities, said in a research report. (report Money’Control.com)

FDI in Aviation –

KFA continued with gaining session. Y’day Directorate General of Civil Aviation (DGCA) has also given a clean chit to Kingfisher Airlines in its safety audit. According to the report, the aviation regulator has not found any safety lapse by KFA.

CoalGate –

Had suggested JSPL weakness after CBI probe to Naveen Jindal compaly. Had also posted message on blog board and hope you would have booked profit through short. Still there could be chance, please keep eye in morning trade.

Banks – RBI Governor D Subbarao y’da said inflation rate is still at unacceptable levels and efforts should be made to rein in prices further to provide relief, especially, to poor people. Statement could be a breaker to current run in banking stocks.

IT – IT sector can have good run up if recommendation recommended by a high-level panel appointed by PM and chaired by former CBDT chairman N Rangachary for liberal tax regime for the IT sector. However, it remains to be seen when it would be made public and when the finance ministry would actually accept these recommendations. (Source CNBC-TV18)

OPEN CALLS –

Cox&Kings – Please close call today at comfortable level.

Nifty 5700 PE - Had suggested for risk takers to buy around 28 (2 lot) for small gains but we hadn't closed that position y'day. TG - will announce SL - Risk takers (NS 5740)

Today’s MG Mantra –

Nothing wrong in book part profit ahead of uncertainty because in short now reform needs implementation to make the market move any further from here. So, I guess that right now the market is probably near the top of the range.

Have a Profitable day – MG

Disclaimer – I have shared my view as per my limited knowledge; please use your own skills before making a wise decision.

Morning Bells (25 Sept 12)

Good Morning Friends,

Never get discouraged, when your first few attempts fails, it’s often the last key in the bunch that opens the lock.

So much awaited profit booking taken place y’day, FMCG, Oil & Gas, PSU and Telecom stocks were among the top laggards but it was almost a dull session.

Market has also reacted on report of S&P Ratings, on Monday it has slashed India's GDP growth forecast to 5.5% from 6.5%, and CRISIL too had slashed its forecast for the country's GDP growth to 5.5% from 6.5% for the current fiscal year. HSBC has also cut its forecast for India's GDP growth in the current fiscal year.

S&P cut its outlook on India's sovereign rating of 'BBB-' to 'negative' from 'stable' in April this year. It had upgraded India to investment grade 'BBB' (Reports IndiaInfoline.com)

Well coming to home ground as informed on Friday that FM PC is set to announce few more policy measures, the day came y’day, TV reports flashed that Govt. has approved a bailout for cash-strapped power distributors, but details of the bailout package were not immediately available.

Power sector was dominated by years – on corruption, mismanagement have driven the power distributors. According to Govt. data power sector had accumulated Rs 92600 crore in losses by the end of the 2010/11 financial year. On the hope of bailout power sector stock gained y’day despite Nifty down.

Well why Govt. is announcing reforms & policy measures in hurry - It was quite necessary for Govt. to announce reform else possible downgrade in rating can increase borrowing cost and also repayment cost which could be another burden on Govt. and that’s UPA know it very well, no one would be able to handle the situation even if current govt. fall. Remember my line for next few year – we are gradually moving towards EU situation, not now but will take time if some export and production and macroeconomic condition is not get better in next few years. Middle class modern life style will be the main cause for that. Ofcourse corruption is no. 1.

Well come to current rally, the reforms announced so far are not enough, but it is a good start to at least gain some confidence in market. But to continue the momentum Govt. need to take some concrete steps on infrastructure and fiscal consolidation. Yes inflation and volatile political set-up are still two major concerns for India under current circumstances.

On Global front sentiment not seems good, Spain could go to the ECB for a bailout, Greece still tethering with the fact that it might exit and last but not least the worries of a slowdown in China.

MARKET OUTLOOK –

Well the current fact is that market forming base for bull cycle and if Nifty gets corrected here will be good sign to move above 6000 mark in next few months (except further political uncertainty). As suggested trend remain buy on dips till 5459 is not broken on closing basis, it will be a trend changer signal.

Regarding expiry I feel that the expiry could be between levels of 5,650 - 5700 - 5,730

NIFTY –

As told y’day Nifty has reached in overbought zone, and that’s had suggesting slightly cautious approach till expiry. Bulls have started rollover their longs for Oct. series. 15 Lacs share were added to 5800 CE and now 5800CE has highest OI, approx 4 Lac share were added to 6000CE which indicating tough time ahead for bears.

PCR 1.23 and India Vix 18.83. Resistance has come to Resistance 5700-5748- 5806 and Supports has come 5604 – 5517 - 5459. So close below 5459 will favour bears.

Trend remain buy on dips till 5459 is not broken on closing basis, it will be a trend changer signal.

Opening seems sedate with mildly negative outlook as most of global markets were down y’day, market may again remain under pressure and bull will give a try to close it around or above 5700 but still would suggest to go for cautious approach.

STOCK OUTLOOK -

FNO exclude –

From this week, 51 stocks will be excluded from the NSE derivatives segment, some of them - Aban Offshore, Bajaj Hindusthan, BF Utilities, BGR Energy, Core Education, Development Credit Bank, Educomp Solutions, Essar Oil, Hindustan Construction Co, Hindustan Oil Exploration, India Infoline, Indian Oil, Jet Airways, Lanco Infratech, MRPL, MTNL, OnMobile Global, Orchid Chemicals, Polaris Financial, Praj Industries, Rolta India, S. Kumars Nationwide, Shobha Developers, Tata Coffee, TTK Prestige, Videocon and VIP industries.

Brent crude oil –

Fell below USD 110 a barrel on Monday, dragged down by a firm dollar and worries over weak global economic growth after disappointing German data. Brent dropped 4.5 percent last week, while US crude lost 6.2 percent on demand worries and a pledge by Saudi Arabia to supply enough oil to the market to keep prices down.

Power Sector - Shares of Power Finance Corp. and Rural Electrification Corp. surged on Monday amid media reports to consider a bailout plan for the debt-laden power distribution companies.

FDI in Aviation –

Companies looking for FDI need to get clearance from the ministry and FIPB for it. Keep eye on KFA, Jet & Spice.

FDI in Retail -

Stocks will pickup with Nifty upmove.

Infra - Finance Minister P Chidambaram has proposed single window clearance under Prime Minister Manmohan Singh for infrastructure projects. Infra sector will remain in news for next few days.

CoalGate –

Various companies will be on investor’s fire, TV reports said y’day that now CBI to investigate Coal Allotment from 1996. Media reports also reported CBI probe for Jindal Steel & Power. Also keep eye on Coal India.

Banks – I see banks will perform good in near future ahead of CRR cut, drop in interest rate and festive season. One can keep eyes on SBI, Axis Bank & HDFC Bank look attractive, but one need to wait for Nifty settlement.

DiD – Stock will remain in news & on buyers RADAR - Hindustan Copper, Oil India, Nalco, Neyveli Lignite, MMTC and Rail India Technical and Economical Services (RITES) due to IPO planning.

Suzlon Energy - Company is into severe cash crunch, interest cost this company has not good, it paid around Rs 5 crore in the first quarter, operations have been pretty bad and there are no hopes of the operations being revived in the near future. - Rajesh Agarwal, Eastern Financiers, told CNBC TV18

OPEN CALLS –

Cox&Kings – Bought 138, TG 148, SL 121 (R 133 – 139 S 129 - 127)

Today’s MG Mantra –

So, as long as liquidity continues to pour in, fundamentals will have to take a backseat. So enjoy the ride with proper safety belts is the MG Mantra for next few sessions. So, don’t try to go short in excitement, first try to watch stock movement.

Have a Profitable day – MG

Disclaimer – I have shared my view as per my limited knowledge; please use your own skills before making a wise decision.