Morning Bells (11 April 13)

Good Morning Friends.

Difference between Mrityu & Moksha – Saanse khatma ho jaye aur Tammana baki rahe to Mrityu, aur agar Saanse baki rahe par Tammana khatma ho jaye to Moksha.

Note - Today BTST is not possible i.e. if you have bought equities in cash market y'day, you can not sell it today, so be careful else penalty would be there.

 

So as discussed y’day MB, a bounce was expected and today market turned GREED and ended with healthy gain. Here I would like to emphasize, plz refer old range 5600-5630 and then 5735. This rally is not trend changer, the only reason for this rally was FII didn’t sell y’day and FII came to buying counter ahead of key result next week starting from this Friday when Infy will kick the street. Till 5735 is not breached on closing basis trend remain subdued or say down.

The Indian equity market snapped a five-day losing streak on Wednesday. The NSE Nifty, which slipped below the 5500 mark in the mid afternoon trades bounced back sharply led by gains in the Telecom, IT, Banking, Capital Goods and the Realty stocks. Even the Mid-Cap and the Small-Cap stocks witnessed buying momentum. Only the FMCG index ended with losses.

The Auto stocks were in momentum despite a declined in car sales. According to SIAM India’s car sales fell by 6.7% in the financial year that ended in March. Stocks like Tata Moors, Bajaj Auto and Maruti were among the top gainers.

 Gainers –

RIL, Infosys, TCS, Wipro, HDFC Bank, Tata Power, Maruti Suzuki, Bharti Airtel, Cipla, Tata Motors, ICICI Bank, Bajaj Auto and Tata Steel were among the major gainers in Sensex and Nifty. 

Losers –

Sun Pharma, Jindal Steel, HUL, ITC, BHEL, Dr Reddy’s Lab, Sterlite Inds, ONGC, Hero MotoCorp and Mahindra & Mahindra were among the major losers in Sensex and Nifty.

Domestic Front –

Foreign institutional investors (FIIs) continued to offload frontline Indian shares for the sixth consecutive session, making it the longest selling trend in the last 11 months.

Poor returns from the Indian market so far this year and rising political risk may have forced FIIs to offload their stocks. On Tuesday, FIIs net sold equities worth Rs. 6.65 billion, taking the total selling number over the last six trading sessions to over Rs. 15 billion. The benchmark Sensex declined 3.4% or 638 points.

Foreign investors seemed to be concerned with delay in corporate earnings revival and India’s high current account deficit. India’s GDP (gross domestic product) and consumer price index (CPI) numbers are not so good. The country’s current account deficit is presently bad and will definitely remain a challenge. Current account deficit widened to a record high 6.7% of GDP in the December 2012 quarter due to heavy oil and gold imports and muted exports, but the balance of payments turned positive.

On the other hand, domestic institutional investors on Tuesday pumped Rs. 9.89 billion in equities - the highest daily inflow in over 16 months. This also takes their buying streak to six straight sessions – the longest since May 2012.

Global Front –

Globally, today, all eyes are focused on the significant US Federal Reserve policy minutes, whereby investors will derive cues from the apex body’s intent going forward. In this respect, we infer that the probability of a cutback in monetary stimulus has faded, especially after disappointing nonfarm payrolls during March.

The Bank of Japan said Tuesday it will hold a meeting with market participants on April 11 to explain a series of unprecedented easing steps that the central bank decided upon last week. It seems there has been a delayed response to the prospects of monetary injection by the Bank of Japan. The apex body  has  pledged to pump about $1.4 trillion into the economy over two years. Effectively, the repercussion is evident  in  the currency markets as well, with the Japanese yen tumbling and now trading just close to 100 levels.

Most Asian markets ended with smart gains on Wednesday, following a surge in Chinese imports. China swung to a trade deficit of US$880mn in March as imports surged 14.1% from a year earlier. The deficit, which followed February’s US$15.3bn surplus, missed a forecast for a surplus of US$14.7bn.

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

Domestic institutional investors on Tuesday pumped Rs. 9.89 billion in equities - the highest daily inflow in over 16 months. This also takes their buying streak to six straight sessions – the longest since May 2012.

The INDIA VIX on NSE was down 2% and ended at 16.49 against previous close of 16.82.

(Not – my personal view is that Vix can move up max 17 to 17.5 which itself meant a small recovery can be there)

FNO PCR is 0.90 against previous close 0.90.

(PCR is also suggesting its in middle)

Indian Rupee – Rupee gained by 7 paisa and was trading at 54.51 against its previous close of 54.58.

S&P 500 (US) was trading at 1586.70 up 18.09 then its previous close at the time of writing M Bells.

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

Technically if you see to charts, Nifty has final support 5545-35 on daily charts, next small stop seems around 5335 and then good stop seems around 5215. Weekly chart also confirm same, while monthly chart confirm 5215 only. It also show reverse of HNS making pattern till 5215. Stay away from market and wait for clear indication, which down now, just hope is 5545, if broken then next support seems around 5200-5250.

Below 5500 there’s gap which comes 5450, Nifty can try to feel the gap in coming days, not exactly today but in April series.

Once again emphasizing here – its corporate earning month and would remain highly volatile, some mild bounces could be there which can be used to book profits on longs and then to create shorts.

Intraday Resistance – 5684 – 5627 – 5592 and Support – 5500 – 5443 – 5408 (Pivot 5535)

Opening – Again seems with mild gap up, but today we need to be cautious after EU opening.

========================  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.)

Rel Infra –

Reliance Infrastructure bounced back sharply ending higher by 4% on Wednesday. Anil Ambani led company has offered to lower the power prices for Goa government form the existing Rs13.53 per unit to Rs8.58. Goa government has agreed to the proposal since it would save Rs. 57 crore due to decreased power prices. Goa’s state government earlier declared to stop the purchase of power from Reliance from April 1, 2013. The decision was taken to follow the Joint Electricity Regulations Commission (JERC) guidelines and to lower the burden on state exchequer

ITC & Ruchi Soya -

Two Indian companies Ruchi Soya and ITC limited continued its presence in the Deloitte Top 250 list. Ruchi Soya ranked #121 this year, performed remarkably well as compared to its position #175 in the Top 250 list published last year. Another Indian company that retained its place in the list was ITC Limited ranked at #150, a fall from it earlier ranking of #143. Videocon Industries Ltd that made its debut to the Top 250 list last year, thanks to its aggressive organic growth failed to find a place this year though.

Cairn India –

In Q4, average daily gross operated production was 202,014 barrels of oil equivalent (boe), 12% higher than the corresponding prior period. Working interest production was 18% higher at 126,623 barrels of oil equivalent per day (boepd). The increase was driven by ramp-up at the Rajasthan block, where gross production was 22% higher at 168,594 bopd in Q4.

Tata Steel –

Tata Steel completed FY’13 with an overall increase in Production and Sales volumes. The year registered its best ever performance in Hot Metal, Crude Steel, Saleable Steel production and total Sales. The key production and sales figures are given below:

Major Highlights - FY’13 Production
Ore Mines & Quarries (OMQ) achieved its highest ever iron ore dispatch of 15.0 million tonnes (Previous best 13.18 million tonnes in FY’12). West Bokaro Division (one of the Collieries) achieved its highest ever clean coal production of 2.33 million tonnes (Previous best 2.29 million tonnes in FY’12).

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

(Start exiting from stock if Nifty goes below 5500 mark)

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

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

MG Blog Since Jan 13 (Total 50,300) + Apr 13 = = +3150

Billionaire Club Since Jan 13 (Total 1,09,350) + Apr= -5700 + 13,600 (Profit on 9 Apr) = +5,300

(Correction – some ppl have exited hpcl 300CE so deducting 2600 from PL)

Today’s MG Mantra –

Its going high before making good profit and to take fresh short.

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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.