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

Nifty ends below 8300, energy weak as crude slips further

“Indian benchmark indices could not sustains early gains and Nifty tested 8270 levels on sharp profit booking. Nifty higher tracking strong inflation and IIP data released yesterday. CPI came at 5% for month of December reflecting fall in oil prices and global disinflationary effect in domestic inflation. IIP was registered at 3.8% for November reversing trend in October. Equity markets cheered this data and bucking global trend and weak close on Wall Street opened higher but could weakness in global markets and falling oil prices weighed on the index with Nifty breaking 8300. Momentum remained mixed on the index with IndusInd bank posting results slightly below estimates though asset quality for Q3 remained stable. IT stocks were mixed taking a breather; Rupee maintained gains made against the greenback in previous session supporting inflows in Indian markets.” , Mr. Kiran Kumar Kavikondala said.

Indian Markets

Indian benchmark indices could not sustains early gains and Nifty tested 8270 levels on sharp profit booking. Nifty higher tracking strong inflation and IIP data released yesterday. CPI came at 5% for month of December reflecting fall in oil prices and global disinflationary effect in domestic inflation. IIP was registered at 3.8% for November reversing trend in October. Equity markets cheered this data and bucking global trend and weak close on Wall Street opened higher but could weakness in global markets and falling oil prices weighed on the index with Nifty breaking 8300. Momentum remained mixed on the index with IndusInd bank posting results slightly below estimates though asset quality for Q3 remained stable. IT stocks were mixed taking a breather; Rupee maintained gains made against the greenback in previous session supporting inflows in Indian markets.

Other Asian Markets

Asian markets took cues from Wall Street and closed mostly in red. The weakness was also result of fears of slowdown on account of continuing fall in oil prices. China posted balance of trade data in line with expectations. Japan posted current account surplus which failed to lift sentiments on equities.

Commodity Outlook:

Commodity Market showed lot of volatility in the morning session; Gold and Silver Prices continued to rally in the morning session as uncertainty continued in Equity Markets due to drop in Oil Prices. Crude Oil Prices continued to hit lows as UAE defended the production levels while Natural Gas Prices also bounced from lows due to bargain buying by Investors. Base Metals continued to slip in the morning session due to weak Equity Markets and key Economic data ahead.

Evening outlook:

Gold and Silver Prices are expected to stay strong in the Evening session; Crude Oil Prices are expected to stay weak while Natural Gas Prices could hold onto to their gains; Base Metals are expected to trade sideways in the Evening session

Stock Recommendations:

ING Vysya Bank – Buy at Rs. 997.35(CMP); Target -Rs. 1008.00; Stop Loss –Rs. 988.00

Yes Bank - Buy at Rs. 781.75(CMP); Target -Rs. 790.00; Stop Loss –Rs. 773.00

Apollo Hospitals - Buy at Rs. 1150.1(CMP); Target -Rs. 1163.00; Stop Loss –Rs. 1137.00

Sectors Snapshot

Bank Nifty: Bank Nifty closed in red today taking breather from the recent up move. The stocks closed mixed with strong IIP and inflation data and Rupee stability supporting while Q3 results weighing on the index. IndusInd bank posted slightly below Q3 numbers which kept investors cautious on banks today.

CNX IT: CNX IT also closed in red but the downside was limited as expectation s of strong Q3 results remained. Major stocks closed mixed but Infosys saw some technical correction and profit booking which dragged the index. Further up move will be largely dependent on Q3 results in short term.

CNX Energy: Energy sector lost nearly 100 points for second continuous day as crude oil continues to slip to new lows; all stocks in the sector closed in positive expect IOC which benefited from fall in crude oil prices. ONGC was the biggest loser in the sector losing over 2%.

CNX Pharma: Index opened marginally up and was seen trading in positive but later erased their gains due to weakness in stock markets. Index was dragged by Aurobindo Pharma while Divi's Lab supported the index.

Market Movers

Gainers

Ultratech Cement: Stocks surged after a report said that Motilal Oswal Securities is bullish on the stock as they expect a decline in the input cost.

Asian Paints: Shares rose on back of falling crude oil prices and also company got approval to set up 25000 ton unit plant in Indonesia.

Losers

DLF: Profit taking continued from past three sessions after stock surged over 6% due to short covering.

ONGC: Shares of energy space was seen under pressure as crude was seen falling to almost six years low as Goldman Sachs lowered its forecast.

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