Morning Bells (25 Sept 13)

Good Morning Friends.

Dene me khush hone wale ko koi bhi udas nahi kar sakta, magar… lene per bhi dukhi hone wale insane ko sansar ki koi bhi takat sukhi nahi kar sakti.

After sharp falls in the past two trading sessions, the Indian indices ended on a flat note on Tuesday. For a brief while the NSE Nifty surged past the 5930 levels. However, the gains were short-lived as selling pressure was witnessed at higher levels.

The capital goods, auto, power, consumer durables, healthcare and FMCG were among the top gainers. On the other hand, metals, PSU, telecom and oil and gas stocks were among the top laggards.

As discussed y’day about Govt’s policy ahead of election (read RBI’s move when Rajan went to meet FM) now again y’day Mr. Moily announced for no rate hike in Diesel prices. As the inflation would remain key agenda in next general election Govt. had to decide whether it want to take steps to reduce CAD or Inflation and obvious choice was inflation. Once election will be over Govt. would have 5 years to do it.

Oil Minister M Veerappa Moily reportedly said that government has no plans to raise diesel and other key subsidised fuel prices at present. He’s announced measures aimed at saving $5 billion from the country's huge fuel bill.

Moily has outlined measures including public awareness campaigns.

Moily has said that he could save $8.5 billion in foreign exchange outflows by raising imports of Iranian crude.

Egypt –

Three years has seen the overturn of two government, the deaths of thousands of people and the destruction of much of the Egyptian economy. In the end, the mobs have changed nothing, except to make their own lives more miserable.

It was a year ago in August of 2012 that the Morsi government approached the International Monetary Fund for a 4.8 billion dollar loan. That was an increase from the 3.2 billion dollars that the interim military government had sought and that the Muslim Brotherhood members of the parliament had opposed.

Getting the loan was critical. If Egypt could raise the funds, it would be in a better position to borrow from other sources. The IMF calculated that Egypt needed at least ten to twelve billion dollars to survive for another year. (Source: IIFL)

Why we discussed it here because it will affect crude prices in near future and we are world’s major buyer for that. Increase in crude prices will definitely increase our CAD, increased CAD means to increase in inflation or to pay more taxes.

Economy –

At glance around the current economic happenings. • The economy of the country is taking a beating. The economic fundamentals are in a deplorable condition. • The rupee is in a state of unhindered free-fall and inflation is moving up faster than a shooting star. • GDP growth is experiencing turmoil and corporate performance is at best average. • The stock market is uncertain and sluggish and is experiencing tremors every now and then. • The employment situation is not at all encouraging as there has been across the board job cuts all around. • EMIs’ are moving in tandem with inflation and fuel costs like a luxury item. So what does one do about the economy?

MARKET OUTLOOK –

We are round the corner of expiry and Nifty is closed below 5930. Interesting to see now how Nifty will behave over next couple of sessions. For me I will trade only intraday with right SL. On down side my SL would be 5870 and on upside its 5990. Range is narrow.

MG’s Nifty trading range –

R – 5990 - 6030 - 6145 - 6180 - 6230

S - 5870 – 5850 - 5780 - 5700

Nifty moving band is 5600-6100 and 4900-5600

STOCK OUTLOOK -

(Stock that can see some good moves either side)

Telecom Sector-

Fair trade watchdog CCI says it will take into account the telecom regulator TRAI's proposal to slash spectrum floor price, before deciding on a formal probe into alleged cartelisation among mobile operators.

The Competition Commission of India (CCI) is looking into whether the mobile operators acted as a cartel during the recent airwave auction that had elicited tepid response, but is yet to order a formal investigation into the matter.

CCI Chairman Ashok Chawla said that the Commission would take a final decision in this matter after taking into account the Telecom Regulatory Authority of India's (TRAI) recent recommendation to lower the floor price for spectrum auction.

Cement Sector -

Cement stocks were buzzing in trade y’day. According to experts best time ahead of all the cement companies for next six-eight months because you won't be having any problem because this is now just the passing phase of the monsoon. We have seen good monsoon happening. All the cement makers will be having really very good time till June.

KFA –

Shares of Kingfisher Airlines shot up by 10% to close at Rs5 after reports stated that it was in talks with a foreign investor for a potential stake sale.

CALL LOG –

Keep eye on – Wipro, Rcom, RelCapital

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