The markets opened higher yesterday on the back of positive trend in the Asian markets and remained steady throughout the session except a mild profit taking around noon after the May inflation data which was at 10.16%. The markets, however, rallied sharply thereafter in mid afternoon on hectic buying in frontline stocks and finally closed the day in the positive. The Nifty closed gaining 78 points or 1.53% at 5197 which is slightly off the day’s high of 5201. The afternoon rally is attributed to the rating upgrade by Fitch Ratings which helped the buyer's sentiment up to a significant extent. The global rating agency upgraded India’s currency to stable from negative, and forecast a decline in Government Debt to GDP ratio to 80% by March 2011 from 83% at the end of March 2010. It raised the country’s growth forecast to 8.5% in the year to March 2011, from an earlier projection of 7%.
WE ARE IN UPPER END OF THE RANGE BOUND MARKET 4933-5244.
INFLATION NUMBERS NOW IN TWO DIGITS. RBI IS UNDER PRESSURE TO CONTROL INFLATION. ANOTHER RATE HIKE IS LIKELY IN NEARTERM
US TREASURE ROLLS $284 Bn IN BILLS, $310 DAYS OF JUNE, CASH BALANCE DOWN TO $4.3 Bn.
FOR TUESDAY:: The Nifty Future to make further up move needs to trade and remain above 5226 and 5244/5250 area whereby it may move up to 5278/5298 in this uptrend. Strong support for the NF exists at 5169.25 which if breached decisively with volumes then NF may slide to 5141/5122.
MICROSEC RESEARCH:: Five Picks for Investment are as Follows:
Company CMP Target Price Upside (%)
Banco Products 103 135 31%
Fedders Lloyd 96 157 64%
Lloyd Electric
& Engineering 76 126 66%
Surya Pharma 167 253 51%
Patel Engineering 392 500 28%
Disclaimer: I have no position. Probably, I'll initiate a short position around 5241 (if possible).
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