Wednesday, January 5, 2011

Expect a subdued opening and lacklustre trade in the first half

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Indian equities might see a flattish opening and a lacklustre trade in the morning session of trade today on flattish global markets. Investors abandoned red-hot commodity shares on Tuesday, while fears of lower supermarket profits hit food retailers, sending the S&P and Nasdaq lower while Dow Jones closed in the green.

Asian markets are trading mixed with Shangai taking a knock of nearly one percent and Nikkei trading flat.

News Bytes

* L&T to be split into nine independent entities

* Natco seeks Pfizer nod for HIV drug clone

* Maruti sales jump 17% in Dec, exports drop 29%

* Lakshmi Vilas Bank eyes QIP in February-March

* Max India to seek shareholders nod to invest Rs 750 cr

* Iconix signs licensing deal with Arvind for Mossimo

* Cement overcapacity set to double inside two years

* Dishman eyes $20-25 million revenues from China API unit

* IGate, Apax set to buy Patni in 3-stage deal for around $1 bn

* FDI dips 7% to $1.6 bn in November

* RPower targets 1,000 MW renewable capacity

Markets - Some more consolidation before take off

We expect markets are likely to spend some more time in this band before the take off.Bearish signs are not in sight and we do not expect major correction till March-April this year. Till then it is time to ride the rally. Midcap and smallcap stocks will outperform large caps this year on account of thumping performance