Indian Stock Markets BSE, NSE Weekly review 08 Mar 2010

Colour and festivities continued during the Holi-day truncated week as the euphoria post-budget took the indices to over two-month highs. An improvement for India's merchandise exports for the third consecutive month spurred the sentiments of traders on Dalal Street.

Continuous buying by foreign institutions and robust monthly auto and cement numbers added reasons for the Street to rejoice. Finally, the BSE Sensex added 3.4% to end at 16,994 and NSE Nifty surged 3.4% to end at 5,089.

The BSE Sensex hit an intra-week high of 17,098 and low of 16,524 while, NSE Nifty hit intra-week high of 5,119 and low of 4,935.

The top gainers: The top gainers in the Sensex were Tata Motors (up 11.7%), Tata Power (up 9.7%), Tata Steel (up 7.6%), Bharti Airtel (up 6.8%) and DLF (up 6.1%).

The Top Losers: The top losers in the Sensex were ONGC (down 2.1%), Ranbaxy Labs (down 0.3%) and Maruti Suzuki (down 0.2%).

The BSE IT Index (up 1.1%): The top gainers in the IT sector were Sasken Communication (up 7.8%), Mahindra Satyam (up 4.8%), Patni Computer (up 3.5%), Oracle Financial (up 3.4%) and Financial Tech (up 3.1%).

HCL Tech fell 2.2% during the week.

The BSE Consumer Index: The top gainers in the consumer durables sector were Samtel Color (up 9.9%), Whirlpool (up 8.7%), Videocon Industries (up 6.7%), Mirc Electronics (up 5%) and Titan (up 4.8%).

The BSE Healthcare Index (up 2.8%): The top gainers in the Pharma space were Strides Arcolab (up 9%), Panacea Biotec (up 7.2%), Aurobindo Pharma (up 7%), Wockhardt (up 6.7%) and IPCA Labs (up 6.5%).

The BSE Banking Index (up 3.8%): The top gainers in the banking space were Karnataka Bank (up 14.4%), OBC (up 12.7%), Canara Bank (up 9.4%), Union Bank of India (up 8.3%) and Kotak Mahindra Bank (up 7.7%).

The top loser was Axis Bank during the week. The stock fell 1.9%.

The BSE Auto Index (up 5.3%): The top gainers in the auto space were Hindustan Motors (up 14%), Tata Motors (up 11.7%), Ashok Leyland (up 10.2%), Eicher Motors (up 8.1%) and M&M (up 6.8%).

Shares of Maruti Suzuki marginally slipped 0.2% during the week.

The BSE Oil & Gas Index (up 2%): The top gainers in the oil & gas space were Gujarat NRE Coke (up 20.2%), GSPL (up 9.5%), Hindustan Oil (up 8.5%), Essar Oil (up 6.5%) and MRPL (up 5.8%).

The top losers in the oil & gas space were BPCL (down 4.2%), IOC (down 3.3%), ONGC (down 2.1%), HPCL (down 1.8%) and Chennai Petroleum (down 1.4%).

The BSE Capital Goods Index (up 3%): The top gainers in the capital goods space were Kirloskar Brothers (up 13%), Areva T&D (up 8.5%), ELGI Equipments (up 8.1%), Thermax (up 7.2%) and Praj Industries (up 6.9%).

The Cement Sector: The top gainers in the cement sector were JK Cements (up 9.9%), Prism Cement (up 8.9%), Binani Indus (up 8.8%), India Cements (up 7.8%) and Madras Cements (up 7.5%) and Grasim (up 4.4%).

The Telecom Sector: The top gainers in the telecom space were Wire and Wireless (up 7.4%), Shyam Telecom (up 7.2%), Bharti Airtel (up 6.8%), Tata Teleservice (up 5.2%) and MTNL (up 4.9%).

The Realty Sector (up 7%): The top gainers in the real estate space were Akruti City (up 9.1%), Sobha Developers (up 8.9%), Unitech (up 7.9%), Ansal Props (up 7.8%), HDIL (up 6.5%) and DLF (up 6%).

Peninsula Land slipped 3.6% during the week.

The Metals sector (up 7.1%): The top gainers in the metals sector were Adhunik Metaliks (up 13.2%), Tata Metaliks (up 12.9%), JSW Steel (up 11.7%), Jindal Steel (up 10.1%) and Bhushan Steel (up 8.9%).

Source - Indiainfoline

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Market Khabar 8 March 2010

Buoyed by better than expected economic reports, positive vibes from the Union Budget and benign global cues markets posted their best weekly gains in 2010 during the week ended.

On the BSE the Sensex gained 565 points to end just below 17K mark at 16,994 and the Nifty on the NSE was up 166 points closing at 5,089. Strong breadth can be seen by the out performance of the midcap and smallcap indices. Momentum is back feel traders.

FII buying of $791 million of Indian equities in the last three sessions is clear sign of renewed interest. However, it is pertinent to note that domestic institutions have been big sellers in the last few sessions. After the lukewarm response to FPO’s of NTPC and REC, response to NMDC offering may become “trend changer”. Barring any unexpected “nasty” news from the global front, markets may trend upwards in near term till the next big triggers — RBI Credit policy and Q4 results season.

Watch updates on advance tax numbers for trading ideas. Keep an eye on the upcoming IIP Data and monthly inflation data. For the week ahead chartists predict trading range of 16,800-17,600 for the Sensex and 5,010-5,260 for the Nifty. If markets gain “momentum” new short term highs are not ruled out. Immediate supports for the indices are at 16,800 and 16,560, 5,020 and 4,880.

Markets change continuously and so must traders. What worked last year, or last month may not work today. Change thinking and tactics to respond to the market’s changing.

Futures & Options

Mirroring the strong undercurrent in the cash market, brisk trading volumes were seen in the derivative segment. Open interest has again crossed Rs1 lakh crore mark. Sentiment indicators like open interest, implied volatility, put/call ratio and VIX indicate reduced volatility and continuation of the ongoing uptrend.

Option activity in index options shows huge accumulation of options at 5,100 and 5,200 strikes. Crossing of 5,200 level may see Nifty make very sharp upmove. Metals, banking, realty, cement and auto stocks were in limelight.

Good dispatch numbers and hike in prices sparked buying in cement counters. Stocks to cement their recent gains in days ahead, buy on declines ACC, Ultratech, Birla Corp, India Cement and Ambuja Cement. Auto stocks have run up too fast for comfort say industry watchers. Wait for correction to buy. Buy on declines.

True to predictions banking counters led by biggie SBI are back in limelight. Buy smaller PSU banks like Vijaya Bank, Dena Bank and others for benefits accruing from recent budget moves. Among the stock futures “new” additions BGR Energy, Onmobile, Jain Irrigation and Fortis are witnessing good trader interest. Buy on declines BGR Energy for surprising gains. PSU counters Power Grid, Petronet LNG and GSPL may show sharp upmove.

Infrastructure counters may see renewed buying interest over the next few weeks. Stay invested for present. With NASDAQ at 18-month high, IT stocks are expected to attract buying from foreign funds at lower levels.

For the trader or investor, discipline means to exercise good and prudent money management and risk management.

Activity in newly listed counters like ARSS Infra and Jubilant Foods clearly indicates that “story” telling is back in vogue.

Delivery volumes clearly indicate that operators are back at work in connivance with some funds. Next counter on radar is Hathway. Be cautious while dabbling in the hyped counters.

Savvy fund managers are buying eClerx Services, M&M Financial, Cholamandalam DBS and Raymond say market watchers. eClerx offers services in data analytics, operations management, data audit and metrics management.

Good growth numbers spell bright future for next few quarters. Buy on declines for price target of Rs750.

Expectedly strong rumours are doing rounds that M&M group will try to acquire banking license through M&M Financial.

Use corrections to buy. Raymond has finalised plans for restructuring and also to “unlock” land value. Market watchers and analysts tip the target of Rs350 in the medium term.

Cholamandalam DBS is reinventing itself and is now aggressively eyeing the banking space. Buy on declines for the target price of Rs125.

Midcap counters such as Dalmia Cements, Ess Dee Aluminum, Blue Dart Express, Core Projects and Zuari Inds are tipped for further gains from the current levels.

Firmness on the part of the government to not rollback fuel prices may trigger mild rally in PSU oil marketing counters and may also affect private refiners such as Essar Oil.

Watch out for this sector for sharp swings.

C. Kutumba Rao is a Hyderabad-based stock market analyst. The views expressed and the recommendations made are those of the author. Readers are strongly recommended to consult their financial advisors before making any financial investments. This newspaper is not liable for investment decisions made on the basis of recommendations in these columns.

Source : DC

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Market Khabar 3 March 2010

After moving in a narrow range for the most part of the week, markets gave a thumbs up to Budget and ended on an optimistic note during the week ended.

On the BSE, the Sensex added 1.5 per cent to close at 16,430 and the Nifty on the NSE gained 1.6 per cent to end at 4,922. Volumes remained robust through the week and spiked sharply higher in the budget session. Intraday cut in the gains at the fag end of the budget day has been attributed to some “devils” in the fine print of the budget. Sceptics warn that vision statements like higher GDP curve of 10 per cent and deficit curve of four per cent are for the consumption of FIIs. However, optimists say that market is unlikely to face any unpleasant policy changes in medium term since the government needs a buoyant stock market to meet its disinvestment targets. Any rollback of proposals like fuel price hike may dampen the sentiment. Despite no negatives in the Budget, excessive exuberance is not warranted, caution old timers.

Focus of the markets will now shift to upcoming credit policy, Q4 earnings season and monsoon predictions. For the week ahead, chartists predict trading range of 16,060-16,840 for the Sensex and 4,780-5,060 for the Nifty.

Expect strong resistance to the indices at 16,660 and 16,800 and 4,990 and 5,060. Immediate supports for the indices are at 16,280 and 15,940 and 4,860 and 4,780. With the Budget out of the way, it is back to watching global markets. The search for next Greece is already on; stay tuned for unexpected nasty surprises.

Futures & Options

Despite being settlement week and laced with the Budget, robust trading volumes were seen in the derivative segment. Overall rollover of 84 per cent as against three months average of 85 per cent was seen.

Sentiment indicators like open interest, put/call ratio, implied volatility and VIX indicate heightened volatility in near-term. Option activity in Nifty clearly indicates strong resistance at 5,000-5,100 and good support between 4,700-4,800 levels.

Recapitalisation proposals in the Budget are positive for PSU banks such as IDBI, Union Bank, Syndicate Bank, Dena Bank and other banks with tier-1 ratio of less than eight per cent. Use present weakness to accumulate bank stocks for the medium term. Higher allocations for construction and infrastructure spell good times for large infra players such as HCC, GVK Power, Lanco Infra and others. Stay invested for present. Avoid cement, IT and FMCG for present till the budget dust settles down.

Use sharp corrections to buy IT majors like Infosys, Wipro and TCS. Impacts of budget proposals on auto and auto components to be neutral say industry experts. With recall issues plaguing auto companies across the world, range bound activity indicated in auto counters in near term.

Ahead of 3G auctions, telecom stocks may rebo-und from current levels. Gutsy traders can buy Bharti, Idea and Tata Communications at current levels. Metal stocks are back in limelight on reports of firm international trends and domestic demand. Buy on declines Tata Steel, SAIL, Hindalco, Nalco and Sterlite. Announcement of split of Nalco divisions likely in near term, say sources.

Stock scan

At a time when the repercussions of recent global financial crises are still being felt and the attendant focus on shoring up the capital base of existing players with tighter supervision is there, budget proposals regarding new banking licenses to private sector including non-banking finance companies have been a big ‘surprise’ to the sector. Among those with ambitions of setting up a bank are ADAG Group (Reliance Capital), Tatas (Tata Capital), Aditya Birla Group and the TVS Group (Sundaram Finance). From the new age NBFCs like IndiaBulls, Religare and Edelweiss may also be inte-rested. Keep close watch on the sector.
Green budget has put focus on the stocks of renewable energy sector. Clean energy cess on coal and reduced duties for equipment required for setting up solar photovoltaic and wind energy units clearly reflect the renewed focus on the sector to tackle climate change. Stocks like Suzlon Energy, Moser Baer, Websol Energy and many smaller firms, which are moving into the sector may hog limelight in coming months. Fly by night promoters may use the same old game of ‘name change’ marking entry into this sunrise sector and exploit the market fancy for the sector. Discriminate between good and bad.
Food processing sector has been offered a slew of concessions in the budget. With agriculture retail business going organised with the entry of big players like ITC, Bharti, Reliance and smaller ones like REI Agro, the sector is poised for big take off. Keep watch on companies that may provide capital goods for the sector and also on agri stocks like Jain Irrigation and others.

C. Kutumba Rao is a Hyderabad-based stock market analyst. The views expressed and the recommendations made are those of the author. Readers are strongly recommended to consult their financial advisors before making any financial investments. This newspaper is not liable for investment decisions made on the basis of recommendations in these columns.

Source DC

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Buy ITC below 200

Company: ITC
Broking House: UBS
Rating: Buy Price Target: Rs 300

Prima facie, the union bud-get is negative for cigerette maker ITC because of the hike in duties, says UBS in a post budget note on the company. The increase in excise duties is higher than expectations, the note says. However, other measures announced in the budget — including tax incentives for the hotel industry, will be positive for the firm. This will push up ITC’s bottomline for FY11 as the company is also completing a large hotel during the year. UBS has kept its buy rating on the company, but to account for the worsening margin picture on the cigerette front, it has cut down the price target from Rs 325 earlier.

Readers are recommended to consult their financial advisers before making any investment. This newspaper is not liable for investment decisions made on the basis of recommendations in these columns.

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Buy Ranbaxy

Company: Ranbaxy
Broking House: Morgan Stanley
Rating: Overweight Price Target: Rs 549

Excluding the one time items, Ranbaxy has reported Q4 results broadly in line with expectations, says Morgan Stanley. For the coming year, the company plans to benefit from its exclusivity pipeline. Exclusivity allows the company to be the only generic supplier of a drug that’s coming off patent for six months. For a best selling drug, the rights could be worth several million dollars. The company’s guidance of a net profit of Rs 460 crore seems to be too low. While there are uncertainties clouding the firm’s outlook, given the exclusivity pipeline, the brokerage has kept its overweight rating on the stock.

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Buy Tata Motors

Company: Tata Motors
Broking House: JP Morgan
Rating: Overweight Price Target: Rs 825

The consolidated results of Tata Motors were a positive surprise, says JP Morgan in its note. The reported profit of Rs 650 crore was driven by improved performance of JLR, which recorded a profit of £55 million. JLR saw a total volume of 56,700 during December quarter versus sale of 44,300 units for the September quarter. The management too has given a positive outlook for the year, guided by the recovery in volumes and the soon to be launched premium Jaguar XJ. JP Morgan has retained its overweight rating on the company as it expects better volume domestically and internationally. The brokerage also expects a sharp impro-vement in cash flows and the gearing for the firm.

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Buy Tata Chemicals

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Buy Shree Cement

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Buy Rolta India

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Buy RCF

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Buy Piramal Health

Buy Pidilite Industries

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Buy Pantaloon Retail

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Buy McLeod Russel

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Buy LIC Housing

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Buy LMW

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Buy Kirloskar Brothers

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Buy Jet Airways

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Buy Jain Irrigation

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Buy IVRCL Infra

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