Sun 31st: Where are the Good News…

Minning Scam, CWG, 2G etc etc….. Inflation, rising int rate, so where is the good news that the markets were surging till now. Only the FII’s inflow can change the Indian markets outlook.

Moody’s cut Greece’s rating by three notches to Ca, just one notch above default to reflect the expected loss implied by the proposed debt exchanges. It is the 2^nd rating agency to warn of a default after euro zone leaders and banks agree last week that the procreate sector would shoulder part of the burden of a rescue deal that offers Greece more cash and easier loan terms to keep it afloat and avoid further contagion.

Practically blaming the government for not doing enough, the Reserve Bank of India (RBI) on Tuesday decided to go all guns blazing to subdue persistently high inflation. The Reserve Bank of India (RBI) on Tuesday increased its inflation prediction for end-March 2012 and credit growth forecast while retaining its GDP growth projection even as it stunned the markets with a 50 basis-point (bps) hike in policy rates. The central bank now sees inflation at 7% by the end of March next year as opposed to 6% earlier. The GDP growth projection stays unchanged at 8%. Repo rate under the liquidity adjustment facility (LAF) is up by 50 basis points from 7.5 per cent to 8.0 per cent with immediate effect. The Bank Rate has been retained at 6.0 per cent.

The Rupee rose to an almost three year high against the US Dollar on Wednesday, expecting a rise in fund flows due to higher interest rates compared with the US where the Fed is holding policy rates near zero. The US Dollar, the global currency for trade, hit a new low against the currencies of Australia and New Zealand and also Swiss Franc. The Canadian dollar and the Japanese yen have also been rising against the green back.

Once again the Indian Markets closed below the 5500 levels. Indices shrinked more that 2.5% in a week. Midcap Index too closed down 1.7%. Reality Index was the major looser which lost nearly 8%. Metals tanked 5% and Auto Index closed down 1.2%. There are stocks which have impacted by their Quarterly results. Bhel tanked post results by 7%. Kotak Bank closed down 9%. Rel Infra by 7%, IDFC & JP Ass by 11%. Jspl, Voltas, Glenmark Pharma & Marico all close down in the range of 5-7%. Adani was one of the major looser which lost nearly 19% after the news broke out that the Company might have been benefited by illegal mining in Karnataka. Godrej Ind lost 10%.

On the other side Maruti closed in green with gains of 4%, Axis Bank 3%, Acc & Bajaj Auto 1.5%. Hexaware closed with a gain of 8.5% and Nav Bharat 6.5%. On the Midcap side Madras Cement gained 10%, HSIL 22%, Dcm Shriram 20% and EIH Associate 18%

As mentioned in my earlier article also that the Nifty chart pattern shows some weakness and the markets above 5700 only will prove to be in a bullish zone. But the Nifty once again tanked and once again we are at 5500 levels. Nifty closed below its 50DMA. In the chart we can clearly see that the Inverted Head and Shoulder pattern was formed but it failed to close above the neckline and so it tanked. In my earlier article I had mentioned about the instability of the Indian markets, as there was no good reason or fundamental change in the Indian markets to get pulled up from 5200 to 5700 levels. That was just because of the FII flows.

In the chart we can see that the Nifty tried crossing the 38.2% retracement levels but failed to do that for a consecutive days and collapsed to take support only at its 23.6% levels. Close below the same will take the Nifty to 5300 levels.

Markets will turn bullish only when it closes above the 5800 levels. Till the time its better to be on the sideline or play with the volatility.

Monday, Jul 25 - Morning brief for the stock market

Stocks To Watch: RIL, JB Chemicals, Balrampur Chini, Kingfisher

Monday, Jul 25 - Morning brief for the stock market:

.

BIG PICTURE

* DIPP mulls further revision of WPI base year to 2010-11 from 2004-05 (FE)

TOP EVENTS TODAY

* Nifty companies detailing Apr-Jun earnings:

+ NTPC (net profit seen at 21.16 bln rupees, up 15% on year)

+ Reliance Industries (net profit seen at 57.6 bln rupees, up 19% on year)

+ Sterlite Industries (net profit seen at 15.5 bln rupees, up 53% on year)

* Apr-Jun earnings to be detailed by: Balaji Amines, Bank of India, Bank of Maharashtra, Easun Reyrolle, Edserv Softsystems, Chemplast Sanmar, Coromandel Engineering, Dhanlaxmi Bank, Edelweiss Capital, Energy Development Co, Geometric, GI Engineering Solutions, Graphite India, HeidelbergCement India, HSIL, Indbank Merchant Banking Services, India Gelatine & Chemicals, Jindal Cotex, JMD Telefilms, Jyoti Structures, Mastek, Oriental Bank of Commerce, Patni Computer Systems, Peninsula Land, S.E. Investments, SIL Investments, Supreme Industries, Visaka Industries, VLS Finance, Welspun Projects, Zee News, Zenith Exports.

* Annual General Meet of: Chemplast Sanmar, Coromandel Engineering Co, Edelweiss Capital, Geometric, Graphite India, JSW Steel, JB Chemicals & Pharmaceuticals, Jyoti Structures, Mahindra Holidays & Resorts India, Money Matters Financial Services, NHC Foods, Nicco Parks & Resorts, Krishna Ventures, Rajratan Global Wire, V-Guard Industries, Visaka Industries, Zee News.

INDICATORS (previous session)

* NSE provisional net buy/(sale) in bln rupees, Jul 22: FII 4.45, DII 2.43

* Institutional net buy/(sale) in bln rupees, Jul 21: FIIs (1.72), MF 2.06

* FII NSE futures net buy/(sale) in bln rupee, Jul 22: index 6.41, shr 0.97

* Sensex 18722.30, up 286.11 points; Nifty 5633.95, up 92.35 points

* Crude: $99.87/bbl; Rupee: 44.35/$1; Gold: $1,601.3/ounce; 10-yr yld: 8.3142%

WEEKLY SECTORAL OUTLOOK

* AUTO:

* BANKS: Firm; RBI policy action may weigh on sentiment.

* CAPITAL GOODS: Rangebound; BHEL, Siemens earnings eyed.

* CEMENT:

* FMCG:

* IT: Rangebound; HCL Technologies in focus.

* OIL:

* PHARMACEUTICALS:

* STEEL:

* TELECOM:

OUTLOOK

* Local share indices are seen opening weak, trailing Asian markets, on concerns over a likely debt default in the US as the nation's lawmakers failed to reach a deal on raising its debt ceiling over the weekend.

.

GLOBAL STOCK MARKETS

* US: Indices ended up on Friday as strong corporate earnings lifted sentiment.

* ASIA: Equities were weak today as US lawmakers failed to come to a debt deal over the weekend, raising concerns that the nation will be unable to raise its $14.3 trln debt ceiling by Aug 2.

SECTOR NEWS

* AUTOMOBILE: Volvo to introduce corporate luxury sedans in India next year. (BS)

* AVIATION: Air India Chairman Arvind Jadhav said lack of direction and procedural delays hurting the carrier. (FE, Sat)

Air India looking at the sale and leaseback route to acquire 27 Boeing 787 planes in order to cut its debt. (Mint)

The Board of Reconstruction of Public Sector Enterprises plans to bring Air India under its wing. (Mint)

* BANKING: Deutsche Bank set to appoint Anshu Jain as co-CEO. (ET)

* COMMODITIES: Allegations of chemical contamination in rapeseed meal and soymeal exports to China threaten to affect India's exports worth 6 bln rupees

* DEFENCE: Foreign Investment Promotion Board says non-defence foreign companies can invest in the sector up to the 26% sectoral foreign direct investment cap. (FE

* ENERGY: Shut down of about 50 iron ore mines in Karnataka to hit supplies to steel companies. (ET)

Rashtriya Ispat Nigam set to get approval from the government to mine iron ore in Bhilwara, Rajasthan. (ET)

Coal ministry likely to make norms more stringent for bidding for new blocks. (BS)

* ENVIRONMENT: Prime Minister Manmohan Singh says to soon form national environment body to grant industry clearances. (FE)

* FMCG: L'Oreal SA plans to invest 5 bln rupees to expand its operations in India. (ET)

* GEMS & JEWELLERY: The domestic industry is likely to touch 2.13 trln rupees by 2015, according to a study by Assocham. (BL, Sat)

* GOVERNMENT: The government will buy back around 70 bln rupees of fertiliser bonds Jul 22-29.

Finance Minister Pranab Mukherjee is to meet corporate bigwigs on Aug 1 to allay fears on reforms and growth. (ET, Sat)

The finance ministry is exploring the option of introducing tax deducted at source or TDS in the service sector to stem tax evasion. (ET, Sat)

* INSURANCE: The Insurance Regulatory and Development Authority may set a timeline for life insurance companies to list their shares. (var, Sat)

* INVESTMENT: Future Ventures has acquired additional 30% stake in Amar Chitra Katha, taking its stake in the company to 56%.

* MEDIA: UTV's broadcasting arm UTV Entertainment Television set to launch a Bollywood entertainment channel in mid-August. (BS)

* OIL: Government has said India is yet to officially hear from Iran on stopping crude oil supplies if the dispute over payments remains unresolved. (

* PORTS: Chennai Port Trust is likely to move coal and iron ore to the nearby Ennore port following a directive from Madras High Court. (BL, Sat)

* POWER: Nuclear Power Corp is in talks with consortium of 12 European banks to raise 4 bln euros ($5.7 bln) to fund its proposed 10,000 MW nuclear power plant at Jaitapur in Maharashtra. (FE, Sat)

Power ministry has begun a process to review the existing competitive tariff bidding guidelines. (FE)

Companies looking to set up plants in special economic zones may be exempted from the positive net foreign exchange norm. (BL)

* PRIVATE EQUITY: IDFC Private Equity has invested 1.5 bln rupees in GVR Infra Projects.

* REAL ESTATE: The draft of new land acquisition bill has proposed a higher 20% stake for the farmers from the sale of acquired land. (ET)
Emami Group and Sheth Developers to jointly develop residential complex at Dadar in Mumbai; total investment seen at over 1 bln rupees. (ET)

* REGULATORY: Foreign institutional investors' pre-earnings buying spree under SEBI lens. (PTI)

* RETAIL: A Committee of Secretaries has approved a proposal to allow 51% foreign direct investment in multi-brand retail.

Future Group has sought tie-ups for home retail and electronics business. (CNBC-TV18)

Slowdown in volume growth, margin pressure, and falling consumer discretionary spending likely to weigh on Apr-Jun earnings of the companies. (FE)

* TAX: Finance ministry to soon announce new accounting regime for taxation purposes. (FE)

* TELECOMMUNICATION: The Telecom Commission has recommended a scheme for creating National Optical Fibre Network--costing 200 bln rupees—for providing broadband connectivity to panchayats

The Telecom Regulatory Authority of India may bring the 120-bln-rupee

mobile value added service market under its regulation. (FE, Sat)

Kapil Sibal says 2G spectrum scandal a result of internal intense rivalry among the companies in the sector; government functioning under shadow of fear. (ET)

Department of Telecommunications may allow spectrum sharing among operators. (DNA)

STOCKS

* AKZO NOBEL INDIA: Is planning its biggest paint plant in India, make an acquisition, and will tap the mid-market segment for faster growth. (DNA, Sat)

* APOLLO HOSPITALS ENTERPRISE: To invest 16 bln rupees to add 3,000 beds in next three years. (BS, Sat)

* ASHOK LEYLAND: Joint venture with Nissan Motor Co has started production of its first light commercial vehicle, Dost.

* AXIS BANK: May consider raising Tier-I capital in 2012 and has sought modifications to the in-principle approval given by Reserve Bank of India for acquiring Enam Securities.

* BALRAMPUR CHINI MILLS: Posts net loss of 198.6 mln rupees in Apr-Jun, compared with a net profit of 111.3 mln rupees last year.
To draw up major expansion plans on deregulation of the industry. (DNA)

* BHARTI AIRTEL: Has raised call charges by 20% in some circles due to falling margins and high 3G auction bids.

* CADILA HEALTHCARE: In talks to acquire brands and manufacturing facility of Biochem Pharmaceuticals for around 3.0-4.5 bln rupees. (ET)

* CANARA BANK: May hire 3,000 personnel in 2011-12. (BL, Sat)

* COAL INDIA: Has said that delay in receipt of environmental clearance for mining projects has stalled investment decision on 67 new projects and delayed expansion of ongoing projects. (ET, Sat)

* CONTAINER CORP OF INDIA: Plans to start ocean freight carrier service along with TRANSPORT CORP OF INDIA. Will start trial operations for non-vessel operating common carrier service in six months on India-Singapore route. (DNA, Sat)

* CROMPTON GREAVES: HDFC MF ups stake in the company to 5.77% from 4.76%

* EMAMI: Group company Emami Biotech to invest 5.5 bln rupees to expand edible oil refinery capacity in next two years. (BL, Sat)

* GATEWAY DISTRIPARKS: Apr-Jun net profit rises 46.6% on year to 222.87 mln rupees; net sales soars 60.5% to 601.19 mln rupees.

* GODREJ CONSUMER PRODUCTS: Apr-Jun consolidated net profit up 94% on year at 2.39 bln rupees on strong local and global sales, and recent acquisitions. (

* HERITAGE FOODS INDIA: Has tied up with State Bank of Hyderabad for dairy loans; the collaboration will provide assured supply of milk to company. (BL, Sat)

* ICICI BANK: Has raised rates on some deposits by 25-75 basis points.

* INFOSYS: California-based Union bank has cancelled a $20 mln contract with Infosys to implement its core banking software product Finacle. (FE, Sat)

* IRB INFRASTRUCTURE: Says search conducted by the Income tax authorities at the company's office, sites on Thu and Fri were routine.

* JB CHEMICALS & PHARMACEUTICALS: Will fully exit Russia and Commonwealth of Independent States countries after it sold its prescription drugs business in the region to Dr Reddy's Laboratories for 1.37 bln rupees.

* JSW ENERGY: Plans to add 1,100 MW power generation capacity in 2011-12, which will take its total capacity to 3140 MW. (FE, Sat)

* JSW STEEL: Embarks upon a complete restructuring programme for ISPAT INDUSTRIES. (FC)

* KINGFISHER AIRLINES: The Airports Authority of India may consider issuing notices to the company for non-payment of airport charges worth 2 bln rupees. (PTI)

* LARSEN & TOUBRO: Has decided to close its Chinese subsidiary L&T Wuxi due to falling volumes, rising wages, and cultural differences. (FE)

* LML: The scooter manufacturer expects to re-enter western and eastern India markets by 2011 end and will reach southern market by 2013. (BL, Sat)

* MMTC: Has floated tender to export up to 60,000 tn pig iron in Aug-Sep.

* NIIT: Apr-Jun consolidated profit after tax has risen marginally from last year to 131 mln rupees mainly due to high investments made during the quarter.

* NMDC: M.S. Rana set to be appointed as chairman and managing director of the company. (FE)

* NTPC: Power secretary has asked coal secretary to review de-allocation of five of NTPC's coal blocks and restore them to the company.

* OIL AND NATURAL GAS CORP: Plans to invest 260 bln rupees in putting 50 onshore and offshore fields on production, 49 through in-house efforts and one through service contract. (BS, Sat)

* RELIANCE INDUSTRIES: Government has cleared Reliance Industries-BP deal and will enforce provisions of output sharing contract.

Oil minister has said it can't speculate if KG-D6 output will go up by December.

The joint venture with Australian uranium mining major UXA Resources will begin drilling in the northern territory of Australia in next month. (HT, Sat)

Company has hired over 100 short-term managers for its retail, broadband, and core petrochemical businesses. (ET)

* RELIGARE ENTERPRISES: Investment banking arm Religare Capital Markets to acquire controlling stake in South Africa's Noah Financial Innovation for an undisclosed sum. (ET)

* RESURGERE MINES & MINERALS INDIA: To mull new mine acquisition offer Friday.

* SATYAM COMPUTER SERVICES: Defers salary increments to employees till October. (ET, Sat)

* SESA GOA: Has refuted allegations over an under-invoicing of exports and imports worth over 10 bln rupees. (PTI)

* SHARON BIO-MEDICINE: Dehradun unit has received Canada approval.

* SPICEJET: Is looking to raise funds via share sale. (ET)

* STATE BANK OF INDIA: SBI Life Insurance Apr-Jun net profit rises 26% on year to 1.4 bln rupees. (var)

* SUZLON ENERGY: Has offered to buy the remaining stake of 4.8% in REpower Systems AG for 142.77 euros a share.

* SYNDICATE BANK: Has sought bids for sale of Vertex Spinning's plant and property in Dhar district of Madhya Pradesh.

* TATA MOTORS: Has begun assembling commercial vehicles after it opened a 110-mln-rand CV assembly unit with a capacity 3,650 vehicles/year in South Africa in a joint venture.

Has cut its net debt by 21% to 241.80 bln rupees in 2010-11. (var)

* TATA STEEL: Plans to invest in last-mile rail connectivity and building specially designed wagons. (BL, Sat)

* UNION BANK OF INDIA: Hikes BPLR by 25 bps to 14.5% from today.

* WIPRO: To draw out plans to provide IT services to seeds, fertiliser, agro-chemical bio pharmaceutical, and commodity companies. (FE)

Sun: 24th July

There has been very little to about the Indian markets this week. After a volatile session Nifty gained mere 0.9% while Sensex closed with a gain of 0.8% only. Once again Nifty closed above 5600 levels after making a low of 5532 Nifty once again gained on the last day of the week and some how managed itself to close above 5600 levels.

But Midcap and the Small caps were the flavor of the week. Praj ind gained nearly 26%. Petronet lng gained 20% after the announcement of its Quarterly result. Gspl rose nearly 16%. Ruby Mills was the major gainers in the small cap stocks which gained more than 45%, Sterling hotels closed above with a gain of 38% while Kothari Produts gained 30%.

There were some gainers in the Frontline stocks also. Gail and Bharti were the gainers with 4.5% higher closed then its previous close. Infosys gained nearly 4.4% which helped the IT Index close higher by 1.2%. Tata Power closed higher by 3.8% while Sterlite by 3.7%. Allahbad Bank gained 4.5% and Yes bank 3.2%. Pfous was another gainers in the midcap stocks which closed higher by 7.5%/.

On the losers side Tata motors lost 3.6%, Ntpc closed down 3.5%. rally in the Telecom stocks on the last day of the week could not help Rcom stocks to recover its lost glory and it closed down 2.5% while most of the telecom stocks gained more that 4-5% on the last day of the week. Wipro was the only looser in the IT stocks which closed down by 2.16%.

Nifty after its recovery from its Head and Shoulder Pattern is still not sure of the way to go in. FII and DII activities have been very less in the India markets. Indices gained mere 1% in a week. In the chart we can clearly see that the after the recovery from the Head and Shoulder pattern, a similar kind of pattern is in the formation, but an inverted one. Yes an Inverted Head and Shoulder pattern is under formation. But the breakout above 5740 will only confirm the same. In the chart we can clearly see that the Nifty took support at its 50DMA and closed at 5634 levels. In the chart it is also noticed that Nifty took support at its 50% retracement levels and bounced back.

Nifty close below the 5532 levels could take the Nifty to 5400 levels and close above the 5740 levels will take the Nifty to 5800-5850 levels. At the higher side there is wide opening but the nervousness is still there in the markets as there are very few people interested in trading.

This weeks call

Buy Rel Cap above 610 SL 605.

Buy Lnt above 1830 SL 1823.

Buy Yes Bank above 330 SL 326.

Buy Bajaj Auto above 1451 SL 1443.

Sun: 24th July

There has been very little to about the Indian markets this week. After a volatile session Nifty gained mere 0.9% while Sensex closed with a gain of 0.8% only. Once again Nifty closed above 5600 levels after making a low of 5532 Nifty once again gained on the last day of the week and some how managed itself to close above 5600 levels.

But Midcap and the Small caps were the flavor of the week. Praj ind gained nearly 26%. Petronet lng gained 20% after the announcement of its Quarterly result. Gspl rose nearly 16%. Ruby Mills was the major gainers in the small cap stocks which gained more than 45%, Sterling hotels closed above with a gain of 38% while Kothari Produts gained 30%.

There were some gainers in the Frontline stocks also. Gail and Bharti were the gainers with 4.5% higher closed then its previous close. Infosys gained nearly 4.4% which helped the IT Index close higher by 1.2%. Tata Power closed higher by 3.8% while Sterlite by 3.7%. Allahbad Bank gained 4.5% and Yes bank 3.2%. Pfous was another gainers in the midcap stocks which closed higher by 7.5%/.

On the losers side Tata motors lost 3.6%, Ntpc closed down 3.5%. rally in the Telecom stocks on the last day of the week could not help Rcom stocks to recover its lost glory and it closed down 2.5% while most of the telecom stocks gained more that 4-5% on the last day of the week. Wipro was the only looser in the IT stocks which closed down by 2.16%.

Nifty after its recovery from its Head and Shoulder Pattern is still not sure of the way to go in. FII and DII activities have been very less in the India markets. Indices gained mere 1% in a week. In the chart we can clearly see that the after the recovery from the Head and Shoulder pattern, a similar kind of pattern is in the formation, but an inverted one. Yes an Inverted Head and Shoulder pattern is under formation. But the breakout above 5740 will only confirm the same. In the chart we can clearly see that the Nifty took support at its 50DMA and closed at 5634 levels. In the chart it is also noticed that Nifty took support at its 50% retracement levels and bounced back.

Nifty close below the 5532 levels could take the Nifty to 5400 levels and close above the 5740 levels will take the Nifty to 5800-5850 levels. At the higher side there is wide opening but the nervousness is still there in the markets as there are very few people interested in trading.

This weeks call

Buy Rel Cap above 610 SL 605.

Buy Lnt above 1830 SL 1823.

Buy Yes Bank above 330 SL 326.

Buy Bajaj Auto above 1451 SL 1443.

Sun: 17th July 2011

The Industrial Production for the month of May 2011 grew by 5.6% slower than expected, the analyst were expecting a growth rate between 8% to 8.5%. The IIP growth for the period April-May was recorded 5.7% which was 10.8% for the same period last year. The Industrial Output for fiscal year April-March 2011 was 7.8% slower than the growth of 10.5% recorded in last fiscal. The IIP data today depicts a slow down in the manufacturing activity, on the backdrop of monetary tightening by the RBI to control Inflation.

Infosys Ltd. announced its Q1 FY2012 results this week (12 July 2012). The company’s top line increased 20.8% y-o-y to 7,485Crs while its bottom line rose 15.7% to 1,722Crs during the quarter compared with 1,488Crs in Q1 FY2011. On a sequential basis INFY reported a 3.2% q-o-q expansion in revenues while its net profits declined 5.3% sequentially.

The Nikkei suffered its biggest fall in the last month, slipped to below the level of 10,000, following a slump in financial stocks as worries about Europe's debt crisis. Selling of financial stocks were targeted because of concerns about the outlook for Italian banks after the cost of ensuring the country's debt jumped to the highest rate since the Euro was launched. The sector also fell following the similar stocks on Wall Street.

Inflation continued to be on the higher levels. Inflation for the month of June rose to 9.44% up from 9.06% in May. The inflation can be higher than that as the higher diesel prices are still not yet captured.

Silver have done a smart recovery in the commodities market. Silver bounced back from the low of Rs.50000 to make a high almost 58000. Punters betting heavily on the previous metals like Gold and Silver.

Equities market corrected in line with the international market. Debt pressure on the European countries triggered panic selling in the Indian markets also. But Nifty took support at its 50DMA and bounced back.

Sensex and Nifty corrected nearly 1.5%. Midcap Index closed down 0.7%. IT Index corrected the most 5.6%. Metals closed down 2.3%, Auto index 1.2%, Reality 1.8%, Bank Nifty closed down by 4.5%. Oil & gas gained 1.3%.

Amongst the stocs, Post Infosys results collapsed nearly 8.2%. JP ass lost 4%, Hero Honda 3.8%, Sail 4.1%, Hindalco 6.1%. In the gainers list PFC gained 3.69%, Dr.Reddy was up 4%, Spice Jet gained 14%, Supreme Ind 13%, Bajaj Fin 12%, Alstom 8%, Mpsteel 31%, Ocl Iron and Steel 18%, Ril ind close higher after a gain of 2%, Kotak 1.5%, Sesagoa 3%, Aanat raj Ind 11.50%, Dlf 3.2%. on the other hand Jagran Prakashan closed down 7.3%, Mundra life lost 38%.

In the chart we can clearly see that in the last week, Nifty took support at its 61.8% retracement levels at 5650 and then with the start of the week started its down ward movement with a gap down. From the high of 5740 made in the last week, nifty coutinue to fall to make a low of 5495. With FII’s flow on the positive side markets managed to be afloat. Nifty for the week closed at 5581 while Sensex closed at 18562 levels.

As mentioned in last week also the markets are heavy and we may continue to feel the pressure. Equity markets closed down nearly1.5% from its previous close. Nifty is finding it difficult to close above the 5600 levels. Few closes above the same can take the nifty to higher levels, but till that time the Nifty will fell the selling pressure. As I mentioned in my earlier article also that there was no change in the fundamentals of the India, then why did the markets bounced back from the low of 5200-5700 levels so fast. The reason was just FII’s inflow which triggered the buying streak.

Investors should wait for some more time to invest in the Indian markets till the time there is not stability. Stock specific movement will always be there.

Mon 11th: Nifty resistance 5750

Finally, after a long run up, Indian equity markets took some breather. Indices on the last day of the trading week, collapsed. Nifty tanked almost 70 points while Sensex ended with a loss of 220 points, but markets still closed up a bit from the last weeks close.

Nifty traded in a broad range of 5600-5750 levels. Nifty took support at 5600 levels and bounced back to make a high of 5737 odd. FII’s inflow kept the markets afloat. On the other hand DII’s were Net sellers for the week ended 07^th July 2011.

Next week, trade is expected to be choppy and action stock-specific as investors will keenly eye companies' Apr-Jun earnings. Sectors such as IT services, financials and materials have led the downward revision in Nifty earnings during the quarter (Apr-Jun). Although market participants expect the Nifty to trade in the broad range of 5600 and 5800, any strong disappointments on the earnings front could further drag the index to sub-5600 levels. Players believe that for the Nifty to see another rally, it must trade firmly above its 200-day moving average of 5750. Investors will eye the Apr-Jun results of index heavyweights Infosys and Tata Consultancy Services due on Tuesday and Thursday, respectively. Markets men expect Infosys to post a fall in consolidated net profit due to higher wage bill.

Metals stocks seems to be in focus and might be the target to some short covering or fresh buying in some select counters in the coming week, as they have slumped on Friday as the group ministers have approved the draft of the mining bill, which proposes that coal miners share 26% of their profits with displaced locals, and miners, other than coal companies, share 100% royalty.

Markets rallied from the low of 5200 to 5700 levels within a very short time. RSI at 5200 levels was at its over sold zone, which currently touched its over bought zone within 14 days of its trading session. Nifty setback it’s ever rising streak and relaxed after facing resistance at its 200DMA.

Nifty will continue to resistance at 5700-5750 levels. Nifty has good support levels at 5600, but the close below the same can take the nifty further down. Since the markets have rallied a bit too fast, we may see some side ways movement.

Monday, Jul 11 - Morning brief for the stock market

Stocks To Watch: HCL Tech, Ranbaxy, Bharti airtel, Idea Cellular

Monday, Jul 11 - Morning brief for the stock market:

BIG PICTURE

* Income inequality between rural and urban consumers widened to 91% in the first five years of the United Progressive Alliance coming to power in 2004. (Mint, Sat)

* The Cabinet reshuffle, due today, has been postponed ostensibly as a train accident involving Kalka Mail has claimed over 35 lives. (var)

TOP EVENTS TODAY
* Apr-Jun earnings to be detailed by: Chemfab Alkalis, CMC, Essar Oil, Kavveri Telecom Products, Shanthi Gears, Sintex Industries.
* Annual General Meet of: ASM Technologies, Electrosteel Castings, Indo Asian Fusegear, MSL Industries, Muthoot Capital Services, and Shanthi Gears.

* Board Meetings of:

+ Bilcare to consider dividend.

+ Esaar India to consider 10-for-1 stock spilt.

+ Gujarat Pipavav Port to mull seeking new terms for 7.65-bln-rupee loan.

+ V & K Softech to consider pref issue of shares, warrants, other securities.

INDICATORS (previous session)

* NSE provisional net buy/(sale) in bln rupees, Jul 8: FII 5.17, DII (3.89)

* Institutional net buy/(sale) in bln rupees, Jul 7: FIIs 7.5, MF 1.72

* FII NSE futures net buy/(sale) in bln rupee, Jul 8: index (5.62), shr (6.99)

* Sensex 18858.04, down 220.26 points; Nifty 5660.65, down 68.30 points

* Crude: $96.20/bbl; Rupee: 44.32/$1; Gold: $x,xxx.xx/ounce; 10-yr yld: 8.3531%

WEEKLY SECTOR OUTLOOK

* AUTO: Subdued on weak sales outlook for 2011-12 (Apr-Mar).

* BANKS: To track the movement in the broad market.

* CAPITAL GOODS: May slip on profit booking after three-four weeks of gains.

* CEMENT: In band with negative bias due to weak demand and likely price cut.

* FMCG: Seen firm due to defensive buying.

* INFORMATION TECHNOLOGY: To eye INFOSYS, TATA CONSULTANCY SERVICES' earnings.

* OIL: Seen weak; RELIANCE INDUSTRIES in focus as Cabinet may take up BP deal.

* PHARMACEUTICAL: Likely to gain on defensive buying.

* STEEL: In band with weak bias due to draft mining bill, low demand for steel.

* TELECOMMUNICATIONS: Seen down due to profit booking.

OUTLOOK

* Domestic share indices are likely to open weak due to negative global cues following disappointing US jobs data and further profit booking as the market is in an "overbought zone".

GLOBAL STOCK MARKETS

* US: Stocks on Wall Street ended down Friday as rise in non-farm payrolls in June was way below expectation, and as unemployment rate in the US rose to 9.2% in June, the highest since December, from 9.1% in May.

* ASIA: Key Asian markets were trading down today as dismal US jobs data for June reported over the weekend hurt investor optimism about economic recovery.

SECTOR NEWS

* AGRICULTURE: Planning Commission, in the 12th Five-Year Plan, wants to create a pricing mechanism for water that makes farmers pay for the operation and maintenance of water delivery systems. (BS, Sat)

* AUTOMOBILE: Fiat has hired 53-year old Enrico Atanasio to turn around its Indian operations to beat rivals such as Volkswagen. (var)

Volkswagen India's plan to expand capacity at the Chakan plant in Maharashtra has hit a hurdle due to the recent change in the state's tax laws. (ET, Sat)

* AVIATION: Air India employees may have to take a wage cut as part of the carrier's turnaround plans. (ET, Sat)

Supreme Court has rejected Sahara group's plea for a notice to the government on a SEBI order to return with 15% interest the funds raised from investors under an optionally fully convertible debenture scheme. (BS, Sat)

Low-cost carriers can no longer refuse food to passengers if a flight is delayed by three hours or more. (ToI, Sat)

Tata group's Tata Industrial Services to focus on contractual project management in aerospace and defence sector. (FE)

* BANKING: Deutsche Bank investment banking head Anshu Jain may become co-chief executive officer along with a German speaking board member. (var)

Government asks public sector banks to hike lending to micro enterprises as many banks did not meet account-opening targets for the segment in 2010-11. (Mint, Sat)

Banks to hike tenure of education loans to 15 years from seven. (ToI, Sat)

C Rangarajan, chairman of the Prime Minister's economic advisory council, suggests giving bank licences first to non-corporates before allowing corporates to enter the field (ET)

* CORPORATE: Corporate affairs ministry blacklists 155,392 companies for violating norms. The firms will not be allowed to borrow from banks and financial institutions. (Mint, Sat)

Government plans to relax exit-norms for not-for-profit companies to allow them to de-register without having to follow cumbersome regulations. (BS)

After taking a decision on the outright sale of ailing SCOOTERS INDIA, government has proposed to follow a similar divestment process for HMT Bearings and Tyre Corp of India. (PTI)

* DEFENCE: US eyes investment of nearly $30 bln in India's defence sector over the next few years. (BS, Sat)

In the next few weeks, the Government may ease rules for large overseas defence contractors on sourcing components from domestic vendors. (Mint)

* EDUCATION: Department of Industrial Policy and Promotion recommends scrapping of three-year lock-in on foreign direct investment in the sector. (ET)

* ENERGY: Essar Energy has tied up a three-year secured revolving $1.5 bln working capital loan with six banks, and a $400-mln term credit with two other banks to fund the acquisition of Stanlow refinery from Royal Dutch Shell. (Mint, Sat)

* FERTILISER: Government allows fertiliser firms to set retail prices of phosphatic and potassic nutrients but asks them to keep rates at a "reasonable level". (ET, Sat)

Empowered Group of Ministers is expected to meet in next two weeks to finally approve the Nutrient Based Subsidy hpolicy for urea. (BS)

* FOREIGN EXCHANGE: Enforcement Directorate has slapped a 71-bln-rupee notice on Etisalat DB for violating the Foreign Exchange Management Act and given the company 15 days to respond. (var)

* GOVERNMENT: To seek review of Supreme Court's decision to set up a special investigation team to probe black money. (var)

* HOSPITALITY: Chennai-based Appu Hotels, which runs the Le Royal Meridian hotels in Tamil Nadu, plans to invest 2 bln rupees in two hotels in Sri Lanka and expects to sell shares by the second half of 2012 to raise 5-10 bln rupees for funding expansion. (Mint)

Several Indian budget and mid-segment hotels are scouting for private equity money to fuel growth and expansion. (Mint)

* INFORMATION TECHNOLOGY: US customers ask Indian information technology companies to cut rates by up to 15% (ET)

* MEDIA: Sun18 and MSM Discovery are in talks to jointly distribute channels. (Mint)

* MINING: Planning Commission Deputy Chairman Montek Singh Ahluwalia has said asking mining companies to share profits with the project-affected was not a good idea. (BS)

Posco has roped in two local firms for its proposed 323.66-bln-rupee, 6-mln-tn facility in Karnataka to ensure speedy clearances and uninterrupted iron ore supply. (var)

Australia has slapped a carbon tax of A$23 per tn of coal mined in the nation. (FC)

A group of ministers on the new Mines and Minerals (Development & Regulation) Bill, 2011, has also approved levy of 2.5% central cess and 10% state cess on amount of royalty paid by companies. (DNA)

* MONSOON: Rainfall in July so far has been about 27% below normal compared with 11% above normal in June.

* MUTUAL FUNDS: Mutual fund industry has approached the Securities and Exchange Board of India to allow entry into the pension product market in a bid to garner long-term funds. (var)

Employees Provident Fund Organisation's apex decision maker Central Board of Trustees will meet on Thursday to appoint new fund managers for managing its corpus of 3.5 trln rupees. (var)

* OIL: The Empowered Group of Ministers on fuel might meet Tuesday to mull direct transfer of kerosene subsidy to states, said a source. The EGoM might approve annual cap on the number of subsidised LPG cylinders per family.

* POWER: Steel, textiles, and cement mills are buying electricity directly

from power exchanges, particularly in Punjab and Tamil Nadu, to cut costs.

(ET, Sat)

French company Areva's Indian partners in the 9,900 MW nuclear power park in Jaitapur will contribute material and services worth 40-45% of the cost of the first two reactors. (Mint, Sat)

Central Electricity Regulatory Commission will review tariff determination norms for biomass power projects so developers can pass on the cost to consumers. (FE, Sat)

Cabinet will decide this month on subsidising interest on loans taken by state electricity boards to cut distribution losses. (Mint)

* RAILWAYS: Indian Railways to buy more wagons from the lowest bidder in 2011-12 to reduce cost of buying rolling stock. (FE, Sat)

* REAL ESTATE: Nomura Financial Advisory and Securities said Mumbai property sale registrations fell 30% on year to 4,272 in June, indicating the housing market in the city is slowing down.

Government is likely to introduce the Real Estate (Regulation and Development) Bill, 2011, in the monsoon session of the Parliament to promote planned development of real estate and protection of public interest. (PTI)

* RETAIL: The move to open multi-brand retail to foreign direct investment may run rough weather, with key Bharatiya Janata Party-ruled states and some constituent parties of the United Progressive Alliance rejecting or being ambivalent towardsthe proposed policy. (BS)

Mukesh Ambani, who brought in a new team of expats to head his retail business, in the second management shake up in almost a year, has given the new team three years to turn around the business. (FC)

* STEEL: Government bans import of low-grade electrical steel sheet, a critical component in power transformers. (ET, Sat)

* STOCK EXCHANGES: SEBI says it has executive powers to recognise and authorise stock exchanges, and MCX-SX cannot seek authorisation from the Bombay High Court. (var)

A new exchange for small and medium enterprises, a Bombay Stock Exchange initiative, will go live in September. (BS)

* TAXATION: The Mumbai income tax department's tax-deducted-at-source collection rose 27% on year to 150 bln rupees in Apr-Jun. (ET, Sat)

Third-party information related to high-value transactions in immovable properties will be one of the focus areas of the Income Tax Department for tracking tax evasion. (BS)

* TEA: Indian tea companies' plan to acquire tea estates in South Africa hit as the country scraps privatisation process and plans a new regulator. (ET)

* TELECOMMUNICATIONS: Lok Sabha Speaker Meira Kumar has indicated the document of the Public Accounters Committee on 2G spectrum allocation cannot be called a report. (ET, Sat)

Corporate Affairs Minister Murli Deora defends giving a clean chit to the Essar Group, saying the company's holding in Loop Telecom had been within permissible limits. (var)

After Swan Telecom and UNITECH, the Income Tax Department is looking into the tax implications of a deal between Datacom Soulutions and the Videocon group after the former was allotted 2G licences in 21 circles for 15.07 bln rupees in 2008. (var)

Supreme Court will today hear a public interest litigation based on a Comptroller and Auditor General of India report that players like BHARTI AIRTEL, Vodafone, and IDEA CELLULAR were major beneficiaries of the migration from a fixed-licence regime to that of revenue-sharing. (BS)

Telecom tower companies struggle with surplus capacity as new tenants fail to sign up and consolidation triggers wane. (FE)

STOCKS
* ANDHRA BANK: To hike Base Rate 25 basis points to 10.25% and Benchmark Prime Lending rate 25 bps to 14.50% from today.

* ASHOK LEYLAND: In pact with Krishnapatnam Port Co to supply 85 U-trucks.

* AURIONPRO SOLUTIONS: Has received Bombay High Court nod to merge E2E Infotech (India) and Kairoleaf Analytic with self

* BAJAJ AUTO: Is gearing up to cash in on the new trend with products suited to meet the requirements of the hinterlands. (PTI)

* BANAS FINANCE: To mull a 10-for-1 stock split on Friday.

* BHARAT HEAVY ELECTRICALS: Government invites bids from merchant bankers to advise on BHEL follow-on public offer.

* BHARTI AIRTEL: Arm Bharti Infratel plans initial public offer of at least $500 mln and may file regulatory papers in September or October. (DNA, Sat)

* BHUSHAN STEEL: To raise up to 45 bln rupees this year to fund capacity expansion plans and retire debt. (DNA, Sat)

* CINEMAX INDIA: Launches a four-screen multiplex in Pune.

* COAL INDIA: OIL AND NATURAL GAS CORP has taken over COAL INDIA in terms of market capitalisation. (var)

Mines secretary allays concerns that new norm on profit sharing with locals could hit company finances. (FE)

* COMPACT DISC INDIA: Sees 2011-12 net profit at 540 mln rupees and sales revenue at 3 bln rupees. Promoters say are committed to delisting the stock from exchanges.

* CORE PROJECTS & TECHNOLOGIES: Is in talks with SUPREME INDUSTRIES to buy out the latter's office property in Andheri, Mumbai, in a deal that could be worth 3.5 bln rupees. (BS)

* DECCAN CHRONICLE HOLDINGS: Has bought back 13.69 mln shares via open market operations for 900.3 mln rupees. (BS)

* ELDER PHARMACEUTICALS: Will not market Tiger Balm in India as the company has cut marketing ties with the brand's Singaporean owner Haw Par Healthcare. (var)

* GLOBAL OFFSHORE: To issue to promoters up to 440,000 shares on a preferential basis at 121 rupees a share and up to 469,700 warrants.

* GRANULES INDIA: Approves joint venture with SA Ajinomoto Omnichem.

* GUJARAT STATE PETRONET: Gets authorisation letter for three pipelines.

* HT MEDIA: Delhi High Court allows company to cancel planned restructuring.

* HCL TECHNOLOGIES: Has won a contract to provide application management services to home furnishings retailer IKEA.

* HOUSING DEVELOPMENT FINANCE CORP: Chairman Deepak Parekh says HDFC Life Insurance's initial public offer likely in two years. Parekh sees 2011-12 credit growth at around 20%.

* IDEA CELLULAR: US-based private equity firm Providence Equity Partners, which holds 9.99% stake in the company, is considering exiting from it. (BS)

* INDO ASIAN FUSEGEAR: Eon Electric, formerly known as INDO ASIAN FUSEGEAR, will buy back up to 6.45% equity via open market operations at not beyond 130 rupees per share. (FE)

* ITC: Has filed a suit against its one-time trading partner, the Chitalias, to recover assets that it says the two brothers have in India. (BS)

* JINDAL STEEL AND POWER: Plans $250 mln railway link between its Bolivian mine and proposed port. (ET)

* KARUTURI GLOBAL: To mull on Tuesday the opening date for issuing global depositary receipts.

* MAHANAGAR TELEPHONE NIGAM: Communications minister Sibal asks company to achieve 25% jump in revenue by Mar. (ET)

* MAHINDRA & MAHINDRA: The group's umbrella entity Mahindra Systech has been short-listed to buy Canada's Wescast Industries. (BS, Sat)

* MOREPEN LABORATORIES: Has got US Food and Drug Administration's nod to manufacture anti-allergy drug Desloratadine, the generic version of Clarinex, at its plant in Parwanoo, Himachal Pradesh.

* NALCO: To hive off non-aluminium businesses such as power and mining of other minerals into separate entities after they reach a critical size. (ET, Sat)
To infuse 17 bln rupees for a 49% stake in Kakrapar nuclear power plant in Gujarat. (var)

* NET 4 INDIA: To mull business restructuring on Friday.

* NITCO: Bombay High Court approves amalgamation of Particle Boards India with the company.

* ORISSA MINERAL DEVELOPMENT CO: Is in talks with Kudremukh Iron Ore Co, NMDC, and Manganese Ore India for contract mining of its iron ore reserves. (DNA, Sat)

* POWER GRID CORP OF INDIA: Plans to raise 50-70 bln rupees via a follow-on public offer, the process for which will start in 2013-14. (BS, Sat)

* PTC INDIA: May float two private equity funds as efforts to strengthen financial capabilities. (PTI)

* RANBAXY LABORATORIES: Is close to settling its pending issues with the US FDA for $300 mln-$400 mln. (ToI, Sat)

* RELIANCE COMMUNICATIONS: Telecom Minister Kapil Sibal denies favouring the company, saying the imposed penalty of over 50 mln rupees was in line with the company's agreement with Universal Service Obligation Fund. (var)

* RELIANCE INFRASTRUCTURE: Denies reports of plans to sell stake in its power transmission business, road and subway projects. (ET, Sat)

* RELIANCE POWER: Arm Coastal Andhra Power has stopped work on its Krishnapatnam Ultra Mega Power Project due to a hike in the cost of coal from Indonesia that the project is to run on. (BL, Sat)

* RELIANCE INDUSTRIES: Has said it is not being given enough time to respond to the audit observations on Krishna-Godavari D6 gas fields by the Comptroller and Auditor General of India. (var)

* SPANCO: Board approves increasing borrowing limit up to 35 bln rupees.

* STATE TRADING CORP OF INDIA: Has formed a consortium with seven other companies called SEALAC Agro Ventures to cultivate soybean and pulses in Uruguay and Paraguay (FC).

* TATA MOTORS: Plans to set up an assembly plant in South Africa. (DNA, Sat)
To use its commercial vehicle network to stock and sell select passenger vehicles, particularly in smaller towns and cities not covered by passenger vehicle dealerships. (ToI, Sat)

Supreme Court rejects company's plea against levy of non-agricultural cess on its Pune plant by local authorities. (ET)

* TILAK FINANCE: To mull a 10-for-1 stock split on Friday.

* UNION BANK OF INDIA: Pays 2.39 bln rupees dividend to the government for 2010-11.

* WPIL: Singaporean arm buys 100% stake in Mathers Foundry.

* YES BANK: Targets 40-50 bln rupees in education sector loans by 2015.