Morning Bells (20 Nov 13)

Good Morning Friends.

Me aksar sochta hoon ki waqt ke sath har koi bada jata he… Galati oosaki nahi jo badal jata he balki Galati oosaki he jo pahale jaisa rah jata he.

After 2 days rally market took breather, it decline to move further also due to subdued performance across the global markets. In Asia, Nikkei closed at 15,126 down 37 points, while Hang Seng closed 23,657 down 2.25 points.

Overall banking stocks were in action y’day, SBI was up 3.18%, Oriental Bank was 4.72% up, PNB rose 3.57%, SBI gained 3.18%, BOB was 3.16% up, IndusInd Bank increased 2.38%, South Indian Bank was 2.13% up and J&K Bank was 1.57% up on BSE.

Sentiment got boosted - Based on the recommendations of Foreign Investment Promotion Board (FIPB) in its meeting held on October 24, 2013, the Government of India has approved 20 proposals of Foreign Direct Investment (FDI) amounting to Rs. 915.83 crore approximately. 

New Development – Equal Treatment to FII and FDI

Finance ministry and a Reserve Bank of India panel is working on proposals to ensure equal treatment for foreign institutional investors (FIIs) and foreign direct investments (FDIs). The panel has discussed a 49 percent cap on FII investment.

The Budget had put forth the proposal saying that FII and FDI definition should be clarified, below 10 percent would be FII and above that would be FDI. The panel which includes the Economic Affairs (EA) Secretary Arvind Mayaram, Reserve Bank of India (RBI) Deputy Governor HR Khan as well as Securities and Exchange Board of India (Sebi) EDs is looking at building this transition mechanism.

The panel has discussed that there should be a 49 percent cap for FII and FDI tends to come in through the portfolio route because there are no conditions on FII investment. FII investment can go up till the sectoral cap with just a board resolution. In order to ensure that, for instance in multi brand retail, the FDI that comes in meets with stringent conditions and the FII doesn’t. In order to ensure equal treatment, there should be a 49 percent cap on FII investment.

MARKET OUTLOOK –

Next week is important for market, first we have expiry in that week and same time state election will begin. Two weeks from now the state election results are expected to come out. If the factors which people are expecting for the change in the government probably does happen.

Bias remain positive but volatility can take place as we are heading towards expiry.

Opening seems on Negative note as most of Asian market ended in red and EU and US are also trading in negative territorial.

MG’s Nifty trading range –

R – 6230 – 6290 – 6350

S –6120 – 6080- 6020 – 5980 (Trend Changer level 5950)

ECONOMIC EVENTS / RESULT CALENDAR –

03 Dec 13 – Power Grid OFS

OI Activity –

Nifty call options added 13.46 lakh shares in open interest whereas put options added 25.95 lakh shares in open interest.

STOCK OUTLOOK -

(Stock that can see some good moves either side)

BHEL –

Reposing confidence in Bharat Heavy Electricals Limited (BHEL)’s proven technological excellence, NTPC Ltd. has placed a major order on the company for supply and installation of the main plant package for a power project in Uttar Pradesh, involving one thermal power generating unit of 500 MW.

Valued at Rs. 13,000mn, the order for the supply and installation of the Steam Generator, Steam Turbine Generator and Electrics Package for the upcoming 500 MW Feroze Gandhi Unchahar Thermal Power Project (TPP), has been received from NTPC BHEL Power Projects Private Limited (NBPPL), a joint venture between NTPC and BHEL.

ICICI Bank –

ICICI Bank on Monday hit the overseas bond market to raise $500-$750 million under its $5 billion global medium-term note (GMTN) programme.

The initial pricing of the loan is 3.75 per cent over the US treasury. The amount would be raised through the bank’s Dubai International Finance Centre branch.

Power Grid -

State-run Power Grid Corporation of India 's sale of shares, valued at about USD 1.2 billion, is likely to open on December 3, three sources with direct knowledge of the matter said, in a process that could revive the government's divestment programme.

Power Grid said on Monday that it had filed for a follow-on offering of 78.7 crore shares, or 17 percent stake, with the market regulators.

The offering includes fresh issue of 60.1 crore shares and disinvestment of 18.5 crore shares, or 4 percent stake, by the Indian government.

MBC PL –

Oct PL = -6600 - 700 (Loss Nifty 6200 PEs) = -7400

Open Call –