THE FIIs WERE NET BUYERS WITH INVESTMENT WORTH 272.99 CR. (PROV. CASH MARKET FIG.).
The Sensex fell below the psychological 19,000 mark. The 50-unit S&P CNX Nifty fell below 5,700 level.
The key benchmark indices dropped nearly 1% as investors fretted over the possibility of more interest rate hikes by the Reserve Bank of India (RBI) to tame inflation. The central bank raised its lending as well as borrowing rates by a quarter-point to cool inflationary pressures at a quarterly policy review today, 25 January 2011. Interest rate sensitive banking, auto and realty stocks declined. The BSE 30-share Sensex was down 181.83 points or 0.95%, off close to 380 points from the day's high and up close to 5 points from the day's low. The index gained 189.71 points at the day's high of 19,340.99 in mid-morning trade, soon after the RBI's policy announcement. The index declined 201.84 points at the day's low of 18,949.44 in late trade.
The S&P CNX Nifty was down 55.85 points or 0.97% at 5,687.40.
The BSE Mid-Cap index fell 0.41% and the BSE Small-Cap index declined 0.35%. Both these indices outperformed the Sensex.
Current growth and inflation trends warrant persistence with the anti-inflationary monetary stance, the RBI said.
The market breadth was negative in contrast with strong breadth earlier in the day. The market breadth was negative compared with strong breadth earlier in the day. On BSE, 1687 shares declined while 1,212 shares advanced and a total of 110 shares remained unchanged. Among the 30-member Sensex pack, 19 declined while the rest rose.
BSE clocked turnover of Rs 3610 crore, higher than Rs 2906.36 crore on Monday, 24 January 2011.
VIEWS FROM DIFFERENT BROKING HOUSES:
GEOJIT BNP PARIBAS FINANCIAL SERVICES:
“Being the January expiry, we may see highly volatile movements. For Nifty the major support is there at 5,615 and 5,585. One thing to note is that the Nifty futures have started to trade at a discount to the spot indicating weakness”.
BONANZA PORTFOLIO (AVINASH GUPTA)::
“The market is expected to be volatile in view of the expiry of derivative contracts due on 27th Jan. The consolidation process in a range of 5,550/5,800 is expected to continue”.
ANGEL BROKING HOUSE:
“Markets opened higher but were unable to sustain the early hour gains which dragged down the indices to close in red. On the daily chart, we are observing that prices have taken resistance at the 20-day SMA which suggests further weakness. In coming trading session, if indices trade convincingly below 18,940/5,675 levels then they are likely to test 18,794-18,674/5,634-5,600 levels. On the upside, 19,188-19,340/5,750-5,800 may act as support for the day”.
BONANZA PORTFOLIO (PUNEET KINRA):
“Nifty showed selling pressure from 5,800 levels and made bearish engulfing candlestick pattern, which shows bears are again having control at the moment. As long as Nifty trades above 5,600 levels, volatility in 5,600-5,850 levels may be seen. On maintaining below 5,600 or above 5,750 levels, decisive price action may also be seen”.
“For daily purpose, the trend deciding level is 5,680. If Nifty shows strength above 5,680 level, then rally to 5,730/5,770/5,800 levels may be seen. If Nifty does not show strength above 5,680 levels then selling pressure till 5,625-5,600/5,550 levels may also be seen”, he added.
FAIRWEALTH SECURITIES:
"In the next session, Nifty is expected to face resistance in 5757-5777 zone. Breaching of 5620 level in Nifty may cause severe selling pressure. Oil-marketing companies may again perform well along with Auto stocks. While, Pharma and FMCG may stay weak.
Sell Reliance below 953 for a target of 943-933 with stoploss above 963
Sell Tatamotors around 1170-1175 for a target of 1155-1140 with stoploss above 1188
KARVY STOCKS:
"The market will take cues from the global markets and is expected to open on a flat to positive note tomorrow. Nifty is expected to be highly volatile on account of rollover of positions in the derivatives segment. Traders are advised to trade short on rallies in Nifty from 5720 and 5700 levels targeting 5650 levels".
INVESTMENT CALLS:
LARSEN & TOUBRO (I) LTD.: BUY above 1630 with a stop loss of 1575 level for the price targets of 1750 and 1820 levels respectively.
The counter looks strong above 1630 level and is trading in a oversold levels. Earlier the counter corrects from 2000 till 1637.00 which is 20 % price correction. Momentum indicator like RSI is trading in a highly oversold level and is trading consistently below 20 level which will help the counter to bounce in near term.
THE FEDERAL BANK LTD.: BUY above 365 with a stop loss of 350 level for the price target of 405
The counter looks strong above 365 level and is expected to bounce in near term. The counter is hovering near its 200 DMA of 370 level and is trading in a short term oversold zone. The counter gives a positive divergence on a daily technical chart and indicates a buy at current level.
TATA CHEMICALS LTD.: SELL TATA CHEM below 385 with a stop loss of 400 for the price target of 330.
The counter looks weak below `385 level as is expected to correct in near term. Technically speaking the counter is heading down in a lower top lower bottom price formation. The momentum indicator like RSI also suggests profit booking from current level.
OIL & NATURAL GAS CORPORATION LTD.: BUY ONGC above 1100 with a stop loss of 1070 level for the price target of 1170 in coming week.
The counter has corrected last week and is landed on its 200 DMA support area of 1100 level. The counter is expected to bounce from its oversold level. RSI has indicates a positive divergence from the oversold levels and signal a pullback in near term.
LUPIN LTD.: SELL LUPIN below 470 with a stop loss of 490 for the price target of 410 in coming weak.
The counter looks weak at current level and heading down in a lower top lower bottom price formation. Technical indicator like MACD and ADX also suggests weakness and is expected to correct below 470 levels.
NOTE: From now, only cash segment/investment purpose calls will be given in this blog and derivative calls will be given in the other blog.
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