Off the track - Weekend Special

Posted this page just to discuss some other topic and issues. Please feel free to share your thought on various subjects and issues.

Morning Bells (14 Sept. 12)

Good Morning Friends,

So finally Govt. declared hike in diesel prices by Rs 5 per ltr effective from midnight last night, and kept petrol, kerosene and LPG rates untouched. This can be considered as bold move by expert and is aimed to control the country's heavy fiscal deficit and to send strong message to Grading institution who were threatening for to downgrade India rating for investment to junk.

Well y’da evening cabinet committee, headed by the Prime Minister, agreed to raise diesel prices by Rs 5 per litre, secondly they restricted sales of subsidised LPG cylinders to six per consumer annually, and kept petrol and kerosene prices unchanged. But to give relief to oil companies the excise duty on petrol has been cut by Rs 5.50 per litre. Petrol was suppose to hike of Rs 6 per litre to reduce oil-marketing companies’ under recoveries by Rs 20,300 crore but the government offset that by reducing excise duty from existing rate of Rs 14.78 per litre.

Today there’s another round of CCAP to discuss few more reforms, which includes National Policy on Information Technology,  the new Information Technology Policy, which aims to make at least one individual in every household e-literate among other objectives. The policy aims to help increase revenues of the Indian IT and ITeS industry from USD 88 billion to USD 300 billion by 2020 and ramp up exports from USD 59 billion to USD 200 billion by 2020. (Reports MoneyControl.com)

Agenda also include decision on disinvestment of PSUs to achieve disinvestment target of Rs 30,000 crore in the current fiscal, the government can consider the proposal of stake sale in five state-owned companies including (proposed by The Department of Disinvestment (DoD)) Hindustan Copper, Oil India (10%), Nalco (12.15%) and stack sale in Neyveli Lignite (5%) and MMTC. Meeting to also consider initial public offering (IPO) in the Rail India Technical and Economical Services (RITES) - (Reports MoneyControl.com)

Now there's uncertainity for proposal to allow FDI in aviation sector will be approved by the committee on Friday. Well amid uncertainty shares of Jet Airways gained 2.4% while KFA rose 6.3%. While Shoppers Stop and Pantaloon retails seen selling pressure.

Now all eyes on Fed for further easing, Asian markets closed mixed European stock closed lower y’day, as investors turned cautious ahead of the outcome of a two-day monetary policy meeting in the US.

MARKET OUTLOOK -

As told in past 2 days, now all news is in favor of market, So overall its sentiment booster, cheers the rally till it continue, just remember today is Friday so just take precaution in later half specially around closing time.

Still there's a catch - allies will have strong oppose, opposition is set to protest while cancellation of 4 coal blocks can also play a role to dismiss the rally in coming sessions. 

Inflation data which will be announced today can also play role of breaker to current rally.

A gap up opening is expected. And seems volatile afterward, as day will pass market can strongly reacts on news flow.

NIFTY –

All is in favour of market at the moment. Huge longs were created in 5600 calls, arpx 13 lac shares added y'day and now 5600 calls has highest OI on long side while aprx 7 lacs share were too also added to 5700 call. On downside aprx 13 lac shares were added to 5400 put (same trick before ECB, this time for Fed, but Govt.'s move disappointed bears), so as told y’day now 5400 mark will act as base till expiry. But there’s also a point not to ignore is still 5300 put is holding highest OI which is above 1 crore give sense of weakness in coming sessions or say from Nifty around 5550-5600 mark. Now Nifty will face resistance at 5500 (if opened below) then at 5545 & strong resistance at 5600 while downside will find support 5473 & 5448. Now Nifty seems in the range of 5400-5600.

STOCK OUTLOOK -

Banks – Rally would support banks.

One can also keep eye on stocks which I have mentioned for disinvestment could be a good bet for midterm.

TM- In past 6 sessions TM climbed from 228 to 264 so there was profit booking and fear was obvious. Resistance has comeup to 267 & 272 while support comes to 254 & 249. Would be interesting to see how market reacts on diesel price hike and how its going to affect auto sector specially diesel vehicle makers.

OPEN CALLS –

Will find call and will announce on board.

Cox&Kings - (TG 148, SL 121) its below its good support 129, will wait for mkt and then will think to average our buying levels.

Note – One can also find Morning Bells at MudraGuru.blogspot.in (every time to find it on single click rather than to scroll here) One can also find live calls during market hours here.

Today’s MG Mantra –

Enjoy the ride with precaution. Don’t go against market sentiment as many of you were asking me to create short positions.

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 (13 Sept 2012)

Good Morning Friends,

Oops!, finally fear of German verdict went smooth and IIP to was out of big disappointment.

So today I have nothing much to say, we just need to watch how further things are going to take place, just play with market sentiment and don’t go against it.

Well, the meeting of Cabinet Committee on Political Affairs (CCAP) which was originally scheduled for Tuesday evening was postponed and now the chances they may meet today evening to decide on raising diesel, cooking gas and kerosene prices. CCPA is headed by Prime Minister Manmohan Singh and it includes ministers from allies of the UPA alliance to discuss important decision, Oil Minister S Jaipal Reddy had already stated that a hike in diesel, LPG and kerosene prices is unavoidable as rise in crude oil prices and fall in rupee had led to jump in cost of raw material. So now market will eagerly wait for meeting result.

As per media reports PSU oil firms are losing a record Rs 560 crore per day on the sale of regulated diesel and cooking fuels, and another Rs 16 crore a day on petrol which of course Govt. is losing from its und. Now it would be important to see how market takes it.

For time being we can cheer the positive verdict from the German Constitutional Court on both front Global as well as Domestic.

Now all eye will be on Fed for further easing, if the Fed does not go ahead with another round of QE3, I feel markets would be disappointed and that would be time to exit from longs.

So except Fed now we will look for domestic environment which looks good time being – RBI Monitory policy meet, Govt.’s action on Pending reform bills and moreover CCAP meet’s decision on fuel price hike. Monsoon is also picking up and FII flows to India increasing steadily over the past couple of months. But main trigger for market would be decision on fuel price hike.

MARKET OUTLOOK -

Had told you on Friday that aprx. 10 lac shares were added to 4900 put and would be good for bulls, today it proved right. Instead of profit booking at higher levels it moved up with handsome gain. So now market seems either range bound or in consolidation mode as indices gained fair amount and short term investors can look for part profit booking.

Opening seems mildly bearish.

NIFTY –

As told y’day Nifty was stopped at 5435 for further move, now Nifty will face resistance at 5450 & 5470 while support seems 5425 and 5395. FII have initiated fresh longs in index future, 5600 call has highest OI while bears have made fresh position in 5300 & 5400 puts. Bears need to save 5495 till next few session to move above 5500. So in future if bull get success to maintain 5400 mark will act as base till expiry.

Trend remains buy on dips till 5335 is safe on closing basis. Yes still trend changer on lower side is 5335.

STOCK OUTLOOK -

Banks – Now all eye will be on banking sector ahead of RBI meet. Bank lovers can keep eye on SBI & ICICI.

TM- TM surprised all 5% upmove, as had suspected that this time operators will play tricky and they played against hopes of all. Well our friends made good profit in TM 250, 260 & 270 calls. Though I am a bit disappointed that due to me some of you have made an early exit, but what should I do, no one would have expected such a big move and I remain safe player. Today I think TM could be under pressure. So for me its watch today, if found anything good will share on board. Operators had also know that many people would have made short positions as 258 was the base and that’s TM went above all expectations. Now resistance at 268 & support comes at 254.

OPEN CALLS –

(Now we need to close our open positions slowly-slowly. Liquidity lover can also close their positions)

Infy – Again made position around 37 and booked profit @44, now call closed.

Apollo Tyre – (bought @94 and @92) – Booked profit @98 call closed.

Cox&Kings - (TG 148, SL 121) its below its good support 129, will wait for mkt and then will think to average our buying levels.

FDC - (Bought at 88) booked profit @94 now call closed.

Bank of India - (bought 258) booked part profit at 262, now call closed.

Today’s MG Mantra –

Enjoy the ride with precaution. Make positions according to Nifty move, don’t go against market sentiment.

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 (12 Sept 2012)

Good Morning Friends,

As already informed on Monday that fuel hike seems off the table comes true y’day, the CCPA outcome says a hike in the prices of diesel, LPG and kerosene was put off apparently following strong reservations within the Congress even though Oil Minister S Jaipal Reddy said the increase was unavoidable. As per oil minister stated that oil companies is bearing losses of Rs 1.88 lakh crore due to rise in crude oil prices and fall in the rupee. Now this matter will take up in the forthcoming meeting of CCPA which is likely to held on September 18 to have a fresh look on the issue.

The cheer for market was - RBI on Tuesday raised the limit of external commercial borrowings by any individual company or group. As per the new regulation, a company can borrow offshore funds to the tune of 75% of the average foreign exchange earnings in the immediate past three years or 50% of the highest foreign exchange earnings realized in any of those three years, whichever is higher.

The effect of this policy is - Currently, a company is allowed to raise 50% of the average annual export earnings during the same time mentioned above. This measure is likely to serve the twin benefits, it will bring some stability in rupee’s movement against the U.S. dollar, and the high rate of inflation too can be controlled on account of lower input costs. Importers are benefitted as rupee becomes strong from steady. No doubt, it will prompt a positive sentiment in the market.  (Source MoneyControl.com)

Also Govt’s statement boosted the market sentiment - the Govt. on Tuesday said it will take fiscal measures to control inflation so that the RBI can look at growth oriented monetary policy. This once again raises the hopes for banking sector.

Germany’s Federal Constitutional Court is due to rule on Wednesday on the country’s participation in the European Stability Mechanism (ESM), as I flashed news during the day that German parliament won’t oppose to ESM. So that was the only reason market recovered later.

Today all eyes will be on domestic front - markets will react to the latest industrial production data which is expected at 11AM, so cautious approach is suggested, better to book profit in first half and then to wait for EU cues. If I see reports on various Industrial output is slowing down but main point is how our big experts (FIIs & DIIs) consider the output, only their view will decide the action of later part.

Once again, the week is full of thrill and volatility on both domestic as well as on global front. So enjoy the ride till it long last.

MARKET OUTLOOK -

Market has taken some breathing space but Market will remain highly volatile and people may lose who will be without SL in the market. As today it has 2 shocking wave (IIP & German verdict), sorry friends it was confusion about IIP in mind y’day when I was writing text and I thought y’day was 12 and that’s mentioned IIP no.s in y’day M Bells though I mentioned date correctly. Well today is that day and keep eye on it.

Opening seems sedate ahead of important decisions i.e. positive one.

NIFTY –

Finally Nifty has crossed 5385 and now on the door of 5400. Since OI increased in NF indicating fresh longs were created in Nifty & Bank Nifty. As I had mentioned that till 5335 is safe on closing basis trend remain buy on dips and Y’day Nifty got support there.

I believe as per current data that now Nifty is in the range of 5300-5500, so at the moment we are in the middle. 5335 will still act as trend changer. Now supports comes to 5365 & 5350 while Nifty face resistance at 5400 (if not opened above 5400 mark) and then 5415 & 5435. So data shows Nifty will remain in narrow range till result of any one event.

Trend remains buy on dips till 5335 is safe on closing basis.

STOCK OUTLOOK -

Banks – Banks remain in news and can show strength if IIP & German verdict go smooth. Bank lovers can keep eye on SBI & ICICI.

TM- Finally it made breached 250 marks but again went back to seat. As suggested TM will face resistance to its favourite band 252 then 254 and then 257, so as suggested 254 seems best level to book profit. While 241 will act as ultimate SL for longs. If everything goes smooth with market we will see TM around 254, how long it will stay there can’t say. We have also build some position in TM 260 (@3.5) & 270 (1.5) calls.

OPEN CALLS –

(Now we need to close our open positions slowly-slowly. Liquidity lover can also close their positions)

Infy - Y’day we made good profit in Infy 2550 call, initiated @30 and booked part profit at 42. Chances are still bright with Infy may be a gap up opening. 2550 is the level where one should need to take precaution.

Apollo Tyre – (bought @94 and @92) hold stock for updated TG 98+ with SL 86.

Cox&Kings - (TG 148, SL 121) its below its good support 129, will wait for mkt and then will think to average our buying levels.

FDC - (Bought at 88) hold for TG 94+, SL 78

Bank of India - (bought 358) TG 375+ SL 352

Today’s MG Mantra –

Don’t make fresh position till IIP Nos. If you are going long then make only Intraday positions.

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 (11 Sept 2012)

Good Morning Friends,

As told y’day that due to microeconomic condition and growing concerns about Govt's inability to push reform investor will choose to book profit at higher levels, mkt was in consolidation mode.

Some of would have also remember my prediction about EU one and half month back when I had told you regarding EU worry was “I clearly see that EU dragon is on his way and how much time it will take I don’t know” once again hammering my mind because EU debt keeps going higher and higher, once again Dragi’s promise has given some breathing space time being but not solution. I am mentioning it here only because I want you to keep it remembers. And why telling you right now because now its time to play cautious, don’t set too high TGs for your longs and book part profit time to time else one good day will be well enough to swallow your all earnings.

Once again, the week is full of thrill and volatility on both domestic as well as on global (EU) front. Today we have IIP No. announcement, keep eye on it.

Also The German constitutional court’s verdict on the legitimacy of the European Stability Mechanism (ESM) will be keenly watched. Market can lose its cheers ECB’s bond-buying plan if the German court delivers an unfavourable verdict.

US Fed QE3 will also be eyed this week.

MARKET OUTLOOK -

Market will remain under pressure (at least first half) as today we can have 2 shock wave which are IIP Nos and The German constitutional court’s verdict on ECB result. Macroeconomic concerns & inability of policy reform are also there and may prompt investors to book profits at higher levels and that’s FII booked profit in index future on their long positions Y’day and can continue with profit booking ahead of uncertainty. In cash segment FIIs bought 6.92bn in cash segment while DIIs sold 3.18bn as per provisional figures released by the NSE.

So right now there is nothing much to say as its action packed week and market can take any direction according to various events lined up this week.

So cautious approach is suggested and book part profit on rallies to safe your investment.

NIFTY –

Now data shows Nifty range 5280-5400-5450 indicating upside seems capped.  If Nifty continue its upward journey it will face resistance at 5386 - 5400 - 5450 while on downside if Nifty goes below 5335 then selling pressure can drag Nifty to 5335-5300 - 5280.

Trend remains buy on dips till 5335 is safe on closing basis.

STOCK OUTLOOK -

Banks – Banks remain in news this week ahead of RBI policy review, Govt.’s action and festive session.

TM- As suggested Y’day TM crossed 246 and attempted to 250 and didn’t success, made high 248.9. It was expected that TM won’t success in very first attempt. Now TM will face resistance on 252 & 255 while intraday support is 244 and longs SL is 239. So it’s a watch, in 250-255 range (if it goes to that range) it will give thought for taking some PUT options, of course after having look of market sentiment. Y’day fresh short created and OI decreased showing profit booking in index future.

OPEN CALLS –

(Now we need to close our open positions slowly-slowly. Liquidity lover can also close their positions)

Apollo Tyre – (bought @94 and @92) hold stock for updated TG 98+ with SL 86.

Cox&Kings (TG 148, SL 121) its below its good support 129, will wait for mkt and then will think to average our buying levels.

FDC (Bought at 88) hold for TG 94+, SL 78

Bank of India (bought 358) TG 375+ SL 352

Today’s MG Mantra –

Don’t make fresh position till IIP Nos. If you are going long then make only Intraday positions as market mood is not decided yet.

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.