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

Nifty at all time high, Auto and infra leads

“Indian equity markets joined the global rally today. ECB announced bigger than anticipated QE program to spur growth and fight deflation. This move was cheered by equity markets around the world with Wall Street turning positive for the year and Asian markets trading higher in morning session. Infra stocks led the rally on Nifty while on outlook of rising demand and reducing cost of funds after RBI rate cut auto stocks also saw major inflows. Sensex marched towards 30,000 mark led by continuing FII flows. Slight rebound in oil led to some up move in energy stocks. Indian Rupee also showed positive momentum against the greenback. Major cues which will to provide direction to market are US Fed decision this month, Greek elections and RBI policy. While major turning point is seen as the Union budget.”, Mr. Kiran Kumar Kavikondala said.

Indian Markets

Indian equity markets joined the global rally today. ECB announced bigger than anticipated QE program to spur growth and fight deflation. This move was cheered by equity markets around the world with Wall Street turning positive for the year and Asian markets trading higher in morning session. Infra stocks led the rally on Nifty while on outlook of rising demand and reducing cost of funds after RBI rate cut auto stocks also saw major inflows. Sensex marched towards 30,000 mark led by continuing FII flows. Slight rebound in oil led to some up move in energy stocks. Indian Rupee also showed positive momentum against the greenback. Major cues which will to provide direction to market are US Fed decision this month, Greek elections and RBI policy. While major turning point is seen as the Union budget.

Other Asian Markets

Asian markets extended the rally from global markets. ECB QE effect was clearly seen on Wall Street which provided strong positive cues to European and Asian markets. Nikkei rallied more than a percent while HSI rose close to 1.34%.

Commodity Outlook:

Commodity Market showed moderate volatility in the morning session; Gold and Silver remained weak in the morning session due to profit taking after the rally yesterday due to quantitative easing by ECB; Crude Oil showed moderate strength in the morning session after death of Saudi Arabia King while Natural Gas prices rebounded on cold weather outlook in USA. Base Metals remained weak in the morning session due to rising supply concerns.

Evening outlook:

Gold and Silver could continue to slide in the Evening session; Crude Oil and Natural Gas are expected to be range bound while Base Metals could make moderate gains in the Evening session.

Stock Recommendations:

Axis Bank - Sell at Rs. 565.15 (CMP) ; Target – 558.00; Stop loss – 572.00

ONGC - Buy at Rs.348.80(CMP); Target -Rs.353.00; Stop Loss –Rs.345.00

GAIL India - Sell at Rs.422.95(CMP); Target -Rs.417.00; Stop Loss –Rs.426.00

Sectors Snapshot

Bank Nifty: Banks mostly showed positive momentum today after ECB started QE liquidity driven rally was seen. Few PSBs saw further profit booking today while stability in Rupee supported the overall positive momentum. US Fed policy was eyed market participants for further cues.

CNX IT: Major IT stocks moved higher but limited gains were seen. Global strength in tech stocks coming from positivity in equity markets kept the index in positive. Mid cap saw some profit taking dragging the index. Q3 earnings so far has provided positive cues to IT stocks.

CNX Energy: Energy sector gained over 50 points in the session today powered by Tata Power and Cairn India which gained over 5% and 4% respectively while BPCL also gained over 2%. Upside for the Index was kept limited by GAIL India and ONGC which lost over a percent each.

CNX Pharma: Pharma index closed in positive today the overall breadth remained subdued with few stocks lifting the index. Cipla gained more than 3% after UK gave OK for its nausea relieving pill. Flows were seen directed to cyclical today keeping defensive pharma with capped gains.

Market Movers

Gainers

Sun Pharma: Tata Power was top gainer today after the news that govt. officials on UMPP panel will meet today to review bid documents for the planned UMPPs across the country.

DLF: DLF saw inflows today and continued to rally. RBI rate cut and strong inflows in infra stocks kept the stock higher. ECB QE program and RBI rate cut were seen as positive for the sector.

Losers

PNB: PNB saw profit booking after recent up move. Caution was seen among market participants ahead of PNB Q3 numbers on Feb 3.

GAIL India: GAIL India shares saw selling today after India’s plan to build 3 of 9 LNG carriers required by GAIL was seen in danger.

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