Technical Bazaar’s Newsletter for April 1st, 2010
March 31, 2010 by admin
Filed under Analyst's Corner
Stock Market Outlook for April 1, 2010
The key benchmark indices edged lower on the last day of the financial year 2010, extending losses for the second straight day as Asian stocks and US index futures fell. Nevertheless, the market logged huge gains in the year ended March 2010 (FY 2010). The BSE 30-share Sensex fell 62.40 points or 0.35%, off close to 170 points from the day’s high and up close to 40 points from the day’s low. The Sensex rose 62.96 points or 0.36% in the quarter ended March 2010, gaining for the fifth quarter in a row.
The barometer index vaulted 7,819.27 points or 80.5% in FY 2010. In today’s trade, FMCG and IT stocks fell. Index heavyweight Reliance Industries (RIL), too, edged lower. But the market breadth, indicating the overall health of the market was positive. The market was volatile on the last day of the fourth quarter and the financial year. Stocks surged in early trade, shrugging off weak Asian stocks. The market pared gains in morning trade. Stocks slipped into the red in mid-morning trade. The market came off the day’s low in early afternoon trade.
The market regained positive zone in afternoon trade as European stocks edged higher. The market once again slipped into the red in mid-afternoon trade. The market cut losses after hitting a fresh intraday low. NSE\’s volatility index, India VIX, rose 0.35% to 19.87. The index had risen sharply in the preceding three trading sessions. India VIX is a measure of the market\’s expectation of volatility over the next 30 calendar days. The lower the index, which is based the S&P CNX Nifty option prices, the higher the market’s desire to take risk.
Industrial output in February is expected to have grown 16% year-on-year, Industry Secretary said on Wednesday. The output in January grew an annual 16.7%. Foreign direct investment rose 15.4% to $1.72 billion in February 2010 over February 2009, government said today. Exports in February grew 34.8% on year to $16.09 billion, Trade Minister Anand Sharma said on Wednesday.
Exports are expected to grow 15-20% in the year that starts on 1 April 2010, Sharma said Foreign institutional investors have made heavy purchases of Indian stocks in the past few weeks helping stocks register strong gains this month. The Sensex had jumped 1,457.15 points or 8.96% to a 2-year closing high of 17711.35 on Monday, 29 March 2010, from a low of 16,254.20 on 25 February 2010. As per data from the stock exchanges, foreign institutional investors (FIIs) bought stocks worth a net Rs 14,358.81 crore this month, till 30 March 2010. Finance secretary Ashok Chawla said on Tuesday, 23 March 2010, that foreign capital flows into India are currently not posing any concern. Meanwhile, stock brokers have advised investors not to sell shares bought today, 31 March 2010, the next day i.e. on Thursday, 1 April 2010, due to clubbing of settlement by the stock exchanges. There will be no settlement of shares/funds on 1 April 2010 due to annual closing of books of accounts of commercial banks. The current financial year ends today, 31 March 2010.
Nifty Summary: Nifty look weaks below and one can cover @5234 levels and initate longs above 5279 for a target of 5315 , Bank Nifty looks weak and Metals look a bit strong.
Opening Bell:
Stocks to short at Gap up opening: Short Reliance inds. @ 1080 with a stop loss of 1094and cover at 1066 cmp 1074.
Stocks to buy at gap down opening: Buy Jain irrigation @ 953 with a stop loss of 937 And target of 974 cmp 958.
Continuation Trend for long: Buy GAIL @ 407 for target @ 413 and stop loss 404.
Continuation Trend for Short: Short Biocon @ 285 and cover @ 278 and stop loss of 289.
Expected Top out: Book profits at higher levels in Cipla @ 337 or cmp 337.
Expected Bottom out: Go long at lower levels in TV 18 @ 75.40. Or cmp 75.50.
Momentum Positional call: Sell FT @ 1576 for a period of 5 days with a stop loss of 1604 and a target of 1541.
Midcap Mania: Buy Indo count @ 2.32.
Options:
Positional call option: Buy Call option of NTPC of April strike price of 210 @ 3.05 with a stop loss of 1.50 and a target of 4.55 cmp 207.90.
Positional put option: Buy Put option of Balrampur Chini of April strike price of 90 @ 2.90 with a stop loss of 1 and a target of 4.80.cmp 92.
Futures Hedging: Sell Tata steel @ 631 & Sell put option of sp 600 @ 10.05.
Options Hedging: Buy Call option of Unitech of sp 70 @ 5.35 & sell call option of sp 80 @ 1.05.
Grow Investment
Short term delivery: Buy Rana sugars @ 13.01 for 8 to 10 days for 5-7% returns.
Medium Term delivery: Buy D.S.kulkarni @ 61 for 12 to 20 days for 8-12% returns.
Long Term delivery: Buy Amtek auto @ 194 for 20-50 days for 12-25% returns.
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