Pheewww!!! Finally it closed above strong resistance level of 5072. But be cautious it has exactly closed there so market can go either way!! NIFTY closed 75 points up while NIFTY future last trade was at 5097. IN-HOUSE UPDATES:-
s declared yesterday EU is planning to issue common debt instruments of EU…hope this plan work and Greece is bailed out.
“Dhak-Dhak , Dhak-Dhak”…Nope its not the previous Hero Honda advertisement it was the heart beats of the investor that i could feel during the market hours today.NIFTY opened up on the back of good US markets and then saw a fall of almost 100 points from the days high to end at 4940 almost flat just 5 points down. NIFTY future has also closed at the same point after long time.
Stock in news since last two days is TATA MOTORS..basically for 2 reasons one being the stock split from FV 10 to FV 2 and other being CEO Forster resignation on Friday on short notice. He was the key guy on the acquisition of JLR. Company official says that his resignation wont affect the JLR operation in india. NALCO (National Aluminum Company) a state-run company, operating in orrisa, is the third largest produce of aluminum had to reduce production of 6% on daily basis due to power supply cut. This is a shame to Indian government.. Dont you think?? If you just recollect before few days NHPC joined hands with Sri-lankan Ceylon Elec board to supply power…Damn, why dont you first fulfill our domestic needs??..Jaago Grahak Jaago!!! It is going to affect aluminum output up to 20000 tonnes. Stock buzz was of PIPAVAVYARD who yesterday got selected by Mazagon dock (indian govt. co.) to manufacture Indian Navy vessels. This brought stock up by 15% in just two trading session. Jai Ho Gujarat!! Gujarati’s are rocking stock market ;). MCX on another side got the approval of IPO and they are planning offstake 12.5% of their holding. To boost Infra bonds government has decreased the minimum FII limit to $5billion and lock-in period is decreased to 1 year from 3 years. Industry official said lock-in period was not the problem but the problem was 20% tax that was levied by indian government on such investment. Another such issue was that IRDA (Insurance Regulatory and Development Authority) has planned to stop giving sanction to High NAV gurantee plans because they make market to fall further as they do heavy selling when they get small profits to avoid loss. So guys dont get attracted by Plans which gurantee’s u high NAV rather invest urself. Talking about the telecom sector analyst expect that service providers will earn more as they give high devices compulsory with Data plans. But do remember Apple has been sued by CCI as they choose such bundled distribution channel and nt going through retail channels making it a monopoly. Tomorrow we have GDP and Inflation Data so guys keep a watch on it
German car maker Volkswagen’s JV with Suzuki will come to end. Suzuki was accused of using diesel engines of Fiat and they think Volkswagen is trying to advantage of their size over them. So they have offered $2.2billion for the Volkswagen stake. OPEC (Organization of Petroleum Exporting countries) has downgraded world crude demand for the next fiscal. They say world crisis will affect the crude most and demand is to decline drastically from US which is the largest pool of crude customers. They even said Demand-supply gap is about to get filled up fast as Libya’s Oil production will resume to normal by 18months,faster then expected.Yesterday Blast took place in France nuclear plant 2cd of its kind this year after Japan. US banks are expected to post 45% less profit then expected by analyst due to crisis. So avoid Banking stock if you trade in US. But yesterday we saw sharp recovery in the US markets as the news ws flooded that China is expected to buy Italian bonds which may save Europe crisis temporarily.
Today NIFTY in the morning gave a good start to cover the gap which i mentioned yesterday at 4990-5040. Now NIFTY is left with one gap around 5209-5330 which must be filled up sooner or later. MACD is still flat on daily chart without a bearish crossover so be cautious. A remarkable point to notice today was that NIFTY made a low at same point which it made yesterday making 4911 a strong support. NIFTY still has that “inverted head and Shoulder” intact.. More time it takes to built up more significant is the breakout of the pattern. So fingers crossed for the bulls. Strategy is yet to be cautious on NIFTY.
9/11 Twin tower crash anniversary was witnessed today. Friday and Monday were the victims for the crash almost 100 points each day. NIFTY closed again at a crucial level of 4946 keeping all the investors in a confused state again.
IN-HOUSE UPDATES :-
Today market was down on the back of global markets while more slide was given to our market by IIP data. IIP was expected to come around 6.1% on MoM vs 8.8% but actual was out at just 3.3%. Last time capital good sector was the best performer and this tym too but in the descending order.Capital goods output was at -15% vs 36% last months. This lead to a deep jump in the capital good stocks today. Fundamentally also we should avoid capital goods stock as it has major exposure to foreign market after IT sector. SO avoid stocks like CG, BHEL, LT etc at CMP. This friday we have a review of RBI policy and many Bond analyst expects a rate hike while many other market analyst including me feel that there will be pause in the rate hike because number is saying all. IIP data its at lowest. If further rate hike is given then growth of the country may be hampered. And growth is equally important in line with inflation. So may be RBI will press pause button. But market has already discounted the hike news and so you may see high volatility this week in the stock market. So avoid intraday trading this week. Oil India Limited (OIL) is planning to acquire blocks in africa. This move is on the report that India import 80% of its energy need and will import around 90% by next fiscal. On another hand on friday August car sales figures were out and it declined by 10% by leading market dragged by Maruti on labour issue. They have currently stopped accept bookings for New Shit variant. If you are planning to buy a car then i would advice to wait as you may get discounts on high stocks and less demand which is the current scenario of automobile industry. A government took a major step in commodity sector where they increased the export limit for rice and wheat and we may see boost in overall exports. Our overall exports for august came with an increase of 44% while imports were up by 41% but on net side we had increase in exports. A KPMG survey said that if corruption can be removed from India then we can beat GDP of china in next 2 yrs..Its nice to hear but you know that corrpution free India is not easy to achieve in such short span.
China Inflation has cooled down to some extent which is a slight relief for the markets there. Talking about the US crises now major event will be FOMC meet on 20/21 Sept. Alen Krueger, who is the chief Economist Adviser to Obama said in an interview with bloomberg that industrial output should be increase to encourage Job employement. He says Infrastructure expenses should be increased to increase over employment. Krueger report suggested that if the person has studied one grade more than his colleague then he got 16% increment in salary. Thus Obama should concentrate on improving education sector to increase the quality of employment to avoid off-shore of the IT business.
Technically market has given the close at crucial support of 4945 as i mentioned in my levels on friday. NIFTY is under the formation of downward sloping “inverted Head and Shoulder” pattern which if it gives breakout at neckline will be giving a vigorous reversal then the symmetric Head and Shoulder. MACD is almost flat but hasnt yet given a bearish crossover so market is at still on the edge. If market closed above 4927 for 2 more days then you may see some short covering .Today market opened gap down creating another gap at 4990-5060. So now we have two upward potential gaps which might be filled in near term .Strategy yet will be CAUTIOUS.