Nifty : Stats & Views

[linkon7]

The markets head towards a negative opening and likely to extend its losing momentum for the tenth straight session on account of weak global markets

Headlines for the day:

Jyothy Laboratories buys 51% in Henkel India

Ranbaxy may pay $1 billion to USFDA

Bank credit growth slows in April

Events for the day:

Major corporate action

Muthoot Finance to list today
Results: Cadila Healthcare, Central Bank of India, Federal Bank, Glaxosmithkline Pharmaceuticals, Piramal Healthcare


Pre-market report

Indian indices

The sentiments across the globe look weak, which may lead the Indian markets to begin today's session on a sluggish note. The key indices may extend the sorrow of trading in the red for the tenth consecutive session. The markets are going through a turbulent phase without a sign of direction.

Volatility maybe seen and the markets may undergo consolidation in the absence of positive factors. However, declining crude oil prices may give some respite.

Bank credit growth slows in April with interest rates ruling high; this may keep the banking shares in focus

Equity shares of Muthoot Finance will be listed on the bourses today. The issue price has fixed at Rs175 a share, at higher end of price band of Rs160-175 a share.

Daily trend of FII/MF investment in equities

The FIIs have sold Indian stocks worth a net of Rs779 crore on May 05. The domestic investors have purchased Indian shares worth a net of Rs 937 crore.

Global signals

The European markets fell on Thursday (April 05, 2011), with disappointing results weighing on banking stocks, while heavyweight mining firms tracked a pullback in commodity prices on growing uncertainty over the pace of economic recovery.

Wall Street stock indices fell for a fourth straight day on Thursday as a massive sell-off in commodities spilled over into other markets, forcing investors out of higher-risk assets and rattling equities markets before Friday's US payrolls data.

The Asian markets were trading lower on Friday (May 06, 2011), tracking declines on Wall Street following a sharp sell-off in crude oil. SGX Nifty was trading 36 points up.

Commodity cues

Crude oil prices plunged 10% to below $100 a barrel in New York on Thursday, the biggest drop since the 2008 financial crash, after a government report shook market confidence by showing a big jump in layoffs last week.

 

[linkon7]

5475 is the trend decider for the day...

 

[linkon7]

The Indian markets may begin the session on a strong note tracking positive cues from the global markets. Equity shares of Paramount Printpackaging will list today on exchanges.

Headlines for the day:

Banks may pull out over Rs60,000 cr from liquid funds

Reliance debunks charges on fall in KG-D6 output

Power Grid likely to award tower leasing contract by month-end

Events for the day:

Major corporate action

Paramount Printpackaging to list today
Aanjaneya Lifecare IPO opens today
Sanghvi Forging & Engineering IPO closes today
Results: Adani Power, Aurobindo Pharma, Indian Bank, Mundra Port


Pre-market report

Indian indices

The Indian market is likely to make a comeback this week after a sharp decline in the previous week, in light of fall in crude oil prices, markets observers to stay cautious as one should not get carried away by any short-term spike.

The sentiments across the globe look good, which may lead the Indian markets to begin today's session on a higher note. The key indices are likely to move up amid cautious sentiments.

Shares of oil marketing companies may remain in focus ahead of the scheduled meeting on May 11 to mull raising fuel prices. An increase of Rs2-2.50 per litre for diesel, Rs3 for petrol and at least Rs25 per LPG cylinder looks imminent.

Equity shares of Paramount Printpackaging will be listed on the bourses today. The issue price has fixed at Rs35 a share, at higher end of price band of Rs32-35 a share.

Daily trend of FII/MF investment in equities

The FIIs have sold Indian stocks worth a net of Rs622.90 crore on May 06, 2011 as compared to the net sell of Rs700 crore on May 05, 2011. The domestic investors have sold Indian shares worth a net of Rs211.20 crore on May 05, 2011.

Global signals

The European markets rallied on Friday (May 06, 2011) after better-than-expected April US nonfarm payroll data improved investor confidence about the recovery and fund managers tipped equities for further progress.

An unexpectedly strong report on US payrolls helped equities bounce back on Friday from four days of losses, tempering worries that stocks could suffer the sharp declines seen this week in commodities.

The Asian markets climbed in the early trades on Monday (May 09, 2011) tracking Wall Street gains, except Japanese Nikkei. SGX Nifty was trading 21.5 points higher, indicating towards a positive start on the Indian indices.

Commodity cues

Crude oil sold off for a fifth day on Friday, following a 10% crash in the previous session.

 

[linkon7]

friday's high of 5572 is very important for today... no shorts above this lvl...


5580 is the trend decider...

 

[linkon7]

rend decider for the day at 5548

 

[sumeetsj]

Not much change seen in the charts,
hence not posting any..

 

[sumeetsj]

Not much change seen in the charts,
hence not posting any..

Hence probably the best time to ride a strangle

:thumb:

 

[linkon7]

Udayan says...:

It was really the quietest of sessions. This week, three sessions have been absolutely sideways. It has gone nowhere and volumes have just kept diminishing and today they were under Rs 90,000 crore, cash plus futures. That tells you how lower the level of interest and participation has become.

So, barring a handful of stocks here and there and a bit of excitement around 3 o'clock for the market, we were trapped in a 20 point trading range for the most part of the trading day. Towards the end or by the end, some largecap movers included Ranbaxy where results were good yesterday. Hero Honda and Tata Motors in Auto. State Bank picked up a bit towards the end as well. Some of the metal names like Tisco, Sterlite, SAIL were up today. NTPC gave back some of yesterday's ground. ONGC slipped a bit as well and even Maruti did not look particularly strong in the largecap universe.

In the midcap, things were a bit better, the midcap index did well. The market breadth was positive. Future Ventures came back a bit after yesterdays disastrous listing. But the two pockets of activity were midcap IT, where companies whose names cropped up in the potential list for the large UIDAI order, names like Mastek, Mahindra Satyam etc did well. Some of the real estate names, not just DLF and large caps, but HDIL, Purvankara, DB Realty had gone up today.

SKS Microfinance remained quite firm, so continued its pullback. 3i Infotech, where talks of stake sales gain ground, was up today. United Breweries second day running spectacular gains. Divi's Lab, HOEC were some of the names from the winning list today.

On the losing side, Renuka post results and Glenmak too, both those stocks slipped off and Chambal Fertilisers too after results yesterday did not look particularly strong.

But uneventful session for the market, there was really not much to take away for this week after Friday's pullback. Maybe the markets are waiting for Friday's election results to make a more decisive move.

 

[linkon7]

so far chart looks like a pause before the storm...! low volumes and lack of participation is not helping much... fii outflow has stopped and thats the only positive...

stoch has stayed below the 20 mark for 6 sessions and thats a sign of trend continuation...

below 5445 we get to see a whole new level... and so far fingers are crossed.

 

[linkon7]

Santosh Nair

Indifference, despair and optimism—all in equal measure, and the market going nowhere. That has been the story for the past couple of months now, as conflicting news/ data flow has cost both the bulls and bears. (So much that some of the well-known market operators are said to have switched focus to the commodities market). Portfolio investors have been no better off.

Will the latest batch of state poll results make any difference one way or the other? Friday’s market rally suggests that day traders expect the electoral verdict to strengthen the Congress-led UPA coalition’s position, and give it a leeway for decisive policy action. But that line of thought appears to be a bit far fetched. Unlike in 2009, when the UPA came to power with a decisive majority, raising hopes of some path breaking economic reforms, the latest poll results are open to interpretation. On the positive side, you have one difficult ally (DMK) marginalized, and a convincing performance in Assam. But on the flip side, you have another difficult ally (Trinamool Congress) in a much stronger position, and also a dubious win in Kerala where the Congress seemed to had taken victory for granted.

Never mind the longer term implications of the poll verdict, but the market may have no recollection of it when trading resumes Monday.

For instance, in December 2008, when results of elections in five key states were announced on the same day, the BJP won three (Chhattisgarh, Madhya Pradesh and Rajasthan) key states and the Congress two (Mizoram, Delhi). Yet the market went on to rally 8% that week and 11% over the next one month. In contrast, when the Congress won all three states (Maharashtra, Haryana and Arunachal Pradesh) in October 2009, the market declined 5% that week, and rose a mere 1.3% over the next one month.

Past performance is no indicator of future direction. But the market is likely to be disappointed if it is pinning its hopes on some big bang policy announcements shortly, or on an impending cabinet reshuffle to end the ongoing policy paralysis.

There are far too many other contradictory factors in play at the moment. The higher-than-expected increase in benchmark interest rates by the RBI last month is a clear indication that the priority right now is to control inflation, even if at the cost of economic growth. And most economists are betting on rates climbing by another 50-75 basis points this financial year. March industrial output was better than expected, but March quarter earnings of most companies (Reliance, Infosys, Wipro to name a few) were not. Perhaps the performance may not have been all that bad, but they were disappointing in the context of the high valuations that the stocks enjoyed. Besides, signs of margin pressure, arising from higher input costs, were evident. And analysts expect a similar trend, if not worse, for the current quarter as well.

The sharp correction in commodity prices over the last ten days spells relief at a macro-level (lower oil bills) as well as at the micro-level (lower input costs for companies). But there lies the catch. A sustained downtrend in commodity prices could reflect a dour outlook on the growth prospects for the global economy, which in turn could shrink capital flows into risk assets like equities.

Some portfolio managers argue that economic data from the developed economies is far from cheery and so emerging economies with a better growth rate are the obvious investment destinations. But then, most emerging economies are grappling with high inflation, and unless they manage to tackle it, growth will fizzle out.

To cut a long story short, the election results—not much different from what most exit polls suggested—rattled some bears into covering their short positions, and allowed some of the bulls to cash out. But it could be anybody’s game on Monday.