Ten stocks in focus in Tuesday morning trade
(Source: Economic Times)Reliance Industries Ltd: The Andhra Pradesh High Court served notices to Mukesh Ambani-owned Reliance Industries, the Central Bureau of Investigation, Director General of Hydrocarbons and the state and union governments in response to a public interest litigation that accused Reliance of hoarding gas from the Krishna-Godavari basin.
HCL Technologies Ltd: India's fourth largest software services exporter will help UK-based government firm Student Loans Company (SLC) offer lending and payments services.
Idea Cellular Ltd: India's third largest telecom services provider Idea Cellular has partnered with publisher of digital and social games Gameloft to offer games to idea users.
Sun Pharma Ltd: Following Ranbaxy's drug recall in the US, another domestic company, Sun Pharma has recalled 2,528 bottles of its generic version of diabetes drug Glumetza.
Jet Airways Ltd: Abu Dhabi's Etihad Airways has denied violating takeover rules while buying a 24 per cent stake in Naresh Goyal's Jet Airways said media reports.
IOC: Kuwait Petroleum Corp (KPC) is in talks with Indian Oil Corp for taking a stake in the state-owned firm's Rs. 29,777-crore Paradip refinery and a proposed petrochemical complex.
Prime Focus Ltd: The technology subsidiary of post-production company, Prime Focus, has agreed to buy DAX, a California-based provider of cloud-based production workflow applications for Hollywood movies, for Rs 56 crore.
IndusInd Bank: Hinduja Group Ltd today sold 4.70 lakh shares of private sector lender IndusInd Bank to another group entity Hinduja Ventures for Rs 21.15 crore via the open market route.
STOCK VIEWS
(Views shown above are only views expressed and not a solicitation to buy or sell the stock. Please consult your financial adviser before taking any position in the stocks)
Nifty News
Indian markets are expected to trade in a range on Tuesday following muted trend seen in other Asian markets. The key support for the index is around 6,472 levels.
"The Nifty is expected to trend up till 6600 in the next couple of days. In this period the key support will be at 6472 and resistance will be at 6600," said Somil Mehta, Senior Tech Analyst (Equity) at Sharekhan.
"The Nifty has been forming higher tops and higher bottoms; it has also closed above the previous swing's high which is a positive sign for the market," he added.
Mehta is of the view that the short-term bias remains positive for a target of 6600 with reversal at 6200. The medium-term outlook remains positive as the index has started forming higher tops and higher bottoms on the weekly chart.
Pre-market: Nifty seen opening flat; may retest 6500 levels
(Source Economic Times)The 50-share Nifty index is expected to open flat on Tuesday following muted trend seen in other Asian markets. Tracking the momentum, the index is expected to retest its crucial psychological level of 6500 in
trade today.
At 07:30 a.m., Nifty India stock futures in Singapore were trading 9 points lower at 6559.50, indicating a flat-to-negative opening on the domestic market.
The BSE Sensex managed to end marginally higher on Monday after earlier posting its third consecutive record high as shares of domestic-focused companies, including HDFC BankBSE 3.23 %, extended a rally on the back of signs of strong foreign buying.
"The benchmark indices, after making sluggish start, were seen resuming the prevailing uptrend. However, the day was devoted to stock specific move with noticeable buying in cash segment," said Jayant Manglik,
President-retail distribution, Religare Securities Ltd.
"Consistent buying from FIIs in last two weeks is also boosting the investors' sentiments. In last five sessions, Nifty has gained more than five percent and almost on the verge of touching the major hurdle at 6600," he added.
Hence, we can't ignore the possibility of profit taking in near future, says Manglik.
Technically, the upside momentum in Nifty would continue to remain intact as long as 6400 is held as a support in the coming sessions.
"If any correction is seen then it has immediate support in the range of 6500 to 6460 and below that 6400 is the next support level to watch out for," GEPL Capital said in a report. "Traders may buy on decline placing a stop loss of 6350 for an upside till 6700 in coming weeks," added the report.
Overnight, US stocks ended lower weighed down by soft data out of China and Boeing's latest production setback.
"China's exports unexpectedly tumbled 18.1 percent in February, against expectations for a 6.8 percent rise, swinging the trade balance into deficit and adding to fears of a slowdown in the world's second-largest
economy," Reuters said in a report.
The Dow Jones industrial average fell 34.04 points or 0.21 percent, to 16,418.68, the S&P 500 lost 0.87 points or 0.05 percent, to 1,877.17 and the Nasdaq Composite dropped 1.775 points or 0.04 percent, to
4,334.448.
Asian markets were trading mixed as worries about China's economy continue to reverberate, taking a particularly hard toll on commodity prices.
"Investors will be nervously watching Chinese money markets and the yuan for any evidence the People's Bank of China (PBOC) is engineering an easing in monetary conditions after it forced the currency sharply
lower on Monday," added the Reuters report.
F&O Tracker: Breaching 6700 looks tough in expiry phase
(Source: EConomic Times)By Hemant Nahata, IIFL
The recent rally has been driven by gush of hot money as FIIs have been net buyer in cash, index futures as well as stock futures on last two days. The participant-wise OI data indicate FIIs long/short ratio on index currently stands at ~5.5x. FIIs' total long contracts on index futures stand close to 3.6 lakh (maximum at ~5.0 lakh contract) and total short index position at 65K (minimum being ~50K). The Nifty has breached previous highs, scaling up 550 points in the last 25 days on relentless buying from FIIs. The rally has been led by beaten-down banking, capital goods and reality stocks. Oil & gas heavyweights Reliance and ONGC have been the pillars of this rally
Open interest on index futures at aggregate level currently stands at 2.07 crore shares, lower than the 3-month average 2.2 crore shares. Call writing has not been aggressive for the March series; however, put options have seen lots of OI additions, which could be a mix of a directional trade and hedge against recent cash buying. IVs have spiked recently from sub 14 levels to 16.5 levels in the past three trading sessions. The cost of carry for Nifty has gone up to 0.46 as against 0.12 levels during the start of the expiry. The Current PCR OI stands at 1.17x, giving confirmation that appropriate hedge has been taken. Going by the current data, we believe it would be tough for the Nifty to break 6700 during the current expiry even as every dip till 6380-6400 would be used as a buying opportunity by traders in the near term.
Nifty in a sweet spot to hit 7000; hold on to long positions
(Source: Economic Times)By Siddarth Bhamre
If you thought that the market run is over and it may at least consolidate, if not correct, then you may have to eat your words soon.
Last week, we mentioned that the markets have some resistance around 6280-6350 levels and there may be some dips which should be bought and that dip was around 50-60 points. Also, we have been advocating holding on to long positions and after this great upside week, we still continue to mention that hold on to your long positions.
Look at the monthly charts. That will clearly show that this is a multi-year breakout. Off course then it will be a breakout on weekly as well as daily charts. Give attention to the volumes in weekly chart, this breakout is on very strong volumes.
If we take the move from 30 Aug-2013 to 13 Dec-13, in which the market rallied from lows of 5120 to 6400, as an impulse wave and later correction to lows of 5935 on weekending on 07-Feb-14. its retracement of 38% of impulse move.
Now if we take from these lows, the second impulse move which is 100% of first impulse, then we are getting the targets which are much higher than the 7000 levels on the Nifty.
Well, that may or may not happen, but one thing which is clear at this juncture is the markets are in a sweet spot and this momentum may continue without any meaningful dips. So to reiterate, hold on to long positions and don't wait for any dip as that may not come.
Bank Nifty last week was taking resistance just below 200 DMA and has not zoomed past it, but is still well below its all-time high. However, this does not make it any weaker candidate than the Nifty. Here too the momentum may continue.
(The author is Head - Equity Derivatives and Technicals, Angel Broking. The views and recommendations expressed in this section are his own and do not represent those of EconomicTimes.com)
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