Tuesday, March 29, 2011

Technical Outlook: Bullish momentum looses steam.....

Market Outlook: Indian markets are expected to open flat and trade range 5660-5695 while On the global front Wall Street ends lower amid light trading while Asia trading lower; Nikkei, Shanghai Composite slip. Overall outlook for the markets today is that of cautious optimism with 5600 levels as a major support.

Global events to watch

Þ Consumer Confidence

Þ State Street Investor Confidence Index

Global indices Update @ 8:

Dow Jones : 12197 (-22.71)

NASDAQ : 2730 (-12.38)

Nikkei 225 : 9338 (-139.5)

Hang seng : 23028 (-39.23)

SGX CNX Nifty : 5694 (- 10.00)

Gold (USD/t oz.) : 1419 (+01.90)

Nymex Crude (F) : 103 (-00.52)

INR / 1 USD : 44.85

Technical Outlook: Bullish momentum looses steam.....

As we said, 18950-19050 will act as strong resistance for the day, Sensex witnessed first selling pressure at 18950 and slipped down almost 100 points in intraday trade in mid session. After opening lower followed by weak Asian cues, Sensex bounced back above psychological levels of 19k mark ( Nifty 5700). At the end, Sensex closed at 18943.14 up 127.50 points or 0.68% and Nifty closed at 5,687.25, up 33 points.

The formation of Stalled pattern with upper shadow against yesterdays huge bull candle on daily chart still indicates selling pressure on higher levels. In this case, as we said in previous note, if Sensex succeeds to hold above 18950 and sustain above 19050 then only it will continue its rise above 19300 levels in coming trade. Otherwise, it will creates the possibility of downward correction up to at least 18600 levels as intraday trade and up to 18280 as short term correction.

Overall, 18500 will act as main medium term support levels for the current rally. As long as Sensex holds this levels, the possibility Sensex testing 19300 or more levels remains wide open.

In intraday, 19050 in Sensex, 5730 in Nifty will act as strong resistance levels for the days. If indices fail to hold these levels, they will create the possibility of downward correction.

Resistance levels

Sensex ( last close 18943) 1) 19050 2) 19200

Nifty ( 5687) 1) 5730 2) 5775

Nifty Fut. ( 5699) 1) 5740 2) 5785

Bank Nifty ( 11559) 1) 11680 2)11860

Support levels

Sensex 1) 18800 2) 18650

Nifty 1) 5647 2) 5617

Nifty ( Fut) 1) 5657 2) 5627

Bank Nifty 1) 11500 2) 11360

Stocks in Action for the day: Natco Pharma, Dr Reddy’s, Dewan Housing, Reliance Infrastructure

Blue Star Infotech has been appointed as the IT partner to implement Microsoft Dynamics AX solution and streamline operations including finance, purchasing, manufacturing, sub-contracting, inventory, sales & dispatch and quality control of Christ Nishotech, a water-purification company in the pharmaceutical and life sciences space.

Natco Pharma has received “Orphan Drug Designation” from the USFDA for three indications - Glioma, pancreatic cancer and chronic myelogenous leukemia. Orphan Drug Designation is given by the USFDA for rare diseases that affect less than 200000 patients.

Hatsun Agro Product has decided to stop its rural retail operations and said that “closure of the operations does not have any significant impact on the operations of the company.

Century Plyboards has approved demerger of the ferro alloys and cement division to Star Ferro And Cement.

The Great Eastern Shipping Company has taken delivery of new building Supramax Dry Bulk Carrier.

Atlanta plans to construct a residential complex at 6448.50 square meters of land it acquired in Kandivali, Mumbai.

Ceat has commenced commercial production of passenger / truck radial tyres at Halol plant with effect from March 25, 2011.

Marico has divested its refined sunflower oil brand “Sweekar” to Cargill India with immediate effect.

India Glycols is setting up a Private Freight Terminal under a joint venture with Fourcee Infrastructure Equipments providing railways-based logistic services and other facilities at Kashipur, Uttarakhand. The facility would be adjacent to the existing plant at Kashipur.

Dr Reddy’s Laboratories has launched Levocetrizine tablets, a bioequivalent generic version of Xyzal tablets in the US market. Levocetrizine had total sales of approximately $238 million for the twelve months ending September 30, 2010.

Shriram City Union Finance plans to raise up to Rs 750 crores by issuing non-convertible debentures of varying face value on private placement basis or to the public.

Dewan Housing Finance has acquired 67.50 per cent stake in Deutsche Postbank Home Finance, a housing finance company registered with the National Housing Bank.

Future Capital Holdings has approved to sell the stake of 50 per cent held in FCH CentrumDirect joint venture. It plans to acquire 50 per cent stake in FCH Centrum Wealth Managers and make it a wholly owned subsidiary.

Jyothy Laboratories will consider private equity funding to digest a potential acquisition of Henkel India after some big global funds like Carlyle, TPG and Apax Partners approached it with commitments of $100 million each.

NMDC is likely to delay revision in iron ore prices for the April-June quarter by 15 days to mid-April as long-term contracts with Japanese steel mills have not been renewed yet.

Reliance Infrastructure has withdrawn proposal for internal reorganization of some of its businesses and its 100% owned subsidiaries. “There is no impact on the profitability or business,” the company said in a statement.

Shipping Corporation of India is all set for adding two anchor handling towing and supply vessels of 120 T. bollard pull capacity each to its offshore fleet.

Transport Corporation of India has started rail cargo express service from Bangalore to Guwahati. According to the company, TCI Freight, the surface transport division of TCI, will run weekly cargo train leaving Bangalore every Sunday.


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