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WealthRays Securities Source Name: WealthRays Securities

Comments on the Market by Mr. Kiran Kumar Kavikondala, Director & CEO, WealthRays Securities

Oct 13, 2014   16:21 IST 
India

Synopsis:

Indian equity markets opened lower tracking negative cues from global markets. Sell off was witnessed on Wall Streeton Friday which caused Nifty to open lower by 28.95 points. European markets also opened in red but erased losses and made a recovery with FTSE trading flat. Pharma stocks were top losers on Nifty dragging the benchmark while Banking and IT stocks lifted the index. Nifty erased early losses and recovered from day’s low of 7796 and touched 7900. IndusInd bank came up with a better than expected Q2 result and touched life time high. Reliance results were awaited along with major CPI data. Nifty closed at 7884.25 holding 7850 mark.

 

Indian Markets

Indian equity markets opened lower tracking negative cues from global markets. Sell off was witnessed on Wall Streeton Friday which caused Nifty to open lower by 28.95 points. European markets also opened in red but erased losses and made a recovery with FTSE trading flat. Pharma stocks were top losers on Nifty dragging the benchmark while Banking and IT stocks lifted the index. Nifty erased early losses and recovered from day’s low of 7796 and touched 7900. IndusInd bank came up with a better than expected Q2 result and touched life time high. Reliance results were awaited along with major CPI data. Nifty closed at 7884.25 holding 7850 mark.

 

USDINR pair opened 10 paisa lower and remained in a narrow range ahead of inflation data. GOI ten year yields fell 0.21 % ahead of CPI. Asian currencies were mixed to strong against USD. Strength in equity markets supported the Rupee and restricted depreciation. USD index traded down by 0.38% suggesting a pause in up move of USD. Rupee is expected to remain in range of 61.00-61.50. FII flows in equity markets as Q2 earning seasons starts will be in focus for further cues on USDINR.

 

Other Asian Markets

Major Asian Indices closed with a negative bias on worries of slowdown in China. Nikkei was closed on account of holiday. China’s exports rose 15.3% against estimates of 11.8% but still investors remained cautious as the PBOC said prudent monetary policy will be continued for a while. SSE closed down by 0.36%. HSI closed up by 0.24%.

 

Commodity Outlook:

Commodity Market was very volatile in the morning session. Gold and Silver Prices showed strength in the morning session as Global growth concerns haunted the Equity markets and increased the safe haven demand for Gold and Silver. Crude Oil Prices continued to slide further as Iraq increased the discount for Crude Prices which could further increase Global supply. Natural Gas traded flat in the morning session. Weakness continued to exist in Base metals on supply concerns and Nickel was trading marginally up which could have mainly been due to bargain hunting.

 

Evening outlook:

Gold and Silver could make more gains in the Evening session; Crude Oil is expected to fall further while Natural Gas could make gains; Base Metals could continue to trade low in the Evening session

 

Stock Recommendations:

Bajaj Auto – Buy at Rs.2348.80(CMP); Target - Rs.2375.00; Stop Loss – Rs.2325.00

Reliance Industries Ltd.–Buy at Rs.957.90(CMP); Target - Rs.970.00; Stop Loss – Rs.948.00

BPCL– Buy at Rs.671.75(CMP); Target - Rs.679.00; Stop Loss – Rs.664.00

 

Sectors Snapshot

Bank Nifty: Bank Nifty made a strong recovery rising 223.70 points ahead of CPI data to be released today. Overall buying was seen on banking stocks with IndusInd bank touching all time high on back of strong Q2 results. Strength was seen in PSBs. Federal bank was top gainer on the index.

CNX Energy: Energy index opened lower but erased losses and traded in positive closing 0.10% up. Reliance Q2 results were awaited with Reliance trading flat. TATA Power rallied 2.84 % on reports of the co. is in talks with PE firms for M&A deals. NTPC was top loser on the index.

CNX Pharma: Pharma stocks witnessed weakness and fell 1.39%.  Major stocks dragged the index with sharp profit taking seen. Sun Pharma, Dr. Reddy and Cipla lost more than 2% dragging the index while Cadila closed up by 2.03%.

CNX Media: Media index erased early losses as mid cap stocks lifted the index. Major stocks like ZEE and Sun TV traded with negative bias keeping CNX media under pressure.  DB Corp and Den networks rose more than 3%.

India VIX:  VIX rose 1.19% ahead of CPI data.

 

Market Movers

Gainers

TATA Power: The shares of the company were seen up by 2.84% to close at 85.15 as the company said it is in talks with various private equity firms to explore merger and acquisition deals. Company was asked to give clarification on an article titled 'Tatas, ICICI venture may team up for power play' where company clarified that no commitment has been made by the company

Losers

DLF: Shares of the company were sown as Delhi High Court rejected DLF's petition challenging CCI's jurisdiction to investigate the sale of company's flats prior to 2009. The Court also charged the company for attempting to delay the proceedings by filing the petition. Shares were down by 3.77% to close at 146.90.

 

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