|A daily wrap up on the market, which will keep you updated on what happened in the day and what to expect & news to watch out for the next trading session
Markets take a breather-Finally
After a hectic rally over the past few days, markets finally looked to consolidate today. Several stocks that had scaled new highs in the recent past came under profit booking pressure today namely, SUNPHARMA (-3.30%), LUPIN (-0.86%), HDFC (-0.90%). On the back of robust results from PNB (+4.70%), the BSE BANKEX (-0.33%) made attempts to bounce back from the lows of the day, however, it was dragged down by other large counters such as AXIS BANK (-2.27%), HDFC BANK (-0.90%), KOTAK MAHIMDRA BANK (-0.45%) among others. However, PNB’s results enthused buying in other PSU banks such as BANK OF INDIA (+2.43%), SBI (+1.88%), UNION BANK (+1.44%) and others. Among the broader indices, BSE IT (+0.87%) was up the most on the back of encouraging results and growth guidance from COGNIZANT TECHNOLOGY SOLUTIONS (CTS). CTS has guided for 17% growth versus Nasscom’s industry guidance of 12% – 14%. BSE HEALTHCARE (-1.62%) lost the most among broader indices as all major pharma companies came under heavy profit booking. SENSEX and NIFTY shed 0.26% and 0.32% respectively with SENSEX closing below the 20,000 mark that it had scaled yesterday. Today’s fall may not necessarily be a direction reversal. Markets may simply be taking a breather after 10% rally over the past 1 month. FIIs too have been relentlessly pouring in money into Indian equities. Till they keep doing so the direction will remain upwards. A lot depends on macro-economic data which has been mixed so far. Tomorrow will be a crucial session as we have IIP announcement for March, 2013. Bloomberg estimates point to a 2.4% growth versus 0.6% growth in February, 2013.
Just like in India, even Asian markets came under heavy profit booking. SHANGHAI COMPOSITE & HANG SENG closed lower by 0.59% and 0.14% respectively. China’s CPI came in at 2.4% for April, 2013 versus Bloomberg estimates of 2.3% adding to concerns that the Government would attempt to slow growth. However, inflation is still way below Government’s target of 3.5%, hence scope for further stimulus remains. NIKKEI too lost 0.66% after its recent multi-year high run-up. However, the rally could be far from over for Japanese stocks since the Bank of Japan is expected to announce more stimulus in the later part of this year.
Nifty ended in the red after several days of advance losing 19 points at 6050. It has managed to give a close above the 80% FR of the entire decline of 6111 till 5477 but now has a trend line resistance placed at 6080 and beyond that there is a resistance in the form of the swing high of 6111. Only if it manages to sustain above 6111 there may be a possibility of a further upside till 6200 to 6250 range.
On the downside it has support placed at 6000. As long as it manages to sustain above 6000 the trend would remain up but on a breach of 6000 it may succumb to selling pressure and come down till 5930 and below that 5850 is possibility