Morning Bells (25 Mar 13)

Good Morning Friends.

In life don’t trust people who change their feelings with time, instead trust those people whose feelings  remain the same even when the time change.

So once again we are in expiry week. Week which is again the truncated week of three days may see some volatility but remain in the favour of bulls expect some pressure ahead of Cyprus issue around Thursday.

Domestic Front –

Single Regulator for Financial Sector -

The turf war between regulators could be a thing of the past if the proposals of the Financial Sector Legislative Reforms Commission (FSLRC) headed by Justice (retd) BN Srikrishna. The panel has proposed a single regulator or unified regulator for all financial sector laws which include markets, insurance, commodities and pension. 

In other words SEBI, the Forward Markets Commission, the Insurance Regulatory and Development Authority and PFRDA could be converted into a new unified regulatory agency.

Banks can breathe easy as banking has been kept out of the purview. According to reports, Srikrishna said ‘the report does recommend that in the long run even the RBI should be brought within the ambit of the unified regulatory agency.’

The report was handed over to Finance Minister P Chidambaram today and the FM is expected to discuss the report with Prime Minister Manmohan Singh on Saturday.

Cash Settlement in F&O –

Effective April 26, 2013, trading on all existing single stock futures & options contracts (including all monthly and weekly expiry contracts) expiring on or after April 26, 2013 will be settled in cash (settlement by payment of difference). 

All single stock futures & options contracts i.e monthly and weekly expiry contacts expiring till April 25, 2013 will continue to have delivery based settlement. There will be no change in other contract specifications like contract size, strike intervals, number of strikes for options, expiry day, and calculation of settlement price. 

The BSE has decided to change settlement mechanism from delivery based settlement to cash settlement in Stock Futures & Options Contracts in BSE’s Equity Derivatives segment. 

Effective April 26, 2013, trading on all existing single stock futures & options contracts (including all monthly and weekly expiry contracts) expiring on or after April 26, 2013 will be settled in cash (settlement by payment of difference). 

All single stock futures & options contracts i.e monthly and weekly expiry contacts expiring till April 25, 2013 will continue to have delivery based settlement. There will be no change in other contract specifications like contract size, strike intervals, number of strikes for options, expiry day, and calculation of settlement price. 

Current Account Deficit –

In an effort to bridge the widening current account deficit, finance minister P Chidambaram has said that limits for FII investment in corporate bonds and long-term infrastructure bonds will be merged effective from April 1.

The key decisions announced by the FM are that the limits on FII fungibility for securities is going to be USD 25 billion and the limits for long-term securities as well as old securities will be merged. On corporate and long-term infrastructure bonds, the three different limits that are currently in use will now be merged into one limit of USD 51 billion.

Global Front –

Cyrpus Cause -

Cyprus is preparing for total financial collapse as the European Central Bank turns its back on the island after its parliament rejected a scheme to make Cypriot citizens pay a levy on savings deposits in return for a share in potential gas futures to fund a bailout.

On Wednesday, the Greek-Cypriot government voted against asking its citizens to bank on the future of gas exports by paying a 3-15% levy on bank deposits in return for a stake in potential gas sales. The scheme would have partly funded a $13 billion EU bailout.

It would have been a major gamble that had Cypriots asking how much gas the island actually has and whether it will prove commercially viable any time soon.

In the end, not even the parliament was willing to take the gamble, forcing Cypriots to look elsewhere for cash, hitting up Russia in desperate talks this week, but to no avail.

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

In the current series 5600 Put indicates a strong support for the market. Renewed buying has started coupled with short covering. Heavy shorts are seen in the market. One can take the case of PSU banking, cement, automobile and more specially the two wheelers.

Market remain supportive this week and will be in favour of bulls only exception about Cyprus issue which is slated for Thursday. Technically its showing 5550 before any upmove further.

The INDIA VIX on NSE was down 1% and ended at 16.51 against previous close of 16.66.

FNO PCR is 0.88 against previous close 0.92.

Indian Rupee – Rupee remained flat and was trading at 54.33 against its previous close of 54.28.

S&P 500 (US) was trading at 1554.65 up 8.85 then its previous close at the time of writing M Bells.

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

As per current outlook Nifty range is 5600 on downside while upside is 6200.

Intraday Resistance – 5744 – 5717 – 5684 and Support – 5624 – 5600 – 5565 (Pivot 5658)

Weekly/Monthly Resistance – 6144 – 6057 – 5965 and Supports – 5785 – 5698 - 5606

Opening – Seems small positive but remain choppy.

========================  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.)

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

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

(Book profit in your 50% holdings and keep balance with SL 119, on 18 Mar 13)

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 = +13,450

Billionaire Club Since Jan 13 (Total 67,700) + Mar= 41,650

Today’s MG Mantra –

After repeated request finally I am giving a try to Face Book, but I have restricted that a bit, people who want’ to join me on FB need to request here.

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.