Morning Bells (05 Jul 13)

Good Morning Friends.

Expectation is injurious to… Health & Heart.

It was a great clue but we just failed to take benefit, I was a bit confident about Thursday’s (exactly 2 days) green ending and we discussed it on Wednesday on FB. Well today I also expect green to continue at least till slag hours.

Well, a sudden bout of buying in IT, FMCG, telecom, realty, oil and gas and auto stocks gave reason to cheer the market. Its also a good sign that Nifty closed above its 200DMA. I am enjoying this moment as specially this time FIIs are finding hard to keep ball in their court. So may be a small time story like what FIIs did with Indian market in past quite a few time, this time, same can be repeated by DIIs. So lets watch.

The markets opened with a positive gap in early trade and managed to maintain its momentum in the first half. However, benchmark indices got a whipping after Reserve Bank Governor D Subbarao said the central bank was not looking to protect any particular level of exchange rate but will iron out volatility.

But soon strong European and Asian markets lifted sentiment in the second-half.

New Banking Licence –

The 26 applicants for new bank licences in India face tough requirements that are likely to lead to only a limited number receiving licences and developing into substantial banks, Fitch Ratings says.

The central bank's objective to address financial inclusion places heavy demands on profitability and capital, and is likely to lengthen the time it takes for a successful applicant to establish a presence.

Gainers –

Reliance Infrastructure, HCL Technologies, ITC, Tata Power, BPCL, TCS, Tata Motors, ACC, Hindustan Unilever, Infosys and Bharti Airtel were among the gainers.

Losers -

BHEL, Tata Steel, Sesa Goa, Cipla, Axis Bank, PowerGrid, Bajaj Auto, Ranbaxy, Maruti and M&M lost out.

Sectoral –

The banking index was up 0.5%, rebounding smartly from its previous day’s losses. The gainers include Bank of India (2.5%), Yes Bank (1.5%) and IndusInd Bank (1.2%)

Domestic Front –

Global Front –

ECB holds rates -

The European Central Bank left interest rates unchanged on Thursday and will try to reassure investors rattled by new turmoil in Europe and the US Federal Reserve's plans to begin winding up its stimulus.

The ECB met against a backdrop of political crisis in Portugal that pushed its benchmark bond yields above 8 percent on Wednesday, a spike that stirred angst in financial markets already jittery after the Fed last month set out a plan to exit from its money-printing programme.

The tensions there, and in Greece, risk sapping confidence a year after ECB President Mario Draghi imposed some calm by vowing to do "whatever it takes" to save the currency.

Despite the tensions, the ECB left its main refinancing rate on hold at 0.5 percent and the deposit rate at zero, as was expected by economists in a Reuters poll.

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

Now all the cues are in front of us, ECB is over, Egypt came to a resolution and now RBI policy is on 30^th July. So just make small positions and exit with small amount is the best suggestion.

The INDIA VIX on NSE was up by 3.84% and ended at 18.91 against previous close of 18.21.

FNO PCR was 0.97 against previous close 0.94.

Indian Rupee – Rupee declined by 56 paisa and was trading at 60.22 against its previous close of 59.66.

S&P 500 (US) was trading at 1615.41 up 01.33 than its previous close at the time of writing M Bells.

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

Nifty is closed above 200DMA, 5935 will again see some declines. As per current data upside seems capped around 5970. So if you are long SL should be 5740-50.

Opening – As per expectation, today we are also going to see GREEN.

========================  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.)

Tata Powre –

Tata Power Solar, the leading Indian solar company, has won a prestigious 50 MW solar photovoltaic project from NTPC as part of their mandate to expand their renewable energy portfolio to 1,000MW by 2017.

The new flagship 50MW project, at Rajgarh, Madhya Pradesh, will double NTPC’s solar capacity. Once commissioned in March 2014, the project is expected to generate 78.66 million units (Kwh) of energy each year for MP Power Trading Company Ltd. for a state that runs annual peak deficit of 9.6% (per CEA, June 2013).

IDFC –

A Delhi district court has rejected the anticipatory bail plea of IDFC Capital CEO Tapasije Mishra in a case filed against him by a woman alleging sexual abuse, intimidation and breach of trust.

The complainant, a divorcee with a nine-year old son and a former air hostess with Emirates Airlines, in an FIR filed with the Vasant Kunj police station (New Delhi), had alleged that Mishra had sexual relations with her for the last three years while promising to marry her. Mishra then backtracked on his commitment, and his father (also named in the FIR) threatened the complainant with dire consequences unless she stayed away from him (Tapasije), she alleged.

Interesting to know –

The Foreign Institutional Investors (FII) ownership in consumer companies has risen steadily in the past three years and now it is at an all-time high.

Jubilant FoodWorks  -  almost 42%, Marico – above 30%, Godrej Consumer, Dabur, TTK Prestige, Colgate, United Spirits in all this companies FII stake is more than MSCI weight while in United Breweries, HUL and in Asian Paints FII ownership compared to the MSCI weight is substantially lower, in HUL, it is 10 percent lower. In ITC its also much lower.

In short, FII can affect above stocks where its exposure is higher and can affect less where its weight is lower.

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

Apollo Tyre – 62.5CE @2.75 SL 2 TG 4+ (Max 1 lot)

TRACK Today –

Yes Bank, ICICI Bank, Rcap, RIL, TM and Nifty call straddle.

=============== INVESTMENT BASKET ===============

(Stock in this section is with view of 3 months to 1 year)

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

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

MG Blog Fronm Jan 13 to April 13 (Total 58,800)

Billionaire Club from Jan 13 to June 13 (Total 1,25,600)

Today’s MG Mantra –

Go for cautious approach after 1.30PM as weekend is there.

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.