Morning Bells (08 Oct 13)

Good Morning Friends.

When we trust a person we think that they are with us forever to share our pain. But time reminds us that tasty fruits are only seasonal.

Once again Indian equity market ended flat on Monday with the NSE Nifty managing to sustain above the 5900 mark. As discussed our strong support 5840, markets took a sharp turn and bounced back taking support at its 200 DMA. So here 5840 and 5960 are key levels and market to behave like that till it doesn’t break either side.

Buying momentum in the pharma, metal and telecom stocks lifted the market to close near day's high while among the major laggards were, the banking, capital goods and realty stocks. The BSE IT index was in momentum and was the top gainer among the BSE sectoral indices.

Some good news from RBI counter - Starting with the Mid-Quarter Review of September 2013, the Reserve Bank of India (RBI) began a calibrated withdrawal of exceptional measures undertaken since July 2013. This was done with a view to normalising liquidity conditions. Accordingly, the marginal standing facility (MSF) rate was reduced by 75 basis points from 10.25 per cent to 9.5 per cent.

MARKET OUTLOOK –

On charts Nifty contradicted its bearish head & shoulders pattern and closed above its 200-DMA for the week. This is good sign in terms of current bounce but still Nifty to do a lot, first it need to cement its 5800 mark to move further and secondly to generate buying interest it need to close above the range of 5990-6020. Till then sentiment remain dicy.

Mainly market will behave next week on Q2 earnings and economic data.

MG’s Nifty trading range –

R – 5960/74 – 6020 - 6094 – 6140/45 – 6230 (5990-6020 range can be act as crucial resistance and trend changer)

S – 5840 – 5762 - 5670 – 5610 – 5552 - 5516

Nifty swing band is 5600-6100 and 4900-5600

DMA – 100DMA – 5806, 200DMA - 5840

Technical Trend changer supports – 5715 – 5580 – 5535 – 5250 - 5120

ECONOMIC EVENTS / RESULT CALENDAR –

11 Oct – IIP & PMI data, Result – Infy

12 Oct – Dussera Holiday

14 Oct – WPI, Result Baja Corp, Indusind Bank,

15 Oct – HDFC Bank, TCS

16 Oct – Bajaj Auto

17 Oct – US senate voting decision, Result HCL Tech.

21 Oct – Result – KTK Bank

STOCK OUTLOOK -

(Stock that can see some good moves either side)

New Banking License – again in news

Finance Minister P Chidambaram said that the Reserve Bank of India (RBI) would shortly issue seven licences.

Speaking at a conference at State Bank of Mysore, in Bangalore on Saturday, Chidambaram said the new banks should not try to become clones of existing banks.
According to Chidambaram, the new banks which would receive banking licence shouldn’t look like each other with different names. Each bank should cater to the needs of a special group of customers.
“We will have competition, efficiency and progress only if people attempt different things and do things differently,” he added.

IT Sector –

Big IT firms such as TCS, Infosys and Wipro are expected to announce strong earnings for the July- September quarter, helped by a steep decline of the rupee against the US dollar and improved demand for outsourcing services.

Apollo Tyre –

Shares of Apollo Tyres surged over 4% after the company and U.S.-based Cooper Tire disagreed over price Apollo Tyres should pay in its takeover. The disagreement over price came to light after Cooper on Friday filed a complaint in a U.S. court to force Apollo to close the acquisition "in a timely manner"

Coal India -

Coal India declined by 3.2% after reports stated that the government will offload its 5% stake in the company by way of follow-on public offer (FPO) in December.

Bombay Dyeing –

Shares of Bombay Dyeing shot up over 12% on media reports that three private equity funds are in talks to buy up to a 24% stake in the company.

L&T –

L&T has secured two EPC projects of about Rs1100 Cr value in hydrocarbon segment in UAE and Qatar.

Takreer (a subsidiary of state-owned Abu Dhabi National Oil Company- ADNOC) awarded an EPC project of a new Aviation Fuel Terminal at Abu Dhabi International Airport for developing storage and delivery of Jet A-1 fuel.  The project is scheduled to be completed in 30 months.

Coal India –

Coal India declined by 3.2% after reports stated that the government will offload its 5% stake in the company by way of follow-on public offer (FPO) in December.

MBC PL –

Oct PL = -1000 + 250 = -750

Bajaj Auto 2000PE @30 Updated SL 32 = +250

Open Call –

Infy call spread – 3400CE @72 & 2700PE @80 combined premium = 152 SL 100 TG – Will announce.

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