Tuesday, February 17, 2009

Market Wrap - NSE / BSE 16th Feb 2009


Sensex ends 329 pts down on heavy selling in heavyweights

3:40 PM: Weak global sentiment and lack of market friendly announcements in the interim budget knocked the wind out of stocks cutting across sectors on the Indian bourses today.

Interim Budget 2009

The Sensex, which crashed to a low of 9279.10 in afternoon trade, ended at 9294.21 (provisional) with a loss of 340.53 points or 3.53%.

The Nifty closed at 2845.15, slightly off its day's low of 2839.10, with a loss of 103.20 points or 3.5%.

Realty stocks, which opened on a bright note on expectations of some incentives from the budget, tumbled due to lack of positives from the budget and were among the prominent losers in the end.

Metal, capital goods, bank, oil and power stocks also went down sharply.

It was not a good session for PSU, IT, Telecom and pharma stocks as well.

Auto stocks began well but lost their way around noon and settled way down from their morning highs.

Select FMCG stocks bucked the trend and edged higher.

There was heavy selling in midcap and smallcap stocks in afternoon trade.

JP Associates, Reliance Infra, ICICI Bank, RComm, L&T, RIL, Tata Steel, SBI, BHEL and Sterlite lost 4% - 8%.

Wipro, Ranbaxy, HDFC Bank, Hindalco, ACC, DLF, NTPC, HDFC, Infosys and ONGC also closed with sharp losses.

Reliance Capital, Nalco, Siemens, ABB, Unitech, Power Grid, RPower and RPL lost 5% - 8%.

Idea Cellular, Tata Comm, Suzlon, SAIL, Ambuja Cements, PNB, Cairn and BPCL also closed sharply lower today.

The market breadth was weak right through the session.

3:26 PM: HBL Power Systems is reportedly in the process of setting up of a joint venture in the Kingdom of Saudi Arabia with Advance Electronics Company and Abdullah H AI Shuwayer & Sons T&C Co as local JV partners.

The JV company will be named as Gulf Batteries Company. The proposed joint venture is to set up a unit to manufacture Industrial Batteries in the eastern province of KSA at an estimated project cost of about USD 28 million.

One can stay invested in the thinly traded stock for now with a stop loss at Rs 100 - 105.

3:20 PM: The market is likely to struggle for the better part of the year 2010 and it won't be surprising if it re-tested October 2008 lows.

Investors willing to wait for three to five years for solid returns will get plenty of opportunities to go in for blue chip stocks at attractive levels later this year.

3:12 PM: TCS (Rs 500) can be retained with a stop loss around Rs 420.

Investors looking at long term can pick more of this stock at declines.

Infosys, HCL Technologies and Oracle Financial Services can also be bought in small quantities at declines.

3:00 PM: The market has slipped deeper into the red now due to heavy selling across the board.

Metal, bank, realty, capital goods, oil and power stocks have tumbled. Several PSU and IT stocks too are reeling under the sustained onslaught. Mid and small cap stocks have plunged as well.

2:53 PM: Investors with a low appetite for risk and are looking at fresh exposure in bank stocks can wait for a few sessions.

Several bank stocks are likely to see some downside over the next few sessions and it is worth waiting for a while.

2:41 PM: ITC (Rs 179) can be picked up at sharp declines.

Investors with a long term plan can continue to hold the stock with a stop loss near Rs 140.

Marico, Dabur India and Hindustan Unilever can also be accumulated at declines in a staggered way.

2:26 PM: ND TV (Rs 89.60), Zee Entertainment (Rs 121) and Sun TV Network (Rs 177) can see some sharp upmove in the near run.

Interim Budget 2009

The Lok Sabha Elections slated to be held in April - May this year will considerably boost the revenues of these media networks.

2:10 PM: HDFC Bank (Rs 914) can be retained with a stop loss at Rs 870 - 880 levels.

The stock can rise to Rs 988 and if it manages to trade firm there, can move on to Rs 1100 or even higher.

2:01 PM: Jet Airways Limited has entered into two Agreements with Oman Air for the lease out, on a Wet Lease basis, of A 330-200 Aircraft for a period of six months each, with effect from May, 2009, under the on-going route re-structuring and cost saving programme undertaken by the Company.

Wet Lease means that the operational control and maintenance responsibility remains with the Company. The aircraft remains on Indian registry and is operated with the Company's crew.

1:49 PM: Though the budget has not given any positives for the market today, one expect a trigger of sorts through a modest cut in bank rates sometime in the near future.

1:37 PM: Cement stocks Ultratech, ACC and Ambuja Cements can be retained with a medium term view.

Investors can look to buy more of these stocks at declines. The medium to long term prospects of these cement majors remain quite bright.

1:30 PM: Reliance Industries (down 4.3%), SBI (down 5.25%), ICICI Bank (down 4.4%), L&T (down 4.7%) and Bharti Airtel (down 2.3%) have gone down sharply on strong volumes today.

One looking at long term can continue to hold these stocks and look at buying more in a staggered manner at declines from current levels.

1:22 PM: Asian markets have suffered losses today. The mood back home is bearish too as the market is disappointed at not getting any positives from the interim budget.

The Sensex is deep down in the red at 9334.12 with a loss of 300.62 points or 3.12% and the Nifty is down by 92 points or 3.12% at 2856.35.

The market breadth too is very weak at present.

1:14 PM: MRO TEK Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on February 25, 2009, to consider Buy-back of Company's equity shares, at prevailing market rates, through stack exchange mechanism.

The stock is traded at Rs 24 at present. No significant upmove is expected in the near run.

1:08 PM: ONGC has signed an agreement with US oil-service provider Weatherford International Ltd. to increase production from the Indian explorer’s oil fields.

The alliance would manage oil and gas reservoirs, develop marginal oil fields and jointly explore for energy in deepwater areas.

1:00 PM: Investors with a medium or long term plan can hold Jain Irrigation Systems.

The stock, currently traded around Rs 376, can see a few weak spells in the near run, but its long term prospects remain fairly bright.

12:52 PM: One need not press the panic button as such now.

The market is likely to rally a bit over the next few sessions and one can use rallies to exit certain counters and stay tuned to the market with lesser commitments. Long term investors can hold front line capital goods, infrastructure and metal stocks with proper stop loss triggers in place.

12:45 PM: Indian Overseas Bank (Rs 58.70) can give good returns over a long run.

The stock is traded near its 52-week low of Rs 57 (touched on 5 February) at present.

One can buy more of this stock at declines from here.

12:37 PM: Geometric Ltd has informed BSE that Promoters of the Company have confirmed that none of their shareholdings in the Company are pledged as on January 28, 2009.

The Geometric Software stock, currently traded at Rs 17.60, can be retained for now with a stop loss around Rs 15.

12:31 PM: Mr Pranab Mukherjee has stated that Plan Expenditure in 2009-10 may have to be increased substantially at the time of presentation of overall budget to give economy the stimulus it needs.

12:16 PM: Fertilizer subiside has been hiked to Rs 44,863 crore from about Rs 14,000 crore in 2008 - 2009.

It is advisable to stay invested in front line fertilizers stocks like Chambal, Nagarjuna, National Fertilizers and RCF.

11:58 AM: The Parliament has been adjourned for a few minutes as Janta Dal MP Virender Kumar has fallen ill.

There have been no positive news for the market from the vote on account today.

The market has taken a long trip down south and is down by over 240 points at 9393 at present.

The Nifty is down with a loss of 69.60 points or 2.36% at 2878.75.

11:48 AM: One can use rallies to ligten commitments.

The next two or three quarters are likely to be very tough for the market.

Long term investors will get opportunities to buy front line stocks at far more attractive rates as global markets are likely to take a long time to recover.

11:35 AM: The government will continue to provide interest subsidy to farmers in financial year 2010.

This augurs well for fertilizers stocks.

11:29 AM: The minister states that IIFCL can raise 10,000 crore. And an additional Rs 30,000 crore can be raised.

60% of infra projects will be refinanced by IIFCL.

11:18 AM: Pranab says Global situation is not encouraging.

He feels the economy needs to be brought back to the 9% growth path.

11:00 AM: SAIL 9Rs 90.35) can face some resistance around Rs 100.

Short term traders can book profits there and re-enter later at declines.

Investors with a long term plan can continue to hold the stock with a stop loss around Rs 75.

10:53 AM: Rashtriya Chemicals & Fertilizers (Rs 41.30) can move up further over the next 3 - 6 months.

One can also try Nagarjuna Fertilizers, National Fertilizers, Tata Chemicals and Chambal Fertilizers for solid returns.

10:47 AM: Infosys Technologies (Rs 1245) can see some weakness in the near run.

However, investors with a long term view can continue to hold the stock with a stop loss around Rs 1050.

10:18 AM: Reliance Communications (Rs 180) can be retained for medium to long term.

One can have a stop loss around Rs 145 - 147 levels for now.

The stock can be picked up in a staggered way at declines from current levels.

10:12 AM: Jet Airways (up 2.6% at Rs 172.45) can be tried for a medium term.

The stock can rise to Rs 200 - 205 where it is likely to face some strong resistance.

A strong breakout there can result in a jump to Rs 285 - 300.

10:06 AM: Realty stocks are likely to see some upside in the near run.

But investors would do well to remain extremely selective with fresh exposure in this space.

It is advisable to keep exposure at modest levels for now.

9:57 AM: The market is off to a cautious start amid weak global cues.

On expectations of some incentives from the interim budget to be tabled today, select infrastructure, realty and auto stocks have edged higher.

The Sensex, which opened at 9637.04, is down by 59.72 points or 0.62% at 9575.02.

The Nifty is down 0.74% or 21.95 points at 2926.40.

DLF, Tata Motors and Unitech have risen sharply.

Tata Comm, BPCL, ONGC, Bharti Airtel, Nalco, Grasim, BHEL, HDFC Bank and SAIL have declined.