Thursday, November 6, 2008
Sensex falls again
EVEN as central banks continued to unveil rate cuts to boost liquidity into the system, equity investors across Asia and Europe dumped stocks on concerns over corporate earnings. Toyota Motor, the world’s secondlargest automobile firm, warned of the biggest drop in profit in at least 18 years, due to a combination of weak demand and strong yen. Indian equity benchmarks fell 3-4%, but fared better than Asian peers like Hong Kong, Japan, South Korea and Taiwan, which were down 5-7%. Key European markets fell despite rate cuts announced by the Bank of England and the European Central Bank. The Bank of England on Thursday unexpectedly lowered its key rate by 1.5 percentage points to 3%, the lowest rate since 1955. ECB slashed its key rate by 50 basis points to 3.25% — the second cut in less than a month — while rate cuts were announced by the Czech and Swiss central banks too. ECB President Jean-Claude Trichet did not rule out a further reduction in interest rates, saying the global financial crisis could lead to an extended economic slump. The 30-share Sensex ended the day at 9,734.22, down 385.79 points over the previous close. The 50-share Nifty closed at 2892.65, down 92.30 points. Traded turnover was slightly better, compared with the early part of the week. Close to Rs 58,000 crore worth of shares and equity derivatives were traded on both exchanges combined. However, foreign institutional investors continued to press sales. As per provisional data, FIIs net sold Rs 511 crore worth of shares on Thursday. Domestic institutions seem to have resumed their buying activity, mopping up shares worth over Rs 350 crore. “The consensus forward P/E slipped into the single digit territory — a level below, which it has not spent much time ever in the past. Most unbelievably, trailing price-tobook has collapsed to within 10% of the lowest levels seen since at least 1995,” said a strategy note by broking house Credit Suisse. “The market has come to a point where long-term, value investors that are not interested in timing the bottom should begin to invest heavily,” the note added. Metal shares took a pounding, and was the worst-performing sector, with the BSE Metal index shedding over 8%. Realty shares were the best performing sector, with the BSE Realty Index ending around 1% higher than the previous close.
Choppy session Inflated/deflated
The domestic indices opened on a weak note amidst
negative global cues and traded below the previous close
for larger part of the trading session. While in the
penultimate hour of trade, they managed to swing towards
the previous close led by intensified buying activity at
lower levels. However, this momentum was short-lived
as in the final trading hour the markets gave up all the
gains to close deep into the red. On hourly chart, Nifty is
trading within a falling channel and is expected to touch
the lower line of the channel placed at 2,775. On upper
end, Nifty is having resistances of 20 HSMA and 40 HEMA,
which are placed at 2,954 and 3,019 respectively. The
daily momentum indicator is trading sideways. The overall
market breadth was negative with the losers outnumbering
the gainers.
On hourly chart, the momentum indicator KST is still riding
its negative crossover and has also breached the zero
line. Our short-term bias is still down for the target of
2,750 with reversal packed at 3,250. However our midterm
bias is still up for the target of 3,450 with reversal
nailed at 2,650.
The Sensex and Nifty both ended with a loss of 385 and
102 points respectively. Among the 13 sectors of the
Sensex, realty and health care were the only sectors that
ended in the green, while all other sectors ended in the
red with metal and oil & gas sectors leading the party.
Among the 30 stocks of the Sensex Jaiprakash Associates
and Hindustan Unilever led the pack of gainers while Tata
Steel and Tata Motors led the bunch of losers.
negative global cues and traded below the previous close
for larger part of the trading session. While in the
penultimate hour of trade, they managed to swing towards
the previous close led by intensified buying activity at
lower levels. However, this momentum was short-lived
as in the final trading hour the markets gave up all the
gains to close deep into the red. On hourly chart, Nifty is
trading within a falling channel and is expected to touch
the lower line of the channel placed at 2,775. On upper
end, Nifty is having resistances of 20 HSMA and 40 HEMA,
which are placed at 2,954 and 3,019 respectively. The
daily momentum indicator is trading sideways. The overall
market breadth was negative with the losers outnumbering
the gainers.
On hourly chart, the momentum indicator KST is still riding
its negative crossover and has also breached the zero
line. Our short-term bias is still down for the target of
2,750 with reversal packed at 3,250. However our midterm
bias is still up for the target of 3,450 with reversal
nailed at 2,650.
The Sensex and Nifty both ended with a loss of 385 and
102 points respectively. Among the 13 sectors of the
Sensex, realty and health care were the only sectors that
ended in the green, while all other sectors ended in the
red with metal and oil & gas sectors leading the party.
Among the 30 stocks of the Sensex Jaiprakash Associates
and Hindustan Unilever led the pack of gainers while Tata
Steel and Tata Motors led the bunch of losers.
Bears Play Show Stoppers
After positive opening, the markets were unable to hold
on to their opening gains and slid into the negative
territory in the initial hour of trade. The southward journey
continued till the final hour of trade, which pushed the
indices deep in the red. On daily candlestick chart, the
Sensex has formed a bearish engulfing pattern, which
shows that bears will have an upper hand over the bulls,
with today’s high as a dominant hurdle. Further,
yesterday’s close of the index above 20 DSMA has turned
out to be a whipsaw as today Index has again slipped
below that average, which further adds to the bearish
sentiments. Also on hourly chart, Nifty has breached the
neckline of head–and–shoulders pattern and is now
approaching towards its conservative and aggressive
targets that are placed at 2,925 and 2,875 respectively.
The daily momentum indicator KST has turned flat, yet it
has not given a negative crossover. Market breadth, which
was initially in the favour of the bulls slipped into the
favour of the bears as the day progressed.
On hourly chart, the momentum indicator KST is continuing
to ride its negative crossover. We have revised our shortterm
bias down for the target of 2,750 with the reversal
pegged at 3,250. However our mid-term bias is still up
for the target of 3,450 with the reversal nailed at 2,650.
The Sensex and Nifty both ended with a loss of 511 and
147 points respectively. All the 13 sectors of the BSE except
BSE HC ended in the red. Among the 30 stocks of Sensex
Wipro was the only stock that ended in green with a gain
of 2%, whereas Reliance Industries (-14%), Tata Steel
(-11%) and Reliance Communications (-10%) were the key
losers.
on to their opening gains and slid into the negative
territory in the initial hour of trade. The southward journey
continued till the final hour of trade, which pushed the
indices deep in the red. On daily candlestick chart, the
Sensex has formed a bearish engulfing pattern, which
shows that bears will have an upper hand over the bulls,
with today’s high as a dominant hurdle. Further,
yesterday’s close of the index above 20 DSMA has turned
out to be a whipsaw as today Index has again slipped
below that average, which further adds to the bearish
sentiments. Also on hourly chart, Nifty has breached the
neckline of head–and–shoulders pattern and is now
approaching towards its conservative and aggressive
targets that are placed at 2,925 and 2,875 respectively.
The daily momentum indicator KST has turned flat, yet it
has not given a negative crossover. Market breadth, which
was initially in the favour of the bulls slipped into the
favour of the bears as the day progressed.
On hourly chart, the momentum indicator KST is continuing
to ride its negative crossover. We have revised our shortterm
bias down for the target of 2,750 with the reversal
pegged at 3,250. However our mid-term bias is still up
for the target of 3,450 with the reversal nailed at 2,650.
The Sensex and Nifty both ended with a loss of 511 and
147 points respectively. All the 13 sectors of the BSE except
BSE HC ended in the red. Among the 30 stocks of Sensex
Wipro was the only stock that ended in green with a gain
of 2%, whereas Reliance Industries (-14%), Tata Steel
(-11%) and Reliance Communications (-10%) were the key
losers.
Sensex loses 511 points
MAIN street may be ecstatic at Barack Obama’s victory in the US Presidential race, but Wall Street and European markets don’t see any reason to cheer. The Dow Jones Industrial Average and the Nasdaq were down nearly 2% in early trade while key European markets fell 2-3%, as investors appear more worried about a global slowdown. Back home, a 13% decline in Reliance Industries pushed down equity benchmarks by over 5%, causing India to underperform its Asian peers.
The BSE 30-share Sensex snapped a five-day winning streak to end with a 511-point, or 4.8%, loss at 10,120. The index had rallied more than 2,000 points in the past five consecutive sessions. The NSE Nifty closed 147 points, or 4.7%, down at 2,995 on Wednesday.
The weak sentiment in India was attributed to many factors. There are fears that outsourcing from the US to India may be affected after Obama is elected as the US president. The newly-elected president is apparently against outsourcing, going by his statements in his election speeches. However, IT stocks were among the better-performing sectors. Oil and gas stocks bore the brunt of Wednesday’s sell-off as the BSE Oil & Gas index tanked 637 points, or 9.4%, to 6,112.
The BSE 30-share Sensex snapped a five-day winning streak to end with a 511-point, or 4.8%, loss at 10,120. The index had rallied more than 2,000 points in the past five consecutive sessions. The NSE Nifty closed 147 points, or 4.7%, down at 2,995 on Wednesday.
The weak sentiment in India was attributed to many factors. There are fears that outsourcing from the US to India may be affected after Obama is elected as the US president. The newly-elected president is apparently against outsourcing, going by his statements in his election speeches. However, IT stocks were among the better-performing sectors. Oil and gas stocks bore the brunt of Wednesday’s sell-off as the BSE Oil & Gas index tanked 637 points, or 9.4%, to 6,112.
Tuesday, November 4, 2008
Nifty Resistance @ 3100
The market today has opened flat with a bit of follow-up
selling. The Nifty is forming an inverted head-and-shoulder
pattern, which has a neckline at 3100. The pattern is now
on its way to forming its right shoulder, which has support
around 2850. On the daily charts, the index has strong
resistance at 20-DMA and 40-DMA, ie 3140 and 3470
respectively. The market breadth is positive with 710
advances and 415 declines. The daily momentum indicator
has given a positive crossover. On the daily charts, support
at 2850 and strong resistance at 3100 are indicated.
On the hourly charts, the momentum indicator has given
a negative crossover. We expect the momentum to be
negative for the day. Support at 2970 and a very strong
resistance at 3100 are indicated on the hourly charts.
Of the 30 stocks in the Sensex, State Bank (up 3.60%) and
Aban Offshore (up 5%) are the top gainers. 3i Infotech is
likely to test Rs53 on the upside and has strong support at
Rs43. Among the sectors, the banking sector has gained
momentum and is expected to move upward.
selling. The Nifty is forming an inverted head-and-shoulder
pattern, which has a neckline at 3100. The pattern is now
on its way to forming its right shoulder, which has support
around 2850. On the daily charts, the index has strong
resistance at 20-DMA and 40-DMA, ie 3140 and 3470
respectively. The market breadth is positive with 710
advances and 415 declines. The daily momentum indicator
has given a positive crossover. On the daily charts, support
at 2850 and strong resistance at 3100 are indicated.
On the hourly charts, the momentum indicator has given
a negative crossover. We expect the momentum to be
negative for the day. Support at 2970 and a very strong
resistance at 3100 are indicated on the hourly charts.
Of the 30 stocks in the Sensex, State Bank (up 3.60%) and
Aban Offshore (up 5%) are the top gainers. 3i Infotech is
likely to test Rs53 on the upside and has strong support at
Rs43. Among the sectors, the banking sector has gained
momentum and is expected to move upward.
Sensex above 10k
THE slew of policy measures announced by RBI on Saturday had a positive impact on the market. Combined with positives cues from Asian markets, equity benchmarks extended their winning streak on Monday, closing above psychological levels, but most market participants are viewing it as nothing more than a relief rally. Provisional data showed foreign institutional investors as being net buyers for the second day in a row. However, given the gloomy mood — both in the domestic economy as well as globally — it remains to be seen if these inflows can sustain long enough for the indices to climb back to respectable levels. It is too early to say if mutual fund inflows are tapering off, though there are signs that local investors’ patience is wearing thin. FIIs net bought Rs 363 crore worth of shares, while domestic institutions were net sellers of Rs 97 crore of shares.
Also, Monday’s gains have to be viewed in the context of combined traded turnover, which was around Rs 48,000 crore. Traded turnover in the derivatives segment was less than Rs 35,000 crore, an unusually low figure for the early part of a settlement cycle. The 30-share Sensex closed above 10,000 for the first time in nearly two weeks, rising 549.62 or nearly 6% to close at 10,337.68. The 50-share Nifty closed above 3000, gaining 158.25 points to end the day at 3043.85.
In the currency market, RBI’s move of easing rates last week made an impact, as the rupee fell below 49 to the dollar and call rates cooled down to around 7%. RBI cut the key repo rate by 50 basis points and reduced CRR and SLR by 100 basis points each on Saturday. Its primary aim was to improve liquidity though the impact on the equity market has been positive, at least in the short run.
India was the best performer among key Asian markets. Hong Kong, South Korea, Taiwan and Singapore were up between 1% and 5% while Japan was an exception to the trend, shedding 5%. European markets were mixed, with the European Commission stating that the region’s economy may have already entered a recession this year, and predicting that it would stagnate in 2009. And the steep plunge in commodity prices has led many analysts to forecast that the US may be headed for its longest recession in over two and a half decades.
There were positive developments though, as the three-month London inter bank offered rate (Libor) — the cost of borrowing in dollars in London — fell on hopes of further rate cuts by the European Central Bank. The three-month Libor rate fell to a one and a half month low of 2.86%.
Back home, realty stocks were the star performers, with the BSE Realty index shooting up over 8% to close at 2142. Brokers continued to remain sceptical on the sector though as companies are facing a severe cash crunch, prompting many of them to go slow on new projects and reduce prices in case of already developed projects.
Other strong performers included capital goods and banking sectors. Infrastructure firms L&T and Jaiprakash Associates were up 10-13% while SBI surged 12%.
Also, Monday’s gains have to be viewed in the context of combined traded turnover, which was around Rs 48,000 crore. Traded turnover in the derivatives segment was less than Rs 35,000 crore, an unusually low figure for the early part of a settlement cycle. The 30-share Sensex closed above 10,000 for the first time in nearly two weeks, rising 549.62 or nearly 6% to close at 10,337.68. The 50-share Nifty closed above 3000, gaining 158.25 points to end the day at 3043.85.
In the currency market, RBI’s move of easing rates last week made an impact, as the rupee fell below 49 to the dollar and call rates cooled down to around 7%. RBI cut the key repo rate by 50 basis points and reduced CRR and SLR by 100 basis points each on Saturday. Its primary aim was to improve liquidity though the impact on the equity market has been positive, at least in the short run.
India was the best performer among key Asian markets. Hong Kong, South Korea, Taiwan and Singapore were up between 1% and 5% while Japan was an exception to the trend, shedding 5%. European markets were mixed, with the European Commission stating that the region’s economy may have already entered a recession this year, and predicting that it would stagnate in 2009. And the steep plunge in commodity prices has led many analysts to forecast that the US may be headed for its longest recession in over two and a half decades.
There were positive developments though, as the three-month London inter bank offered rate (Libor) — the cost of borrowing in dollars in London — fell on hopes of further rate cuts by the European Central Bank. The three-month Libor rate fell to a one and a half month low of 2.86%.
Back home, realty stocks were the star performers, with the BSE Realty index shooting up over 8% to close at 2142. Brokers continued to remain sceptical on the sector though as companies are facing a severe cash crunch, prompting many of them to go slow on new projects and reduce prices in case of already developed projects.
Other strong performers included capital goods and banking sectors. Infrastructure firms L&T and Jaiprakash Associates were up 10-13% while SBI surged 12%.
Monday, November 3, 2008
Today Support @ 2846
Market today has opened gaped up. Nifty is now trading
above the 40 HMA i.e. 2846 levels, which is a strong
support. On the daily charts, the index has strong resistance
at 20 DMA and 40 DMA i.e. 3150 and 3990 respectively. We
expect momentum to be positive for the day. Market
breadth is positive with 1053 advances and 143 declines.
Daily momentum indicator has given a positive crossover.
On the daily charts, support at 2850 and strong resistance
at 3150.
On hourly charts, Nifty has Inverted Head & Shoulder, which
had it’s neckline at 2920 and has also broken out of the
pattern for the target of 3600, which is a strong sign going
forward. Support at 2900 and a very strong resistance at
3050 on hourly charts.
Of the 30 stocks of the Sensex, Reliance (up 4%) and
Punj Lloyd (up 9%) are the top gainers. TCS is likely to test
Rs520 on the downside and has strong resistance at Rs570.
Among the sectors, Metal sector have gained momentum,
and expected to move downward
above the 40 HMA i.e. 2846 levels, which is a strong
support. On the daily charts, the index has strong resistance
at 20 DMA and 40 DMA i.e. 3150 and 3990 respectively. We
expect momentum to be positive for the day. Market
breadth is positive with 1053 advances and 143 declines.
Daily momentum indicator has given a positive crossover.
On the daily charts, support at 2850 and strong resistance
at 3150.
On hourly charts, Nifty has Inverted Head & Shoulder, which
had it’s neckline at 2920 and has also broken out of the
pattern for the target of 3600, which is a strong sign going
forward. Support at 2900 and a very strong resistance at
3050 on hourly charts.
Of the 30 stocks of the Sensex, Reliance (up 4%) and
Punj Lloyd (up 9%) are the top gainers. TCS is likely to test
Rs520 on the downside and has strong resistance at Rs570.
Among the sectors, Metal sector have gained momentum,
and expected to move downward
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