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

Nifty conquers 8500 mark; Looks set for more gains

“Equity markets gained today with Asian markets cheering rate cut by China to boost growth. Indian metal stocks rose on anticipation of reviving manufacturing activity in China. IT stocks rose as Rupee showed weakness ahead of Q2 CAD data expected to be released by RBI today. Banking stocks gained of this consecutive session as capital infusion in PSB, winter session in Parliament, hopes of GST bill passage and dovish stance by ECB and China’s central bank lifted sentiment” , Mr. Kiran Kumar Kavikondala said.

Indian Markets

Equity markets cheered the rate by China’s central bank to boost growth. Global markets showed strong positive sentiment supporting Indian equity markets. Nifty opened higher on back of strong Asian markets and strength in Rupee. But capped gains were seen on Nifty as sentiment became cautious ahead of Q2 CAD data release by RBI. Also, winter session of Parliament was adjourned for the day after demise of Murali Deora early this morning. Banks gained as dovish sentiment was seen by global central banks of China and ECB. Metal stocks lifted the index on anticipation of boost in Chinese manufacturing post rate cut. IT stocks also gained after Rupee showed weakness during the session. Major IT stocks inched higher lifting Nifty.

Other Asian Markets

Asian indices rallied with China’s benchmark SSE composite registering strong gains post China policy action of rate cut to boost growth in slowing economy. Japan also registered gains after gains in Wall Street and snap election announcement. HSI rose close to 2% on back of dovish central bank stance in China. Most Asian currencies were strong against USD.

Commodity Outlook:

Commodity Market was very volatile in the morning session. Gold and Silver Prices continued to trade with positive bias due to Chinese rate cut but strong equity markets kept their upper side limited. Crude Oil looked strong ahead of OPEC meeting later in the week while Natural gas lost over 5% as temperature in USA turned warm. Base Metals were positive due to increase in demand in China while strong dollar kept the upper side limited for Copper.

Evening outlook:

Gold and Silver Prices are expected to be weak in the Evening session; Crude Oil and Natural Gas are expected to be flat while Base Metals are expected to be strong in the Evening session

Stock Recommendations:

Cairn India – Buy at Rs.274.25 (CMP); Target –Rs.277; Stop Loss –Rs.272

Wipro - Buy at Rs.579.35(CMP); Target –Rs.585.50; Stop Loss Rs.573.00

Bank of India - Buy at Rs.283.45(CMP); Target - Rs.286.50; Stop Loss – Rs.280.50

Sectors Snapshot

Bank Nifty: Bank Nifty gained today on third consecutive session as global sentiment remained stronger, PSU banks are expected to get capital infusion of 11,200 crores Rupees shortly from government and market participants factored in a possible dovish stance by RBI in upcoming credit policy review on back of falling inflation.

CNX IT: Major IT stocks were weak in initial hours of the trade but as Rupee depreciated buying was seen in export oriented IT stocks with Infosys registering in top gainers on Nifty. Also, buying was seen in IT stocks after breather taken by CNX IT in previous sessions.

CNX Energy: Energy Sector traded with weakness in the session today as Investors were cautious ahead of the OPEC meeting later this week which could determine the fate of Crude Prices. Cairn India made gains for 3rd straight session due to bargain hunting by Investors at lower levels.

CNX Pharma: Profit taking was seen in this space as inflow was seen in cyclical stocks. Index was dragged down by Glenmark Pharma, which got approval from UK to sell Cromviva capsules. Cipla also contributed by falling more than 1%.

Market Movers

Gainers

DLF: Stock rose after news that DLF moved to SC seeking waiver from depositing Rs.5.8 billion competition panel fines that apex court had asked and instead accept the land as a security.

JSPL: JSPL gained after a surprise rate cut in China, the largest base metals consumer, this stimulus would bring stability in metals prices. Stock was top second gainer among Nifty.

Losers

Power Grid: Stock fell as FPI's investment in the company reached its trigger limit of 28% and requires RBI permission for purchase of more shares of the company.

Cipla: Company gets approval from US FDA for finasteride and profit taking was seen in today's session after a rise in past two sessions.

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