Morning Bells (13 Mar 13)

Good Morning Friends.

In this world nothing is impossible, if you see the word “Impossible” carefully, it itself says I M Possible. So its depend how you see the word (i.e. world).

After taking a pause in the previous trading session, markets further weakened and lost grip on Tuesday as the benchmark indices witnessed selling. Market participants reacted sharply to rising Consumer Price data and entirely ignored better than estimated IIP figures.

The annual inflation CPI (Combined) for February 2013 on point to point basis (February 2013 over February 2012) is 10.91%. The corresponding inflation rates (provisional) for rural and urban areas are 11.01 % and 10.84% respectively. The Industrial Production data for the month of January 2013 stood at 181.8, which is 2.4% higher as compared to the level in the month of January 2012.

This affected major event of RBI policy on 19^th March. While IIP data surprised positively with 2.4% growth in January, the CPI print of 10.91% for February disappointed. Both the datapoints dilute the market hope of a 50bps rate cut by RBI in the monetary policy early next week.

The Index of Industrial Production (IIP) for the month of January 2013 stands at 181.8, which is 2.4% higher as compared to the level in the month of January 2012. The cumulative growth for the period April-January 2012-13 over the corresponding period of the previous year stands at 1.0%.

The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of January 2013 stand at 134.0, 193.7 and 160.7 respectively, with the corresponding growth rates of (-) 2.9%, 2.7% and 6.4% as compared to January 2013 (Statement I). The cumulative growth in the three sectors during April-January 2012-13 over the corresponding period of 2011-12 has been (-) 1.9%, 0.9% and 4.7% respectively.

Gainers – RIL, Maruti Suzuki, Mahindra & Mahindra, Tata Motors, Jindal Steel, SBI, Gail India, ONGC, Dr Reddy’s Lab, ITC were among gainers in Sensex and Nifty.

Losers - Infosys, Wipro, TCS,   Coal India, ICICI Bank, HDFC, Hero MotoCorp, Bharti Airtel, Bajaj Auto, HDFC Bank, Tata Power and Cipla were the major losers in Sensex and Nifty.

Sectoral - S&P BSE Telecom, Metal, PSU, Capital Goods, Bankex, Realty and Oil and Gas index were top laggards while Bucking the negative trend was the S&P BSE FMCG and Auto index both gained by 0.33% and 0.05% respectively. The S&P BSE Small - Cap index and S&P BSE Mid - Cap index ended lower by 1% each.

On Domestic Front –

1.

It has been decided by the Government of India and the RBI to introduce one billion pieces of Rs. 10 notes in polymer/plastic on a field trial basis. 

The field trial will be conducted in five cities viz. Kochi, Mysore, Jaipur, Bhubaneswar and Shimla with varied geographical locations and climatic conditions. 

Reserve Bank of India has informed that while the primary objective of introduction of polymer notes is to increase its life, it could also help in combating counterfeiting. 

This was stated by Minister of State for Finance,  Namo Narain Meena in written reply to a question in Rajya Sabha 

2.

India’s current account deficit (CAD) as a percentage of gross domestic product (GDP) rose to 5.4% in the second quarter of 2012-13 on account of widening of trade deficit and slower growth in invisibles, the Reserve Bank of India (RBI) said in its monthly bulletin for March released on Monday.

On Global front –

1.

Fitch Ratings has downgraded Italy's Long-term foreign and local currency Issuer Default Ratings (IDR) to 'BBB+' from 'A-'. The Outlook on the Long-term IDRs is Negative. Fitch has simultaneously affirmed the Short-term foreign currency IDR at 'F2' and the common eurozone Country Ceiling for Italy at 'AAA'.

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

IIP was on the line but CPI has made wrong impression and market went for profit booking or say exit from rate sensitive stocks.

The INDIA VIX on NSE surged 6% and ended at 15.13 against previous close of 14.25.

FNO PCR is 1.35 against previous close 1.05. - ITS NOT GOOD SIGN FOR NEAR TERM.

Indian Rupee – Rupee gained y’day by 23 paisa and was trading at 54.18 against its previous close of 54.41/42.

S&P 500 (US) was trading at 1550.74 down 5.48 then its previous close at the time of writing M Bells.

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

Now on event of financial book closer range is changed, now downside range is 5600 while upside is 6200.

Intraday Resistance – 6004 – 5978 – 5946 and Support – 5887 – 5861 – 5829 (Pivot 5919)

Weekly/Monthly Resistance – 6333 – 6143 – 6044 and Supports – 5755 – 5664 - 5466

Opening – Seems flat and Nifty may continue to remain under pressure.

========================  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.)

RIL –

Iraq has shortlisted Reliance Industries and six other firms for developing its Nasiriya oilfield and the construction of an associated 300,000 barrels per day refinery, according to reports.

Reports stated that French energy giant Total, Russia's Lukoil, CNPC of China and American firm Brown Energy shortlisted for the project.

The seven qualified firms will be invited to review data packages and discuss contract terms, says report.

Core Education –

Moody's Investors Service has downgraded the corporate family rating of Core Education & Technologies Limited to B2 from B1.

ONGC & RIL –

Oil & Natural Gas Corp is planning various options to hire Reliance Industries' unutilised production facilitiesto bring to production its gas finds in the Krishna Godavari basin, according to reports.

ONGC "is evaluating various short-term and long-term options, including sharing of infrastructure with RIL," Oil Minister M Veerappa Moily reportedly said.

"A team of ONGC officers has been constituted to carry out technical feasibility for development of some of these fields," Moily reported.

Reports stated that ONGC has made nine gas discoveries in its KG block KG-DWN-98/2.

RIL has pipeline and other offshore and onshore facilities capable of handling gas output of 80 million standard cubic meters per day.

Tata Steel –

Tata Steel Limited through its subsidiary Tata Steel Minerals Canada Limited, entered into a framework arrangement with Labrador Iron Mines Holdings Limited (“LIM”) to establish a strategic relationship between TSMC and LIM whereby the two companies have agreed to co-operate with each other in various aspects of their respective iron ore operations in the Labrador Trough. The Labrador Trough is a 1,100-kilometre long, 160-kilometre wide iron ore bed in the Labrador-Quebec region in Canada.

The trough has delivered more than 2 bn tonnes of ore in last 50 years and has attracted mining investments of $15 bn from leading global companies. It is estimated that the annual iron ore production of this region would increase from current 35 million tonnes to about 65 mn tonnes by 2015. Tata Steel established its presence in this region through an acquisition of 19.9% stake in New Millennium Iron Corporation (“NML”) in 2008. Tata Steel subsequently increased its stake to 27% in NML and also chose to exercise its option to participate in NML’s DSO Project in 2010. Tata Steel holds 80% in the DSO project through TSMC.

Media & Entertainment –

India’s media and entertainment industry has great potential to herald a new era of economic expansion, with the sector poised to double in size by 2017 and aid job creation by removing key challenges including stifled freedom of expression, Uday Shankar, Chairman of FICCI’s Media & Entertainment Committee, said at the inaugural session of the annual FICCI Frames conclave.

Delivering the theme address at the conclave, the foremost business gathering in the media and entertainment sector that brings the industry and policy makers on a single platform, Shankar said efforts to curb free speech in a robust democracy like India is one of the biggest challenges that can potentially derail the industry from its trajectory.

Wipro –

Wipro is targeting $1 bn (Rs 5,400 crore) in annual revenue from energy, utility sectors, according to reports.

Reports stated that Wipro's energy and utilities vertical, contributes around $900 mn, or 15% of total sales.

In the three months to December 31, the unit grew 18% compared to a year ago, report said.

Infosys –

Infosys announced that it has expanded its presence in Latin America with a new delivery center for its business process outsourcing subsidiary, Infosys BPO, in San José, Costa Rica.

The center’s 100+ employees initially will provide key services in the strategic sourcing and procurement area for Procter & Gamble, the world’s largest consumer packaged goods company.

==================== 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.

TCS 1550 PE – bought @21 (1 Lot) SL 15 TG 35+ (Active from 8 Mar 13)

Booked profit @26, gain = +1250

Renuka Sugar 30CE – bought @0.8 (1 Lot) SL 0.45 TG 1.25+ (Active from 12 Mar 13)

=============== 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)

Satyam Computer – @103 TG 130+ SL 112 (Active from 15 Dec 12)

On Mobile – @44 TG 60+ Updated SL 39 Qty 2K (Active from 01 Jan 13)

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

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

MG Blog Since Jan 13 (Total 36,850) + Mar 13 = +11,750 + 1250 (TCS Gain) = +13,000

Billionaire Club Since Jan 13 (Total 67,700) + Mar = +20,700 + 1250 (TCS Gain) = +21,950

Today’s MG Mantra –

Market will wait for Inflation figure.

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.