Morning Bells (23 Jan 13)

Good Morning Friends.

The person & well wishers in our life are like the stars that is constantly shining, but often we do not see them until the dark hours come.

So finally as expected Nifty corrected y’day, Nifty breached 6,100 levels after two years but failed to remain at around these levels.

So today there’s no major discussion as market not showing comfortable sign to move up and investors are cautious & are sideline ahead of major event of RBI policy.

Gainers – RIL, Wipro, NTPC, Bajaj Auto, Sun Pharma, ONGC, M&M were among gainers in Sensex and Nifty.

Losers - Infosys, HUL,  TCS, SBI, ICICI Bank, Coal India, Maruti Suzuki, L&T, Hero MotoCorp, Dr Reddys Lab, Bharti Airtel, BHEL, HDFC were the major losers in Sensex and Nifty.

Sectoral – All indices closed in RED. Realty, Consumer durables and PSU stocks were the major losers in Sensex and Nifty.

On Domestic Front -

To meet fiscal deficit finally the finance ministry on Monday announced a hike in import duty on gold and platinum to 6% from 4%. The move is aimed to discourage the consumption of these precious metals.

The finance ministry has also directed gold exchange-traded funds (ETFs) to park a part of their gold holdings with banks so that some demand for these metals is met from domestic sources. The ministry also eased the terms of gold deposit schemes of banks to encourage individuals to deposit their idle gold, which will help increase domestic supply. 

RBI Rate cut - Finance minister P Chidambaram has reportedly said that final decision on interest rates lies with RBI.

On Global front –

The finance minster has promised foreign institutional investors (FIIs) that he will stick to the 5.3% fiscal deficit target for the current year. He aims to reduce the deficit by 60 basis points in each year for the next four years till it reaches 3%. Also, he sees India getting to 8% GDP growth rate by FY14.

=====================  MARKET OUTLOOK  =====================

Right now market is undergoing a trend of consolidation and one need to take a cautious stance for fresh longs. Nifty is inching higher but most of indicators are showing overbought, so now it needs to consolidate or a correction before making fresh high.

After a blockbuster week, once again market is set to react on industry heavyweight this week, which care L&T (Thu 24 Jan), Marutu Suzuki and Cairn India.

The INDIA VIX on NSE was up 1.68% and ended at 13.89 against previous close of 13.66.

FNO PCR is 0.96 against previous close 1.01.

Indian Rupee weakened again against USD and was trading at 53.81/82 against its previous close 53.75/76.

S&P 500 (US) was trading higher at 1485.99 up 0.01 then its previous close at the time of writing M Bells.

Now next trigger is RBI policy on 29 Jan 12. Here please remember I am expecting maximum possibility for a 25bps cut in the repo rate in the upcoming monetary policy.

=======================  NIFTY OUTLOOK  ========================

Market consolidating, now its time to lighten your portfolio and don’t make any fresh longs. Keep 5935 as SL for Longs.

Buying in selective stock will continue.

Nifty is in range of 5935-5990-6040-6090-6150 for current week.

Resistance – 6086 – 6124 – 6147 and Support – 6025 – 6002 -5964

Opening seems flat and expecting range bound session. Or – profit booking will continue.

========================  STOCK OUTLOOK  ======================

(Stock outlook needs to watch stock movement carefully and then one can bet after having a look, I tried to put related info which will help you in taking positions.)

FDI in Retail –

Stocks of retail companies such as Pantaloon, Shopper's Stop and Trent were up after reports stated that Foreign Investment Promotion Board (FIPB) has cleared IKEA's Rs 100bn investment proposal.

Gold Retail –

Gems and jewellery firms such as Titan Industries, PC Jeweller, Gitanjali Gems and Shree Ganesh Jewellery House slipped 1-2%, after the government raised the import tax on gold by 2 percentage points to 6%.

Hero Moto Corp –

Shares of Hero MotoCorp were down after reports of ongoing labour issue at its Gurgaon plant.

Reliance Communication –

Reliance Communications shares rose 3% after reports stated that the company was in preliminary talks with Reliance Industries Ltd for a mobile network sharing deal.

==================== OPEN CALLS ====================

# Please remember when I make special remark with any position then one should need to take care of that else you can make loss instead of profit.

# Be with strict SL and don’t hesitate to book even small profit if Nifty doesn’t shows strength.

Wait is the winning key in stock market, don’t get impatience.

=============== INVESTMENT BASKET ===============

(Stock in this section is with view of 3 months to 1 year)

Mahindra Holiday – @334 TG 375+ (Active from 15 Dec 12) CMP – 330 (Gain -1%)

Satyam Computer – @103 TG 130+ (Active from 15 Dec 12) CMP – 115 (Gain +11%)

On Mobile – @44 TG 60+ SL 41 Qty 2K (Active from 01 Jan 13) CMP – 45 (Gain +2.5%)

=============== HOT SHOT ===============

Keep eye on following stocks, if Nifty shows strength then these stocks can give you reasonable return in very short term –

============ PL Sheet (started from Jan 2013) ============

(If someone find any error in PL, please draw our attention)

MG Blog (Total +25,650) –

Cash = +9,650.00

FNO = +11,500 + 4,500 = 16,000

Billionaire Club

TOTAL = +44,500

Today’s MG Mantra –

Don’t make fresh longs till RBI policy, one can trade with a view to exit before RBI policy.

Have a Profitable day – MG

Disclaimer –

1. I have shared my view as per my limited knowledge; please use your own skills to make a wise decision before execution of trade or consult your financial advisor.

2. Those that don’t have patience and are not willing to book loss also in cases don’t enter this market.