STOCK IN NEWS:
BPCL, HPCL & IOC: The Oil Ministry has put on hold further diesel price increases, citing a reason that had not prevented it from hiking rates uninhibitedly about a year ago. The Cabinet had in January last year decided that diesel prices should be raised by 40-50 paise a litre every month until losses on the fuel are wiped out,
United Spirits Ltd: Leading bourse National Stock Exchange (NSE) has given its approval to Vijay Mallya-led United Spirits' proposal for transfer of a distillery in Tamil Nadu to Enrica Enterprises.
SpiceJet & Jet Airways Ltd: Jet fuel or ATF price was today cut by 4 per cent and rates of non-subsidised cooking gas (LPG) by Rs 100 per cylinder, reflecting global trends.
Coal India Ltd: State-owned Coal India(CIL) has tweaked the provision of calculating the compensation and incentive under fuel supply agreements models for the non-power consumers like cement, iron and steel.
Reliance Power Ltd: Reliance Power said its 600 MW coal-based power plant at Butibori in Maharashtra is fully operational.
Axis Bank Ltd: The Reserve Bank of India (RBI) said that foreign institutional investors will not be allowed to buy additional shares in Axis Bank Ltd as the total holding by the investors had breached the overall limit of 49 percent of the lender's paid-up capital.
South Indian Bank: The Reserve Bank restricted purchase of shares in South Indian Bank by foreign investors as the prescribed limit reached the trigger level.RBI said the foreign shareholding through Foreign Institutional Investors, NRIs, PIO, Foreign Direct Investment, Global Depository Receipts has reached the trigger limit.
United Spirits Ltd: Leading bourse National Stock Exchange (NSE) has given its approval to Vijay Mallya-led United Spirits' proposal for transfer of a distillery in Tamil Nadu to Enrica Enterprises.
SpiceJet & Jet Airways Ltd: Jet fuel or ATF price was today cut by 4 per cent and rates of non-subsidised cooking gas (LPG) by Rs 100 per cylinder, reflecting global trends.
Coal India Ltd: State-owned Coal India(CIL) has tweaked the provision of calculating the compensation and incentive under fuel supply agreements models for the non-power consumers like cement, iron and steel.
Axis Bank Ltd: The Reserve Bank of India (RBI) said that foreign institutional investors will not be allowed to buy additional shares in Axis Bank Ltd as the total holding by the investors had breached the overall limit of 49 percent of the lender's paid-up capital.
South Indian Bank: The Reserve Bank restricted purchase of shares in South Indian Bank by foreign investors as the prescribed limit reached the trigger level.RBI said the foreign shareholding through Foreign Institutional Investors, NRIs, PIO, Foreign Direct Investment, Global Depository Receipts has reached the trigger limit.
NIFTY NEWS:
Indian markets are expected to trade in a range on Wednesday following positive trend seen in other Asian markets. The key support for the index is around 6,689 levels.
"The Nifty is expected to trend up till 6770 in the next couple of days. In this period the key support will be at 6689 and resistance will be at 6730," 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. The short-term bias remains positive for a target of 6770 with reversal at 6470," he added.
Mehta is of the view that the medium-term outlook remains positive as the index has started forming higher tops and higher bottoms on the weekly chart and the momentum indicator has given a positive cross-over.
"The Nifty is expected to trend up till 6770 in the next couple of days. In this period the key support will be at 6689 and resistance will be at 6730," 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. The short-term bias remains positive for a target of 6770 with reversal at 6470," he added.
Mehta is of the view that the medium-term outlook remains positive as the index has started forming higher tops and higher bottoms on the weekly chart and the momentum indicator has given a positive cross-over.
Pre-market: Nifty seen opening higher; may hit 6750 levels
The 50-share Nifty index is expected to open higher on Wednesday following positive trend seen in other Asian markets. Tracking the momentum, the index is expected to hit its crucial level of 6750 in trade today.
At 07:30 a.m., Nifty India stock futures in Singapore were trading 55 point higher at 6776.50, indicating a higher opening on the domestic market.
At 07:30 a.m., Nifty India stock futures in Singapore were trading 55 point higher at 6776.50, indicating a higher opening on the domestic market.
Despite intraday volatility, benchmark indices managed to close at a record high on Tuesday supported by gains in technology, oil & gas and pharmaceuticals stocks.
However, rate sensitive stocks ended in the red even as the Reserve Bank of India (RBI) maintained status quo on interest rates. The RBI has left repo rate at 8 per cent, reverse repo rate at 7 per cent and CRR at 4 per cent.
However, rate sensitive stocks ended in the red even as the Reserve Bank of India (RBI) maintained status quo on interest rates. The RBI has left repo rate at 8 per cent, reverse repo rate at 7 per cent and CRR at 4 per cent.
Nifty remained highly range bound throughout the session and finally concluded the day with a gain of 16 points at 6721. In the coming few sessions as long as it trades above the level of 6640 there may be an attempt to scale higher till 6770 to 6775 range which is a very stiff resistance on a positional basis, say analysts.
"If over the next couple of sessions Nifty is not able to clear 6775 and breaches the level of 6640 then there is a likelihood of a pause to the current rally," GEPL Capital said in a report.
"Intraday support levels are placed at 6685 and below that at 6640 whereas intraday resistance level is placed at 6775 and beyond that at 6800," added the report.
Overnight, US stocks rose for a third straight session with the S&P 500 ending at a record close, after positive data on factory activity indicated economic growth was gaining traction following a harsh winter.
"The Institute for Supply Management (ISM) said its index of national factory activity rose to 53.7 in March, its second straight monthly acceleration. However, the report was below the median forecast of 54.0," Reuters reported.
The Dow Jones industrial average was up 74.95 points, or 0.46 percent, at 16,532.61. The Standard & Poor's 500 Index was up 13.18 points, or 0.70 percent, at 1,885.52. The Nasdaq Composite Index was up 69.05 points, or 1.64 percent, at 4,268.04.
The March F&O series ended on a positive note with Nifty futures gaining around 7% and with the strong base of open interest to start with the April series which was seen at 1.71 crore compared with previous month's 1.45 crore as rollovers. The rollover cost was also better at 0.62% compared with its three months average of 0.50%, suggesting long bets played for the April series. FIIs also had a healthy participation in the last series, as they infused around Rs 6,025 crore in index futures with consistent increase in the open interest and cash segment; they bought to the tune of Rs 20,000 crore odd. The start of the April series is also seen with a positive bias, where Nifty futures is trading sideways at its higher end, above the 6,700 psychological mark.
Over the last one month, Infosys fell to Rs 3,314 from Rs 3,820 and Tata Consultancy Services slipped to Rs 2,172 from Rs 2,272. The CNX IT index to down 8.9%, while technology funds category has fallen 9.2% during the same period.
However, experts say the fears are exaggerated and investors should use the correction to accumulate IT stocks with two to three-year time frame. " Nasscom, the industry body, has given higher growth guidance for 2014-15 at 13-15%. With the business environment showing improvement in the US and Europe, the main export markets, Indian IT companies should record higher volume growth," says Mrinal Singh, fund manager, ICICI Prudential Mutual Fund.
Valuations of IT companies have also turned attractive after the recent beating, say experts. "Given the fact that the sector could record a 15% volume growth, valuations look attractive," says Alok Ranjan, portfolio manager, Way2Wealth. Large cap companies like Infosys are trading at a P/E of 19.45, while Wipro is available at a P/E of 20.88 and HCL TechBSE 1.99 % is available at a P/E of 20.21. He feels Infosys' lower guidance is only for this quarter and company specific, and it does not reflect the fortunes of the industry for the next year. "Investors looking for a contrarian sector in their portfolio as well as exposure to overseas markets could invest a small amount in IT funds," says Vishal Dhawan, founder, Plan Ahead Wealth Advisors.
"If over the next couple of sessions Nifty is not able to clear 6775 and breaches the level of 6640 then there is a likelihood of a pause to the current rally," GEPL Capital said in a report.
"Intraday support levels are placed at 6685 and below that at 6640 whereas intraday resistance level is placed at 6775 and beyond that at 6800," added the report.
Overnight, US stocks rose for a third straight session with the S&P 500 ending at a record close, after positive data on factory activity indicated economic growth was gaining traction following a harsh winter.
"The Institute for Supply Management (ISM) said its index of national factory activity rose to 53.7 in March, its second straight monthly acceleration. However, the report was below the median forecast of 54.0," Reuters reported.
The Dow Jones industrial average was up 74.95 points, or 0.46 percent, at 16,532.61. The Standard & Poor's 500 Index was up 13.18 points, or 0.70 percent, at 1,885.52. The Nasdaq Composite Index was up 69.05 points, or 1.64 percent, at 4,268.04.
Asian markets were trading higher with Nikke gaining over 1 per cent in trade thanks to the drop in the yen. However, trading was cautious ahead of Thursday's meeting of the European Central Bank and Friday's U.S. jobs numbers, both of which could move markets in major ways.
U.S. crude was off 7 cents at $99.67 a barrel in early trade.
Japan's Nikkei 225 index was trading 1.5 per cent higher at 15,015.50 and Hong Kong's Hang Seng index was trading 0.10 per cent higher at 22,470.12.
South Korea's Kospi index was trading 0.2 per cent higher at 1,996. China's Shanghai index was trading flat at 2,047.
U.S. crude was off 7 cents at $99.67 a barrel in early trade.
Japan's Nikkei 225 index was trading 1.5 per cent higher at 15,015.50 and Hong Kong's Hang Seng index was trading 0.10 per cent higher at 22,470.12.
South Korea's Kospi index was trading 0.2 per cent higher at 1,996. China's Shanghai index was trading flat at 2,047.
F&O tracker: Tempo can pick up above 6,770 levels
By Ashish Chaturmohta, Fortune Group
The March F&O series ended on a positive note with Nifty futures gaining around 7% and with the strong base of open interest to start with the April series which was seen at 1.71 crore compared with previous month's 1.45 crore as rollovers. The rollover cost was also better at 0.62% compared with its three months average of 0.50%, suggesting long bets played for the April series. FIIs also had a healthy participation in the last series, as they infused around Rs 6,025 crore in index futures with consistent increase in the open interest and cash segment; they bought to the tune of Rs 20,000 crore odd. The start of the April series is also seen with a positive bias, where Nifty futures is trading sideways at its higher end, above the 6,700 psychological mark.
The Put-Call Ratio open interest of Nifty futures witnessed a drop from 1.20 to 0.83 during March expiry, as heavy short positions on the put side were built in the March contract. However, since the start of the April series, it has seen a steady move towards 0.94 odd levels, as put writers are seen active at OTM strike prices. The maximum OI concentration is seen at 6,600 strike price for put option, indicating an important support, whereas for the call option it has showed a shift from 6,700 to 6,800 strike price, as the index futures continues to hold above the 6,700 mark, pushing the writers to higher side in anticipation of the Nifty to remain below 6,800 levels.
Technically, Nifty futures holds immediate support at 6,680 levels. Till it holds above 6,680, trend for the market will remain sideways to positive where momentum can pick up above 6,770 levels on a sustained basis. However, sustaining below 6,680 levels, we may see profit booking in the market. Tata Steel, A Pharma, Ambuja Cement and M&M look positive and may outperform the market.
Technically, Nifty futures holds immediate support at 6,680 levels. Till it holds above 6,680, trend for the market will remain sideways to positive where momentum can pick up above 6,770 levels on a sustained basis. However, sustaining below 6,680 levels, we may see profit booking in the market. Tata Steel, A Pharma, Ambuja Cement and M&M look positive and may outperform the market.
Investors can use correction to buy in to technology stocks
Technology stocks have been badly battered in the market since last month after a lower guidance from Infosys for the last quarter of the financial year, along with fears of a likely robust rupee, after the elections, eating into the margins of IT companies.Over the last one month, Infosys fell to Rs 3,314 from Rs 3,820 and Tata Consultancy Services slipped to Rs 2,172 from Rs 2,272. The CNX IT index to down 8.9%, while technology funds category has fallen 9.2% during the same period.
However, experts say the fears are exaggerated and investors should use the correction to accumulate IT stocks with two to three-year time frame. " Nasscom, the industry body, has given higher growth guidance for 2014-15 at 13-15%. With the business environment showing improvement in the US and Europe, the main export markets, Indian IT companies should record higher volume growth," says Mrinal Singh, fund manager, ICICI Prudential Mutual Fund.
Valuations of IT companies have also turned attractive after the recent beating, say experts. "Given the fact that the sector could record a 15% volume growth, valuations look attractive," says Alok Ranjan, portfolio manager, Way2Wealth. Large cap companies like Infosys are trading at a P/E of 19.45, while Wipro is available at a P/E of 20.88 and HCL TechBSE 1.99 % is available at a P/E of 20.21. He feels Infosys' lower guidance is only for this quarter and company specific, and it does not reflect the fortunes of the industry for the next year. "Investors looking for a contrarian sector in their portfolio as well as exposure to overseas markets could invest a small amount in IT funds," says Vishal Dhawan, founder, Plan Ahead Wealth Advisors.
For the quarter ended December 31, 2013, the US economy grew at 2.6% against analysts' expectation of 2.4%. Initial jobless claims in the US decreased to 3,11,000 in the week ended March 22 from 3,21,000 in the week ended March 15, a four-month low. This makes them confident of the growth in the US markets.
Also, the development of new SMAC (social, mobility, analytics, and cloud) technologies will further drive IT spends from companies in the coming years.
Also, the development of new SMAC (social, mobility, analytics, and cloud) technologies will further drive IT spends from companies in the coming years.
"Right now, these technologies are at a nascent stage and could be a substantial part of Indian IT companies portfolio in the coming years," says Ranjan. Among individual stocks, he recommends large-cap IT stocks such as TCS.
WILL RUPEE PLAY SPOILSPORT?
Since IT firms get more than half their earnings from overseas markets, direction of the rupee is significant to analysts. The rupee has appreciated to 59.91 against the US dollar from levels of 62 in the last one month on expectations that a stable government at the Centre will attract large foreign inflow.
However, experts believe that there is limited room for a sharp appreciation. For one, high crude oil imports would constantly put pressure on the rupee. As per ministry of petroleum, crude oil imports have gone up from 962.7 lakh tonnes in 2005 to 1,841.73 lakh tonnes in 2012-13, a rise of 91.3% in the last eight years.
WILL RUPEE PLAY SPOILSPORT?
Since IT firms get more than half their earnings from overseas markets, direction of the rupee is significant to analysts. The rupee has appreciated to 59.91 against the US dollar from levels of 62 in the last one month on expectations that a stable government at the Centre will attract large foreign inflow.
However, experts believe that there is limited room for a sharp appreciation. For one, high crude oil imports would constantly put pressure on the rupee. As per ministry of petroleum, crude oil imports have gone up from 962.7 lakh tonnes in 2005 to 1,841.73 lakh tonnes in 2012-13, a rise of 91.3% in the last eight years.
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