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WealthRays Securities Source Name: WealthRays Securities

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

Oct 16, 2014   18:05 IST 
India

Synopsis:

Indian benchmark indices opened lower following weakness on Wall Street and again a triple digit fall on Dow. European markets continued its selloff for second session with major benchmark indices falling more than a percent. Weakness in Rupee also weighed on markets as FII outflows continued. Election outcome of Maharashtra and Haryana expected in coming days kept market participants cautious. Also, widening of trade deficit for month of September maintained a negative bias on markets. DLF recovered today after falling 28% in previous session while metal, banking, and auto stocks dragged. Nifty broke 7750 and saw a weak closing near its intraday lows at 7748.20. Sensex closed below 26000 levels at 25999.34”, Mr. Kiran Kumar Kavikondala said.

 

Indian Markets

Indian benchmark indices opened lower following weakness on Wall Street and again a triple digit fall on Dow. European markets continued its selloff for second session with major benchmark indices falling more than a percent. Weakness in Rupee also weighed on markets as FII outflows continued. Election outcome of Maharashtra and Haryana expected in coming days kept market participants cautious. Also, widening of trade deficit for month of September maintained a negative bias on markets. DLF recovered today after falling 28% in previous session while metal, banking, and auto stocks dragged. Nifty broke 7750 and saw a weak closing near its intraday lows at 7748.20. Sensex closed below 26000 levels at 25999.34.

 

USDINR opened higher today breaching 61.5 and continued to move towards 62.00 and was trading near its intraday high of 61.8750 as Indian equity markets closed. Weakness in equity markets weighed on currency. Consistent FII outflows from capital markets kept Rupee under pressure. Major concern was widening of India’s trade deficit for September on back of spike in gold import. USD Index was down while Asian currencies were mostly weak against USD.

 

Other Asian Markets

Asian indices also closed down with Nikkei shedding more than 2% on stronger Yen. Ebola breakout and growth concerns dragged the equity markets in Asia. Weak momentum from US markets weighed on markets. Steel and real estate sectors dragged SSE composite with it losing 0.72%.

 

Commodity Outlook:

Commodity Market was very volatile in the morning session. Gold and Silver Prices made significant gains as Equity Markets routed due to global growth fears. Crude Oil slipped to fresh lows due to global oversupply and Natural Gas Prices remained strong on chilly weather forecasts in USA. Base metals could to slip furthers due to supply concerns and weak global Equity Markets

 

Evening outlook:

Gold and Silver Prices could remain strong in the Evening session as Equity markets are seen down; Crude Oil is expected to slip while Natural Gas could remain; Trading is expected to be weak in Base Metals in the evening session.

 

Stock Recommendations:

HDFC BANK – Sell at Rs.858.85(CMP); Target - Rs.850.00; Stop Loss – Rs.867.00

ITC –Buy at Rs.352.45(CMP); Target - Rs.356.00; Stop Loss – Rs.349.00

ONGC – Sell at Rs.397.10(CMP); Target - Rs.393.00; Stop Loss – Rs.401.00

 

Sectors Snapshot

Bank Nifty: Bank Nifty gave up gains in last hour of the trade shedding 209.95 points. The bias was largely negative on banking stocks with both private and public banks losing. Trade deficit weighed on the index. Federal Bank (-5.43%) was top loser on the index.

CNX Energy: Energy index also opened lower and closed near intraday lows of the day. Power and oil stocks witnessed sell off with Reliance losing 3.15%. BPCL bucked the trend and closed 1.52% up.

CNX Pharma: Pharma stocks saw sharp selloff in last hour of the trade and closed 1.09% down. Cipla closed flat at +0.03% while Sun Pharma, Dr. Reddy’s and Ranbaxy dragged the index.

CNX Media: Media index held on to 2000 mark after touching intraday low at 1989.Breadth was negative on the stocks with Zee losing for second day and closing down by    -1.22%. Den networks (-6.02) % saw sharp profit booking.

India VIX: Volatility index rose 12.61% as fear escalated in markets on weakening in equity markets.

 

Market Movers

Gainers

DLF: Shares of the company were seen up in today's session due to buying at lower levels after consecutive selling from past two days after SEBI barred the company and some of its members from accessing the stock market. It was the top performer among the nifty constituents gaining 5.15% to close at 110.35.

Losers

Ultratech Cement: Stock was seen trading low in today’s session after media report said that company will bid for assets owned by French cement company Lafarge SA in southeastern Brazil. Hence, NSE has asked for the clarification regarding this news. Shares were down by 6.06% to close at 2317.60.

 

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