Oh not again ! Get ready for another day of pain

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Indian Markets are most likely to open gap down in a big way and continue to trade down though volatility is not ruled out. Inflation figures to be announced late in the day will add no good to the markets. Though markets tend to surprise when all the pointers are looking bleak, unlikely to happen this time. Blood continues to spill in the midcap domain, where stocks are flying all over in the beginning of January 2008. We expected a huge correction in January or February but the extent of the correction is definitely beyond our expectations. Lack of retail participation only added to the woes of the falling market.

Blackstone is likely to increase stake to 12.2 percent in Nagarjuna Constructions reports a pink paper. The US private equity giant continued to add stakes in companies like Gokaldas Exports, Allcargo Global.

Stay on sidelines but long term investors are encouraged to add on dips as market continues its journey to reach Mr.Bottom. We are suffering since our neighbours are suffering. Our house is never safe if neighbours house catches fire! Internally our fundamentals are still strong.Nifty has tested 4800 twice and bounced. Hope we dont fall below it else the U would become even more flatter.We sees a recovery only in April and after

We saw some tired looking recovery on Wednesday. Will this sustain is another
question. The FII's have been continuously selling for the sake of meeting the redemption pressures from their investors. Many call up ask me why are FII's selling? Dont they find value in this mkt? The answer is that they do find values but the investors for the sake of safety and in panic keep redeeming their investments and hence FII's have no other option but to sell at what ever levels they can.

The next obvious question is when will this money return? Like the previous
crashes we may not have sharp recoveries. We always have been seeing a V shaped fall and a recovery this time it would be a U shaped and that too a U with a flat bottom, something like this... “ I_I “ and how long will this bottom be depends on the state of US economy. As of now we are not falling or rising on out own fundamentals or technicals we just see how US and Asia and EU mkts are doing and react to them.
People are now realising there is value in the market but theres no money to buy. Nifty has tested 4800 twice and bounced. Hope we dont fall below
it else the U would become even more flatter.We sees a recovery only in April and after

Stock in News- Petronet, GSS America, Advanta, KEC International, Adhunik Metalliks and many more stocks hit the headlines today.

Advanta India Ltd has acquired Garrison & Townsend (GT), a US company producing and marketing sorghum.

Mumbai based Parsvnath Developers is venturing into luxury malls segment in Metro Cities.

Reports are abuzz that MCX, in which Financial Technologies hold majority stake might delay the IPO due to Commodities Transaction Tax levied in the budget.

GAIL India Ltd is likely to pick up Asian Development Bank’s 5.2 per cent stake in Petronet LNG Ltd.

FM suggested the banks to lower the interest rates on housing loans of up to Rs 20 lakh.

Tech company GSS America Infotech is listing on the bourses today.

KEC International is planning to acquire a US based mid-sized company from the same segment (EPC) it operates in

Reports indicate Tata's are on the look out for USD 3 billion loans for the acquisition of Jaguar, Land Rover

NOT MUCH DOWNSIDE RECOVERY

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Indian Markets yet again proved to be the weakest among the Emerging markets and most importantly the Asian pack. Sensex tumbled to a 5 month low yesterday after a private TV channel tried to expose the subprime link of ICICI Bank, which the bank later denied. However ICICI Bank and its overseas banking subsidiaries have an aggregate exposure of USD 2.2 billion in credit derivatives.As of January 31, 2008, the mark-to-market negative on this portfolio due to movement of credit spreads was about US$ 155 million. The current declines should be used by long term investors to buy the stock. With ICICI Securities IPO coming up and demerger of many of the subsidaries will unlock the value in the stock.

Tata Motors is setting ambitious targets for Nano. The company is looking aggressively to export Nano to US and European markets. The stock is likely to outperform the market in the coming years on exports.

SEBI will meet today under the chairmanship of Mr.CB Bhave. SEBI is likely to slash all regulatory charges and approve realty Mutual Funds. FM remarked on Tuesday that FII's are not behind the recent market crash and there was no proposal to ban them.

It is high time for a bounce in the Indian Markets but technically we have no supports in place till 15,880 levels. Stay away from the markets till normalcy returns. There will not be any run away rallies this time

Stock in news - PNB, IRB Infra, Essar Oil, Deccan Aviation, Tata Communications, Hindalco and many more stocks hit the headlines today.

Tata Motors is looking out for the possibility of global licencing Nano.

Reports suggest Hindalco Industries has raised aluminium prices by Rs 5,000 a tonne on rising global aluminium prices.

Essar Oil has bagged an offshore gas block in Vietnam's prolific Song Hong basin. The company also plans to invest $60 million in hydrocarbon prospecting.

Arun Jain, CEO of Polaris in an interview with NewsWire18 acknowledged that banks in the US east coast are holding back projects aftermath subprime.

Tata Communications(VSNL) is planning to invest $500 million in Wimax.

BS reports that Vijay Mallya is planning to dilute 15-20 per cent of his 76 per cent holding in the merged airline (Kingfisher-Deccan).

IRB Infra was awarded the maintenance and operating contract of the entire road infrastructure in Kolhapur city, Maharashtra.

ET reports that Punjab National Bank is planning to sell a 26% stake in its primary dealership subsidiary, PNB Gilts.


The following notable stocks created nightmares for the investors in the last one week.


Stock Name Percent Lost Current Price (Rs.)
Suzlon Energy 23.5 240.25
Reliance Capital 22.3 1,521.20
Global Broadcast 22.3 170.45
Adlabs Films 21.1 709.15
Bombay Rayon 19.2 269.40
First Source 19.1 43.75
DLF Limited 18.9 676.45
India Infoline 18.9 909.95
Kotak Bank 18.6 685.95
Motilal Oswal 16.6 815.35
Jaiprakash Asso 16.6 225.10
Unitech 16.5 326.50
Nagarjuna Fert 16.3 45.15

After the Bear storm Bulls stay calm

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Many people say that Nifty will come to 4400 in near term, I don't disagree with them as anything can happen in market, but being a technical analyst I will only say that thinking of 4400 as of now is too early to say or too early to predict, market still looks good, only successful break below 4740 - 4760 will make me think of 4400 but as of now I will not support a point.


On the upside market is going to face resistance at 5035 - 5040 upon crossing this level we can look towards 5120 and after this crossing it can even target 5200 above this is not seen in tomorrow trade.

Pharma sector (Pharma: Healthy prescription for your portfolio) is in the pink of health yesterday as investors/funds rushed to take comfort in the defensive sector. Auto stocks continued to make merry after the budget sops. Gold is running and so is Crude and Silver. Copper hits a 22 month high. There is a huge rush for precious metals across the globe. Commodity analysts predict the continuation of the secular bull run in the precious metals space.

Retail Investors are reluctant to participate in the markets and rumours are flying at a rapid pace that BSE Sensex will kiss 12,000 levels. Looking at the trading volumes one cannot deny those rumours but when the reversal happens it doesn't given an indication too. This is a dangerous market to short too. Take a break. Pick your favourite destination and enjoy your holiday as the current markets will drive you nuts.

The street is likely to be subdued today with a 200 point range and the brokerage stocks hammering likely to continue further. As Merrill Lynch said yesterday that the resilience the US market despite of the continuous negative news flow is really surprising and at the same time the Emerging Markets are succumbing to the same news flow. As mentioned number of times no one can predict the bottoms. Long term investors should continue the bargain hunting

Stock in news - Infosys, TVS Motors, Sintex Industries, Gammon Infra, TCS and many more stocks hit the headlines today.

TVS Motors Feb vehicles sales fell 21 percent year on year

ET reports that Infosys is looking actively scouting for acquisitions in Europe and Japan.

Indian exports posted 20.47 percent growth in January.

Gujarat-based Sintex Industries iss on the lookout for an aquisition. The company ear marked Rs.595 crores for the same.

International ratings agency Moody’s has upgraded private sector major HDFC Bank.

Mint reports that Jignesh P. Shah, CEO of Multi Commodity Exchange of India Ltd, appears to be under investigation by the market regulator for alleged violation of insider trading regulation. Financial Technologies holds major stake in MCX.

Rupee hits a 5 month low against the US Dollar. Rupee ended the day at 40.40/41 levels, down from Friday’s closing levels of 40.01/02 against the US dollar.

TCS signs a multi-million euro deal with Nokia Siemens Networks.

Gammon India group company Gammon Infra IPO will open on Mar 10.

Steel Companies and Cement Companies are ready to hike prices in response to FM's budget

Time for another plunge ?or BLACK MONDAY

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Due Global conditions we are expected to open negative today butwith a gap down

On the downside we find immediate support at 5200 but that is not expected to be held, and we may drag down straight between 5110 - 5130.


The zone between 5110- 5130 should act as a good support and any break below this and trade below this level for sometime can create panic and we could see 4880 - 4920on Nifty.

The zone between 5360 - 5410 is acting as a very good resistance and many time I kept on saying that. And why we say that --- see market is taking reversal either coming nearer to this zone or by entering and then reversing. Let us have a few look at it

On 25th Jan market saw a high of 5399 and close at 5383. and then on 28 Jan (as 26 and 27 Jan we holidays) we saw market reversing even came down to 5071 but closed at 5274 The next day 29 Jan again market went high to 5391 then again reversal happened and market close at 5280

On 4th Feb Market again tried to cross 5400 and this time it was successful and even went high up to 5545 but then close at 5463 and the next trading day (6th Feb) we saw reversal and market came down and close at 5322 by hitting a low of 5257

On 19th Feb, market went high to 5368 and then it saw a reversal from there and from there market went down to as low as 5116 on 20th Feb.

And recently on 27 Feb, market again went high again to 5368 and then a reversal from there made market went low to 5098 on 29 Feb.

Let market give the direction clear and then enter. Expected to play between 5110 - 5200 any side breakout should then be carefully taken

Chidambaram, Indian Finance Minister as expected announced more reforms, wasting a golden oppurtunity to boost the reeling Dalal Street. Though there were not much of expectations from the budget this year negative global cues might have a say on the street today. Trading volumes reduced by as much as 30 percent in the last two months. Brokerage stocks are likely to be impacted negatively on the news of increase of STT.

Few midcaps are likely to continue the run on positive implications from the budget. Indian markets are going through a bad patch, inline with their global peers. We are still positive on the economy and favour the Bulls. We expect a worst case scenario of BSE Sensex slipping to 14,000 levels in case of a recession. But value investors should not be concerned about the same.

Watch for VSNL (Tata Communications), Tata Teleservices and GTC Industries in today's trade

Stock in news - GTC Industries, ICSA, Kinetic Engineering,Tata Teleservices, VSNL are the stocks in news today.


Shipping Corporation in reported to be in talks with Korea’s STX for a shipbuilding Joint Venture.

Tata Communications Ltd, formerly Videsh Sanchar Nigam Ltd, is in discussions with Temasek Holdings Pvt. Ltd for a possible stake sale in its retail and broadband business.

Cigarette manufacturer GTC Industries announced that its board of directors has considered and granted an in-principle approval to demerge the tobacco and the real estate business into two separate entities.

ICSA is eyeing Rs 100 crores from oil and gas infrastructure projects.

Spice Communications registered Rs 399.92 crores net profit in Q3

Reports say ICICI Securities Ltd, the broking arm of ICICI Bank Ltd is planing to sell about 3% of its equity to institutional investors through private placement.

Tata Teleservices will launch Virgin Mobile, a UK based Virigin Group Company in 50 cities initially and in more than 1,000 cities by the year end.

Pune based Kinetic Engineering sold 14.5 percent stake to AIG.

Thumbs Up to FM's budget today

Finally budget day.
But cautious is advised as today the market to swing in the tune of FM.
On the downside the Nifty finds a support at 5220 and then at 5170 and then 5130
5020 is a good support which is not expected to be broken in tomorrow trade.

On the upside Nifty faces a resistance at 5320, 5350 and as usual still maintaining my words the zone of 5370 - 5410 is a tough resistance

Trading strategy -- Don' trade simply because you want to trade. Can skip tomorrow trade, or else do quick buying and selling

Indian Markets are in no mood to couple with global markets from the last couple of days though F&O settlement tried to create ripples. Markets are lacklustre and are expected to react sharply on the up today unless Mr.Chidambaram hands over a negative surprise. With very low expectations set in the run up to budget the downsides are negligible. Lets take a peek at the Industry wish list.

1. IT Sector - Looking for an extension of the STPI (Software Technology Park of India) scheme, which expires on March 31, 2009.

2. Telecom Sector - Looking for a cut in license fee

3. Oil Sector - Looking for series of tax and duty changes related to oil product retailing, exploration activities and natural gas

4. Textiles - More sops to the sector like enhanced TUF(Technology Upgradation Fund).

5. Consumer Durables - Looking for more attention in the form of incentives as a slow down is visible.

6. Automobile - Looking forward to a reduction in excise duties.

7. Pharma - Looking for Price control and tax benefit from investments in R&D

8. Agricommodities - We believe this sector is likely to grab major attention today from Mr. FM

9. Fertilizers - More subsidies look imminent here

10. Infrastructure - Looking for more allocations towards the development of infrastructure in the country

General

Positives : Increase in FII investment in sectors like such as media, banking and insurance.

Negatives : Likely tax net on Mauritius registered VC's

It is always tough to read the mind of the FM, proved number of times. But the expectation that the budget will prefer the common man will be spot on as the Government will try to pacify him along with the political allies in the wake of next year's general elections.

Majority analysts feel the budget is a non-event. We think otherwise and this is the only opportunity for Bulls to take advantage visible for the next 40 days or so. Keep fingers crossed and the coin tossed till Mr.Chidambaram opens the mystery bag.

Stock in news - Aban Lloyd, IB Real Estate, Matrix Labs, DLF, Gammon and other stocks hit the headlines today.


NIIT Technologies has acquired German-based SofTec GmbH, a specialist in providing IT solutions and services in the airline revenue accounting and operations space.

Sonata Software Ltd has teamed up with Oceanus, a UK based company to enhance their development of integrated Case Management Solutions and Environment Management Solutions, which are specifically designed for customer service environments.

DLF is likely to invest about $5 billion or Rs 20,000 crore to build and operate more than 25,000 rooms in the next 7-8 years.

Gammon India has filed the Red Herring Prospectus in connection with the IPO of its subsidiary Gammon Infrastructure Projects Ltd (GIPL).

Apollo Hospitals is likely to set up a Rs 280 cr hospital in Mauritius

Indiabulls Real Estate (IBREL) will acquire its partner Dev Property Development (DPD) in an all-stock deal worth

Aban Offshore Ltd has received a 3 well contract offshore Myanmar, for the jack-up drilling rig Deep Driller 5, with an estimated duration of 4 months. This contract will be in direct continuation of the current contract with Cairn Energy Sangu Field Ltd. The estimated contract value is approximately USD 25 million

Subdued US Market, Bears are the likely target

Bernake came into the resuce of the wall street after a down opening yesterday. The Fed chief re-iterated that inflation concerns will not stand in front of another rate cut. Dow Jones ended the day up 9 points at 12,694 and Nasdaq up 8.7 points at 2,353. This is the fourth consecutive positive closing for the Dow Jones while a hatrict for the Nasdaq. We are the first ones to report the Dow Jones forming a Medium term botton on Satruday morning IST.

Indian Markets are not able to latch on to the early gains built yesterday due to credit concerns and negative news flow from the Europe. When the big brother is able to withstand the negative news why the emerging market like India is looking at every oppurtunity to fall. It once again nails down to the huge short positions built up by the FII's for the Feb Series. There are reports in the market that shorts were rolled over to the March Series. We believe Budget will signal the end of the bearish saga haunting from the last 45 days.

Markets are likely to open in a subdued fashion only to pick up later in the day. Except a 200-300 point gain today on the BSE Sensex. Momentum Calls like OnMobile, KS Oils and McLeod Russel, Dhanus Tech tasted success while few others are on the way to reach targets. Subscribe to get the best value advice in the Indian markets.

We again re-iterate that fundamentals cannot be over shadowed for longer period and many stocks are still trading at attractive valuations. The hang over will be over soon and FM is likely to be the torch bearer for the next rally.

Stock in news - Dabur Pharma, Spice Jet, UTV Software, Shasun Chemicals and many more hit the headlines today.

Shasun Chemicals formed an exclusive deal with global pharma biggie Merck & Co thats allows the American company the use of Shasun’s proprietary technology to make bulk drugs.

ET reports that Dabur Pharma is looking out for a buyer and said to be in advanced stage talks with a renowned PE firm.

SpiceJet is likely to fly to gulf and china.

ABC news is likely to take stake in UTV news.

Sun Pharma gets USFDA nod to market generic demadex tablets.

BGR Energy Systems has won a BOP contract worth Rs 793 crore from the Andhra Pradesh Power Generation Corporation for a 500-MW coal-based project in Kothagudam.

Aries Agro is likely to increase capacity by five fold

Nagarjuna Constructions is actively looking for a foreign partner for getting into auxiliary equipment business, used in power plants.

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Markets look to open strong for the third day in a row as Bulls look to come back and regain some lost ground in the past few months. The global cues are good with the US markets ending up and Nikkei joining the gainers club
On the domestic front Reliance Industries Ltd announced that it discovered natural gas in Mahanadi and this will definitely reflect on the stock performance today. The overall sentiment in the market has started improving as we have seen some selective buying in some sectors like Tea which has underperformed the market for the past 12 months. The focus has now turned to Budget 2008 which is due on Friday, ignoring the upcoming F&O expiry. We strongly believe and are nearly certain that Agriculture (fertilizers in particular) and Textiles will be the two key sectors to watch out for in the upcoming budget.

Mid cap and Small cap indices which have underperformed the index for the last 6 sessions made a come back yesterday and are likely to outperform the large caps in the coming days. We see a gain of 1.5 to 2 percent on BSE today with selective buying in sectors which could gain from budget sops.

Stock in news - RIL, BHEL, Concor, Cairn India, Petronet LNG are Newsworthy stocks today.


Reliance Finds Natural Gas in Mahanadi Basin.Reliance owns 90 percent in the area and Canada's Niko Resources Ltd. holds 10 percent of the area

Bharat Heavy Electricals Ltd won a $269 million) order for a power project in Gujarat from Gujarat State Energy Generation Ltd for a 350-megawatt turbine-based plant that will be located at Hariza.

Container Corporation of India (Concor) is all set to add eight new rail-linked inland container depots) with an investment of Rs 320 crore by the end of 2009

Cairn India has entered the race for acquiring two oil exploration blocks in Sri Lanka, by bidding for blocks 001 and 002 under the ongoing Sri Lankan licensing round.

Asian Development Bank is likely to exit Petronet LNG Ltd by selling its 5.2 per cent holding in the country's biggest liquefied natural gas importer possibly to promoters or billionaire Lakshmi Mittal.