cmp: 951.50-52
target price::975
stoploss ::940
go for it.........

NEW DELHI: The S&P BSE Sensex pared most of the morning gains and turned choppy in the afternoon trade on Friday, led by losses in HUL, ICICI Bank BSE -2.44 % and M&M Ltd.

At 11:30 am, the 50-share Nifty index was at 5,717.45, down 10 point or 0.2 per cent. It touched a high of 5,761.85 and a low of 5,705.05 in early trade today.

The S&P BSE Sensex was at 19,309.13, down 7.7 points or 0.04 per cent. It touched a high of 19,451.70 and a low of 19,273.08 in trade today.

 Ashwani Gujral of ashwanigujral.com

TCS Ltd is a 'BUY' call with a target of Rs 1870 and a stop loss of Rs 1820.

Titan Industries BSE 8.05 % Ltd is a 'BUY' call with a target of Rs 285 and a stop loss of Rs 270.

BPCL BSE -6.28 % is a 'SELL' call with a target of Rs 287 and a stop loss of Rs 305.

Power Grid Ltd is a 'SELL' call with a target of Rs 82 and a stop loss of Rs 95.

Mitesh Thacker of miteshthacker.com

Voltas Ltd BSE -4.08 % is a 'SELL' call with a target of Rs 67 and a stop loss of Rs 76.

Jubilant FoodWorks Ltd is a 'SELL' call with a target of Rs 1040 and a stop loss of Rs 1111.

Infosys Ltd is a 'BUY' call with a target of Rs 3085 and a stop loss of Rs 2977.

Lupin Ltd is a 'BUY' call with a target of Rs 915 and a stop loss of Rs 874.

Sandeep Wagle, Founder & MD, APTART Technical Advisory Services

M&M Ltd is a 'SELL' call with a target of Rs 830 and a stop loss of Rs 870.

Jindal Steel Ltd is a 'SELL' call with a target of Rs 179 and a stop loss of Rs 191.

Titan Industries Ltd is a 'BUY' call with a target of Rs 292 and a stop loss of Rs 273.

Prakash Gaba, CFT, prakashgaba.com

BHEL BSE 1.46 % is a 'BUY' call with a target of Rs 157 and a stop loss of Rs 149.

Tata Communications BSE -1.43 % Ltd is a 'BUY' call with a target of Rs 162 and a stop loss of Rs 142.

M&M Ltd is a 'SELL' call with a target of Rs 835 and a stop loss of Rs 870.

Ashish Chaturmohta, Head Technical & Derivatives Desk Research, Fortune Equity Brokers

Infosys Ltd is a 'BUY' call with a target of Rs 3100 and a stop loss of Rs 2995.

Aurobindo Pharma Ltd is a 'SELL' call with a target of Rs 145 and a stop loss of Rs 165.

Hindustan Zinc Ltd is a 'SELL' call with a target of Rs 90 and a stop loss of Rs 100.

Mitesh Panchal, AVP (Value Addition), Shah Investor's Home Limited

Infosys Ltd is a 'BUY' call with a target of Rs 930 and a stop loss of Rs 820.

Ambuja Cements Ltd is a 'BUY' call with a target of Rs 200 and a stop loss of Rs 160.

JP Associates Ltd is a 'BUY' call with a target of Rs 38 and a stop loss of Rs 30.50.

ET Now: The big picture is that macro is looking slightly challenging, money is moving out of the markets and crude prices are refusing to come down.

Prasun Gajri: Yes, the macro is clearly challenging and that is what is reflected in the way the rupee has been behaving. So that is a clear indication that any capital inflow or outflow, which happens very quickly, can lead to a large change in the way our macro is positioned. So that has been a problem for a while, it is just getting accentuated.

ET Now: Is it a time now to hunker down all the recovery expectations?

Prasun Gajri: If you are looking at current account that is a challenging problem,, which is not going to go in a hurry. Clearly, one can argue whether it is $80 billion or $90 billion, but we have to fund somewhere to the tune of $80 to $90 billion every year at least for this year and that will require reasonably benign global flows. Therefore, that problem remains.

On the fiscal side, while the intentions from the government do seem to indicate that they want to control the fiscal at 4.8% of GDP, it is going to be a very tough challenge given the slowdown in the economy, the tax numbers for the first two months, little progress on the disinvestment, and food security bill.

Inflation definitely seems to be under control. So that is one big positive which has emerged. Interest rates have not really moved up too much despite the rupee cracking. So that correlation between the rupee falling and interest rates also rising seems to have broken down a little bit over the last few days. Tat is something which is again a positive sign.

ET Now: The argument for Indian equities at least for next one year is not very constructive and given the kind of macros we are working with looks like that we could be in a range for another one year?

Prasun Gajri: We could be in a range for another one year. I do not think there is too much debate about that. For the markets to really move out of the range, something has to happen either positive or extremely negative. So I would agree that the range is there, but having said that what sectors do well and what do not may not necessarily follow what has been happening in the past and that is going to be something which could be different.

We saw some outflows in June, but that was hardly anything compared to the inflows which we have seen this year and in the earlier year as well. So if they sell what they own then clearly some of the stocks which are at very high valuations will not do so well and some of the stocks which are at completely beaten down valuations may sustain. So clearly what outperforms, what underperforms is something which remains to be seen.

The market today is in a complete risk off mode where we continue to give higher multiples to sectors where the fundamentals are clearly deteriorating, but the valuations are higher than what they were 12 months back and there are some other sectors where the fundamentals are clearly weak, but the valuations are just getting beaten up every single day. So clearly that dichotomy may change over the next 12 months, especially if you see FII outflows and ETF outflows from the Indian market that is something which may undergo a change. So the nature of what performs in the market or does not perform in the market could be interesting.

ET Now: Do you expect that Q1 numbers will be rather noisy given the way how the rupee has moved for the quarter gone by, what has happened to bond yields and commodity prices?

Prasun Gajri: See there could have been noise, but the fact is that the rupee movement does not tend to appear in the P&L given the way the accounting is done. It tends to go into the balance sheet, so it does not necessarily make it all that noisy. Having said that, I do not think there are any great expectations from this quarter. Most people anticipate virtually zero to very-very low growth for this quarter. So we are not really building in any major positive surprises. The interest rates have moved, that is something which has been the case for a while. So I do not think that really clouds the things, but overall no major expectations from this quarter.

ET Now: So what could be the next big trigger because you are sounding more bearish than bullish to me?

Prasun Gajri: If I have to talk about the economy it is a more balanced view where we will see probably better growth, but structurally the economy needs to get back to 7-7.5% growth. We will be stuck around 5.5-6% for a while if we do not change that. On the market, clearly the market is bipolar while the valuations may look reasonable from averages perspective, there is a part of the market which is completely trading at the lows post the global financial crisis and there is another part of the market which is trading at all-time highs in terms of valuations.

We are seeing a relative slowdown. Obviously these categories are still doing well, there is a relative slowdown, but do the valuations really justify that? That is something which will remain to be seen and second aspect is if there is actually a sell off in the Indian equity markets from the global investors, I guess the stocks which will be more vulnerable are the high valued stock. So I do not have major expectations from this market. I don't think that it can give me a very high double digit return this year, but you could actually make reasonable returns if you get your sectors right.

ET Now: If you are of the view that one should still be buying into high beta and one should not get obsessed with quality, what are the options which are left?

Prasun Gajri: No, I am not suggesting either of the two strategies. One has to follow a balanced approach. I do not think it is a market which has helped being in high beta very clearly, but having said that it is not a market which is always going to help being in quality. So that is a distinction one will have to start making at some point of time and have that balanced approach to the portfolio.

If you look around, I cannot get into specific names, but there are enough stocks which are trading at post-2008 lows with may be weak fundamentals, but they are not as bad as being made out. So it is a stock-specific market, it is easy decision to be safe today. It is a safe decision from a fund manager's perspective. It is an easier decision, it is very little chance of you going wrong effectively, nobody is really going to question you, but having said that is where I do believe there could be some sense of complacency which could be set in and that gives an opportunity to really look at that from a very different perspective.

ET Now: What do you make of the global mood? One is getting a sense that we are staring at a divided world and emerging market equities are underperforming developed market equities.

Prasun Gajri: The story which has been for a while is a stronger US growth and weaker Europe and probably a little bit better Japan and a weaker China. Now that is something which seems to be driving the global economy at the moment, and at the margin that is something which is going to drive the global asset prices as well. Now the question remains how strong is really the US economy? The indicators we have seen so far do point out that it is coming out from the lows, but how strong does it really get? We are still talking about 2 to 2.5% kind of growth!
The fiscal situation in the US is still nothing great and it remains to be seen if once the QE starts tapering off whether the economy really stays as strong as it is being made out to be or are there repercussions of higher interest rates in the US and the economic growth in the US because we have clearly seen the bond yields and the mortgage rates rise fairly substantial in the US.

The emerging market will still give you between 5 and 7% kind of growth, the fiscal situation in emerging markets is still better than most of the developed world and the opportunities in the emerging markets could still possibly be better than a lot of the developed markets. So while on a cyclical basis, short term basis what you are saying is right, but structurally I do not think the emerging market theme is broken. Yes, there is a slowdown in emerging markets, but clearly if the US actually picks up, the emerging markets also should do well and once that happens you could see the fund flows back to the emerging markets and emerging markets again starting doing well. So it is a fairly linked process. It is difficult to write off the emerging markets so quickly and so soon.

ET Now: Let us look at the local fund flow situation whereas LIC has become a net buyer. What are local insurance firms doing, are you also putting money to work or redemption is still a problem?

Prasun Gajri: The local insurance companies are not necessarily getting the flows at the same pace as they were getting. I do not think their net redemptions are at a very serious level, but I do not think the inflows are very exciting either. LIC seems to have been a big buyer, but clearly LIC was a big seller in the Jan to March quarter when most of us and other private insurance companies were clearly buying. So they had a large amount of accumulated cash which has been put to work now, but overall I do not see too much of fund flows into the equity markets for the domestic institutional investors at that moment.

ET Now: When do you think will be the turning point where retail investors will start pulling money out of fixed income products and they could revisit equities?

Prasun Gajri: Equity market has to do well for a while and sustain itself and get some positive buzz around it for the retail investor to come. See a larger amount of retail investors whosoever have entered in 2007-2008 is a complete dissolution and nothing really to blame the investor because the markets have been like that and therefore it is going to take a little bit of time, markets have to sustain, real interest rates have to become positive. Only then one will see the retail investors being keen on the equity markets. So it could be a little bit longer than one anticipates.

ET Now: Let us look at currency sensitives now. The consensus call is that it is time to buy into pharma, IT, it is time to buy companies which will benefit because of weak rupee. Do you see there is merit in this trade?
Prasun Gajri: Currency is a big beneficiary for sectors like pharma and IT. For pharma it is a bigger positive. For IT it remains to be seen while it is a positive, it clearly allows them a lot of levy, but if you really look at it, the margins of IT companies have actually shrunk over the last 12 to 18 months despite a very significant rupee depreciation.

That tells me that while it is good for their business, a lot of those benefits tend to be spent away either in terms of pricing, or further expansion, or further spending, or further investments in the business and it is not getting reflected in the margins. So while in the short term it is positive, I would be a little bit wary of really putting that into numbers over the longer term. IT companies also depend on how the global macro plays out and how the growth in US really pans out and therefore what is the demand situation for them that is to my mind a much bigger factor and will influence some of these names much more.

ET Now: What is the best way to approach consumers? Again the Street is divided on what exactly it should do when it comes to consumer names?

Prasun Gajri: It is very easy to say get out of consumers but I do not think people would be very happy to get out of consumers because that is a trade which has played over the last two-two and a half years without any problem and it is a fairly easy trade. None of these companies are going to lose you any significant amount of money to be honest. You may get a 5%-10% correction, but there could be a long time correction in these names. So that would be a worry.

If I were to really look at it, two or three things stand out. One is I would be more bullish on the rural sector side of the consumption than urban consumption. So clearly put more money to work on ideas which are more reliant on rural consumption than urban consumption. That is one aspect. Look where the earning growth is still reasonable. So, if the earning growth is still reasonable, if the earning growth is going to be 8% to 10% or 10% to 12% and the valuations are 35-40 times, this clearly does not make sense but if the earning growth is still going to be between 15 and 20%, you might as well play the valuations and stick onto it. So one has to differentiate between the FMCG names, which has not really happened so far.

NEW DELHI: Investors globally pulled out more than $3 billion from equity funds focused on emerging markets including India in a week amid concerns over the US Federal Reserve's plan of curtailing its stimulus drive starting later this year, says a report.

According to funds tracking company EPFR Global, over $3 billion has flown out of emerging markets equity funds during the week ending June 19.

Explaining the outflow, the report said "investors expected the outcome of the US Federal Reserve's latest meeting to be relatively benign".

However, equity funds attracted net inflows to the tune of $4.81 billion during the third week of June.

"While investors are distancing themselves from most of the top tier emerging markets such as China, Brazil, Russia and South Africa, they have retained their appetite for the smaller, riskier, faster growing ones," the report noted.

The US Federal Reserve's decision to curtail its liquidity measures with a goal of ending it in mid-2014 has been weighing on emerging market funds.

The EPFR did not disclose India-specific fund outflow data. But, according to information available with the Securities and Exchange Board of India ( Sebi), the foreign institutional investors (FIIs) pulled out $580 million from the Indian market during the week under review.

Most of emerging market focused equity funds invest in India as FIIs and the capital flows through this route are a key factor in the stock market trends here.

At the country level, Japan equity posted inflows for the straight 21 week, while Germany and Korea also attracted fresh money.

However, equity funds dedicated to China extended their losing run as a report from ratings agency Fitch raised new questions about the country's shadow banking system

MUMBAI: Ahead of the mid-quarter review of monetary policy tomorrow, the State Bank of IndiaBSE 1.31 % (SBI) has said if the apex bank cannot reduce CRR rate, which is a must for lending rate cuts by banks, they should pay interest on cash reserves that banks park with the monetary authority.

Incidentally, most analysts expect the RBI to hold rates during its mid-quarter monetary policy review.

"If a CRR cut cannot be done due to inflation worries, let the RBI pay us interest on CRR. We will then do the transmission for sure. If the RBI pays me Rs 500 crore on interest on my CRR, I promise to transmit the entire Rs 500 crore to borrowers by reducing my base rate," SBIBSE 1.31 % chairman Pratip Chaudhuri told PTI recently.

Last year he had triggered off a heated debate by calling for abolition of CRR. He felt that CRR is "dead money" and it had led to a public spat with K C Chakrabarty, the RBI deputy governor in charge of banking services, who said that if the SBI chairman is not comfortable working under existing regulations, he should look for "some other sector".

Explaining the rationale for SBI's as well as other banks' inability to cut lending rates with minor repo rate cuts that RBI has done by 125 basis points (1.25 per cent) since the middle of the past fiscal, Chaudhuri said, "The relationship between the repurchase rate and the bank lending rate is rather weak. Bank deposits rates are guided by postal deposit rates and not by RBI rates".

Further, he said that a 25 basis points reurchase rate cut will give an additional income of merely Rs 50 crore to the SBI.

"How do I distribute it to my borrowers when my loan book is Rs 7 trillion? Instead, if the RBI reduces CRR by 25 basis points, I get about Rs 3,000 crore. So, if there is a CRR cut, then the transmission is more pronounced," the SBI chairman argued.

Valuations of private sector banks are now slightly getting stretched even though there isn’t a doubt that these institutions have better-managed balance sheets than their public sector counterparts, says Sandeep Bhatia, executive director & head of sales, Kotak Institutional Equities, in an interview to CNBC-TV18. He advised investors to have no exposure to PSU banks.

Speaking on market, Bhatia said the current flow of liquidity from the US will tend to slowdown in the next two years although it will be in abundance in Europe and Japan and India can enjoy some of the benevolence coming from Japan.

Maintaining that both market and outperforming stocks are capped by valuations, Bhatia said there are not many investors on the street who would place their bets on cheaper stocks. He is doubtful of an improvement in India’s macro situation but remains bullish on the pharma sector .

Below is the verbatim transcript of his interview on CNBC-TV18

Q: What is the mood on banking right now because this quarter has been so disparate in terms of earnings good earnings from private sector but not so good from public sector banks?

A: Yes that is true. The balance sheets of the public sector are showing signs of strain. Our belief is that if the economy does not improve in the next 18 months there would be further strain on the balance sheets of the public sector banks.

The private sector banks have carved themselves a very good niche. They are focused on the retail side of the asset much more. Their balance sheet management and working processes are much more stringent. So, clearly we see less stress on the balance sheets there but valuations are getting stretched on the private sector banks. This differentiation between private sector and public sector will run for some more time but it will be clearly stretched valuation for private sector banks which have to be watched for.

Q: How are you mapping the whole infra space now, which is connected to the banking world very closely. Are you seeing any signs of recovery because company earnings have been quite weak almost without exception over the last four-five days?

A: For a long time we have been saying that we do not see a quick recovery in infrastructure space. Their balance sheets are stretched, execution is still not happening, so clearly there are issues which will not go away soon. There needs to be a significant change in policy confidence, which is not going to come in a hurry. Therefore, the public sector banks will bear the brunt of this and which is why the markets have been differentiating between public sector and private sector banks.

There doesn’t seem to be a quick way out of the woods for infrastructure, and the public sector banks exposure to these companies.

MUMBAI: Markets have corrected sharply on concerns about a halt in quantitative easing in the US, which spooked investors. China's flash HSBC Purchasing Managers' Index for May, which fell to 49.6, for the first since October also led to a global sell-off.

Reacting to the meltdown in global equities, Finance Minister P Chidambaram said that the US Federal Reserve Chairman's statement has been misunderstood by the market. He said that foreign inflows into India in May have been copious and there is no need for investors to be nervous.

According to him, WPI inflation has come down below 5 per cent and investors should look forward to next quarter with greater confidence.

According to analysts, the current correction in Indian markets is on account of profit booking after the recent sharp rally and bearish sentiment in global markets. Fundamentally, there is no strong reason why the investors would exit the Indian equities at a time when the interest rates are expected to go down. They don't expect heavy outflows from the FIIs but some moderation in inflows is not ruled out if the US markets continue to move higher.

"This fall is like a blessing as we feel the Nifty will bottom out by roughly correcting 1-1.5 per cent and then stage a rally all the way to 6,400-6,500 in next 5 - 6 months. Best sectors to go long at the time of recovery would be banks, metals, capital goods and cement," said Manoj Muralidharan, AVP- Derivatives, IIFL PReMIA.

At 01:40 p.m., the S&P BSE Sensex was at 19,753.12, down 309.12 points or 1.54 per cent. It touched an intraday low of 19,697.44 and a high of 20,027.56.

The S&P BSE Midcap Index was down 1.85 per cent and the S&P BSE Smallcap Index fell 1.90 per cent.

Standard & Poor's reiterated its negative rating outlook on India's credit rating, which is one notch above junk status, warning of risks if the government carries out less reform than the agency says is needed to boost growth.

The rating agency, which warned of at least a one-in-three chance of a downgrade within the next 12 months, said the major risks for a lower rating are a high fiscal deficit and heavy government borrowing.

India's benchmark 10-year yield rose 4 basis points to 7.41 percent from levels before the statement. The yield closed at 7.39 percent on Thursday.

"If India's general government fiscal or current account deficits worsen contrary to our expectations, we may lower the ratings," S&P said in a release on Friday, after affirming India's BBB- rating with a negative outlook.

Finance Minister P Chidambaram has said he will stick to a budgeted fiscal deficit target of 4.8 percent of GDP in the fiscal year ending March 2014 after being able to restrict the deficit to around 5 percent in the previous fiscal year.

"We may revise the outlook to stable if the government carries through with its plans to unleash public and private investments (for example, by enacting the land acquisition bill), to implement a nationwide government sales tax, or to further trim fuel and fertilizer subsidies," S&P said.

India's growth slipped to a decade low of 5 percent in the fiscal year that ended in March 2013 after posting nearly double digit growth in 2008. Recent corruption scandals have prevented the government from passing key reform bills in the parliament.

NEW DELHI: Indian markets are likely to trade in a range with a positive bias on Wednesday. The immediate support level for Nifty is around 5981.

"The Nifty is expected to head higher till 6080. In this period the key support will be at around 5981 and resistance will be at 6050," said Somil Mehta, Senior Tech Analyst (Equity) at Sharekhan.

"The Nifty has closed above the 78.6% retracement level (5971; that is the 78.6% retracement of the fall from 6111 to 5477), which was a very crucial resistance," he added.

Mehta is of the view that the short term bias for the Nifty remains positive for a target of 6111 with reversal around 5925. The medium-term outlook also remains positive with reversal around the 20-daily moving average (DMA).

Here is a list of thirteen stocks which are likely to remain in focus in morning trade:

HDFC Ltd will be in focus ahead of its quarterly results. It is expected to report net profit of Rs 1515 cr for the quarter ended March 2013 up 14.2 per cent YoY, as compared to Rs 1326.10 crore reported in the year ago period, according to ET Now estimates.

Glenmark Pharmaceuticals Ltd BSE 1.80 %, after the company posted 10.93 per cent rise in consolidated net profit at Rs 166.79 crore for the fourth quarter ended March 31, 2013, on the back of robust sales in both international and domestic markets.

Shriram Transport Finance Ltd, after the non-banking finance company reported a 16.63 per cent rise in consolidated net profit at Rs 383.46 crore for the fourth quarter ended March 31, 2013, driven by a sound rise in loan growth.

Ceat Ltd BSE 4.93 %, after the tyre maker reported 32.83 per cent increase in consolidated net profit at Rs 64.90 crore for the fourth quarter ended March 31, 2013.

Ranbaxy Laboratories Ltd will be in focus ahead of its quarterly results. The pharma major is expected to report a net profit of Rs 163 cr for the quarter ended March 2013, as compared to Rs 1247 cr reported in the year ago period.

Reliance Industries Ltd, after the government has asked for certain clarifications from RILBSE 0.10 % on the revised investment plan the company had submitted for the main gas producing fields in the eastern offshore KG-D6 block.

NMDC Ltd BSE 0.15 %, after state-owned company is now examining two proposals for acquiring coal mines in the African country.

Infosys Ltd, after country's second largest software firm, said it has partnered with enterprise solutions provider SAP for developing mobile applications for the retail industry.

Wipro Ltd BSE 0.26 %, after the software exporter said it is investing $ 30 million for a minority stake in New Jersey headquartered big data analytics firm, Opera Solutions.

GlaxoSmithKline Pharmaceuticals BSE 1.75 %, after the pharma major reported a 37.52 per cent rise in its net profit to Rs 169.01 crore for the first quarter ended March 31, 2013 from the same period previous fiscal.

Axis Bank Ltd BSE -0.58 %, after the private sector lender will replace state-run Bank of India (BoI) as the trustee bank for the National Pension System (NPS) from July onwards.

UCO Bank BSE -4.08 %, after the bank reported nearly 80 per cent slide in its net profit figure to Rs 50 crore for the quarter ended March 31, 2013. Provisioning increased by 114 per cent to Rs 977 crore (Rs 456 crore).

Dewan Housing Finance Ltd (DHFL), after the company recorded over two-fold jump in net profit at Rs 196.93 crore for the fourth quarter ended 31 March 2013.

NEW YORK: US stocks traded mostly higher on Tuesday, paring initial losses, as home prices and consumer data offset a decline in regional business activity.

Technology stocks led the gainers in the S&P 500, which closed at a record high on Monday. The benchmark index was on track to post its sixth consecutive month of gains.

Apple shares rose 2.3 per cent to $438.83 to lead the S&P 500 slightly higher. The iPhone maker came to market with what could turn out to be the largest non-bank bond sale in history, as it seeks funding to return cash to shareholders.

On the economic front, US home prices rose in February at their fastest rate in almost seven years while consumer confidence rebounded in April. However, business activity in the US Midwest unexpectedly contracted in April to its lowest level since September 2009.

Any pullback in the market has been viewed as a buying opportunity, traders and analysts said.

"The consumer confidence data seemed to mark the lows in the market," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

"The continued market strength is drawing people reluctantly off the sidelines and into equities. Whether you want to buy stocks or not, the strength is forcing your hand."

The Dow Jones industrial average fell 10.12 points or 0.07 per cent, to 14,808.63. The S&P 500 gained 1.04 points or 0.07 per cent, to 1,594.65. The Nasdaq Composite added 14.8 points or 0.45 per cent, to 3,321.82. Equities continue to draw support from expectations that central banks will maintain low interest rates and other economic stimulus measures. A statement from the Federal Reserve due Wednesday is expected to keep in place the central bank's pace of bond buying to stimulate the economy.

The European Central Bank will meet on Thursday. A Reuters poll of economists showed policymakers are expected to cut interest rates.

The S&P 500 ended at an all-time high on Monday as growth-oriented stocks, including energy and technology shares, drove the index's sixth rise in the past seven sessions.

A positive finish to April would deliver a sixth straight month of gains. That would be the longest winning streak since September 2009, when the S&P 500 rallied for seven straight months. The broad market index is up 1.6 per cent for the month.

"Short interest is rising, but the market continues to move higher. If the S&P were to break over 1,600, we could see a monster short squeeze," said Jim Brown, editor of options analytics firm optioninvestor.com, in a note late on Monday.

Pfizer shares weighed on the Dow industrials after the drug maker posted lower-than-expected quarterly earnings and revenue, and trimmed its full-year profit outlook. Its stock fell 3.3 per cent to $29.42.

US retailer Best Buy retreated from its ill-fated European expansion by selling its stake in a joint venture to Carphone Warehouse Group for less than half what it paid five years ago. Best Buy shares jumped 8 per cent to $26.14.

Shares of security software maker Symantec Corp dropped 10 per cent in a span of a few seconds before trading was halted. Equity traders called the move another single-stock "flash crash," in reference to the May 2010 selloff when the Dow fall more than 600 points in a matter of minutes. Symantec was down 1.2 per cent at $24.30 at midday.

Well, at the cost of not appearing like a soothsayer, why you want to predict and take money off before the market kicks you out? Always have a point in the market where you will decide that the trend is now over and that point needs to be updated on a daily basis. Today, that point is 5850.

In case tomorrow, 5850 is taken out, you exit your longs and the story is over. In case we get up to 6000, your stop moves higher to may be towards 5920-5950. So, keep updating yourself because nobody can say from where exactly the market will turn.

You sell today and the market goes up 200 points, but there is a regret, so it is better to just keep trailing the market. It is a strong market, hence trailing your stop does make sense.

You would not like to trail in a weak sideways kind of choppy market, but in a trending market, the view has to be that we try to push the trend as far as possible.

Here are four stocks to track in volatile markets:

Motherson Sumi Ltd: The big trend identified by experts is decline in commodity prices, and investors can look at stocks which will get benefited because of softening commodities.

Motherson Sumi is one such stock which matches the criteria. Along with that, there are multiple factors which are in its favour.

Its global subsidiary SMR is turning around and the management is confident that despite a visible slowdown, demand from some of their top clients, which include names like Volkswagen, Audi and Mercedes, will remain intact.

Management is also confident that at a global level, things will improve.

"The company is confident about achieving its 40% ROCE target and exceed $5bn revenue target for FY15. Domestic business has seen strong growth of over 25 per cent despite lack of car sales growth," BofA-ML said in a report.

"Improvement in margin and ROCE of overseas subsidiaries like SMR and SMP is on track. The loss making Brazil unit is a concern and may take six months to improve," added the note.

Global investment bank Espirito Santo reiterates its 'BUY' rating on the stock with a target price of Rs 276
.
Jubilant Foodworks Ltd:

Analysts say it's a great franchise and Dominos Pizza is a household name but in the near term, it appears that the stock has hit some kind of a wall. Jubilant Foodworks is a great brand. However, what is not growing for the company is the same store sales.

Same store sales for Jubilant Foodworks are not growing and the Dunkin' Donuts franchise's operating profit margins in the near term will remain under pressure.

Most of the stores currently owned by Jubilant Foodworks are due for renewals, which means operating profit margins for FY14 will be under intense pressure.

Jubilant Foodworks has not been a great wealth creator this year. Most of the brokerages, except CLSA and Deutsche Bank, are now finding little merit in advising their clients to buy Jubilant Foodworks.

Deutsche Bank maintains a 'buy' rating on Jubilant FoodWorks and has also upped the price target from Rs 1260 earlier to Rs 1300.

The brokerage see 4 key drivers of stock price in the short term - guidance on same store sales growth, new stores addition, cash utilization and lastly guidance on losses from Dunkin Donuts business.

CESC:
Calcutta Electric Supply Corporation has plunged over 10 per cent so far in the year 2013 but analysts see silver lining in the fall and expect it to bounce back in near term.

According to analysts, electricity tariffs have been hiked in Kolkata in last quarter and the effect of that will be visible in the balance sheet of CESC in the coming quarters.

CESC is also the parent company and holds majority stake in the retail chain Spencer. At a time when retail sales were subdued, Spencer bucked the trend, whereas it's larger peers Pantaloon and Shoppers Stop reported a de-growth in their same store footfalls.

The management has indicated that if not in FY14, maybe by beginning of FY15 they may seriously consider de-merging the retail arm and the electricity arm.

The company is also mulling to take Spencer public. The management sounds confident of achieving their FY13 guidance.

Experts say valuations for CESC are mouth wateringly attractive and the stock is not trading at sub-book levels. So for a company of that pedigree and for a franchise of that quality, if the stock is available below book, it is a good time to buy.

United Phosphorus Ltd:

This is one stock which has disappointed lot of fund mangers and long term investors. However, if we look at the business dynamics, there is a case for changing fortunes for the stock.

Cash flow from Brazil will improve and the company has a very strong focus on emerging markets. However, what might pose a problem for United Phosphorous is its strong ownership pattern.

Most of local and global mutual funds have a large exposure to United Phosphorus. So if the stock appreciates to Rs 130-135 in the short term, we may see some profit booking.

If the business dynamics change, such as appreciation in currency or good monsoon, there is a strong case that it might just bounce back.
 

MUMBAI: The Nifty opened on a subdued note and registered a low of 5500.30 in the initial days of the week. With Thursday's upmove, the index witnessed a high of 5794.35 levels. Eventually, it closed near highs at 5783.10, with a robust gain of 254.55 points for the week ended April 18.


The index took support around 5500 levels and witnessed a strong short covering rally which pushed it to close above 5780 levels. Going forward, the Nifty has immediate resistance in the range of 5845 - 5870 followed by 5976 levels.

Any supply from 5870 levels can lead it to plunge up to the levels of 5700 /5660, followed by 5550.

Here is a list of top five trading strategies for the coming week:

Kotak Mahindra Bank: 'BUY' for a target of Rs 690 and with stop loss of Rs 649.40



On the daily chart of Kotak Mahindra BankBSE 1.19 %, we can see that the stock has been trading in an upward sloping contracting channel for the past few months. In the last week, the stock took support from its support trend line and witnessed a strong pullback.

With this pullback, the stock has registered an intermediate breakout on the back of heavy volumes. The stock has taken support from its long term moving average and is currently trading above its cluster of moving averages.

The stock has also closed above its upper end of Bollinger band. The momentum indicator is also rolling upward. We recommend 'Buy' now and again on dips up to Rs 658--664 with a stop loss placed below Rs 649.40 for targets of Rs 690 /710 levels.

Century Textile and Industries Ltd: 'BUY' for a target of Rs 312 and a stop loss of Rs 290.40


On the weekly chart of Century Textiles, we can see that the stock has been declining for past couple of months. In the last week, the stock has taken support at its rising trend line and formed a bullish candlestick pattern (as shown in the chart).

On the daily chart, the stock is trading above its short term of moving averages. The momentum indicator has taken support from oversold zone and rolling upward.

We recommend buying now with a stop loss placed below Rs 290.40 for targets of Rs312/324 levels.

Karnataka Bank: 'BUY' for a target of Rs 152 and a stop loss of Rs 141.80

The share price of Karnataka BankBSE 1.32 % has been trading in a declining channel for past couple of months. Last week, the stock has registered a breakout from this down sloping contracting channel.
The stock is also trading above its cluster of moving averages as well as closed upper end of Bollinger band. The momentum indicator is also rising. Going forward the stock is likely to head towards the declining gap witnessed on 21st Feb 2013.


Traders can create long position now and again on dips up to Rs 144-145 with a stop placed below Rs 141.80 levels, for targets of Rs 152/156/160 levels.

Tech Mahindra Ltd: 'SELL' for a target of Rs 920 and a stop loss of Rs 955



Tech Mahindra has been trading in a sideways range for past couple of weeks. This sideways momentum has taken the form of a head and shoulder pattern. With Thursday's down move, the stock has registered breakdown from the said pattern.

The stock is finding resistance from its near term moving average and declining. The momentum indicator is also rolling downward.

Traders can create short position now and again on rise up to Rs 955-962 with a stop placed above Rs 978.20 levels, for targets of Rs 920/900.

Tata Global Beverages Ltd: 'BUY' for a target of Rs 144 and a stop loss of Rs 137

The share price of Tata Global has been declining from the highs of Rs 181.50 for past couple of months. In this week, the stock has witnessed strong pullback which pushed it above its cluster of moving averages.



In the intraday chart, the stock has registered breakout from its inverted head and shoulder pattern on the back of heavy volumes. The stock has also closed above its cluster of moving averages as well as closed above upper end of Bollinger band.

We recommend 'buy' now and again on dips up to Rs137-138 with a stop loss placed below Rs 133.80 for the targets of Rs 144/148 levels.

NEW DELHI: The S&P BSE Sensex managed to recapture its key psychological level of 19000 in a volatile trade on Thursday and ended the week with gains of over 770 points, or 4.24 per cent.

The 50-share Nifty index also managed to recapture its key psychological level of 5700 and ended the week with gains of over 250 points or 4.6 per cent.

Markets have been in an upward trajectory throughout this week largely on hopes of monetary easing by the Reserve Bank of India, after inflation and current account deficit numbers showed some moderation.

"The Nifty had shown a strong recovery from low of 5477 level in this week and has already gained by about 4.5 per cent in this week," said Rakesh Goyal-Senior Vice President, Bonanza Portfolio Limited.

"Fall in gold prices and oil along with fair valuations seen at lower levels has led to this strong rally. However, since Nifty had been in downtrend for quite some time, profit-booking is likely near 5800 levels," he added.

Nifty has once again entered above 200-DMA level, which is a positive indicator in near term. Last quarter results for this fiscal along with global cues shall remain in focus for coming sessions.

"Investors will continue to put their money into sectors such as defensives, particularly pharma and FMCG where corporate earning visibility is positive," Nirmal Jain, Chairman, India InfolineBSE 1.08 % said in an interview with ET Now.

"In the past banks had gone through some bit of correction and the current valuations have become attractive. Private sector banks particularly will find more interest from the US side," he added.

After a series of bad news on politics, growth and interest rate outlook, India has seen some relief from falling commodity prices, especially gold and oil.

According to analysts, moderation in inflation numbers and commodity prices are likely to support RBI in easing monetary policy next month, which in turn has resulted a sharp rise in beaten down rate sensitive stocks.

"The downtrend in commodities is clearly good for the economy and eases the tail risks on the twin deficit to some extent," BofA-ML said in a note. "We continue to have a mix of rate sensitives like autos, banks and defensives stocks such as pharma in our model portfolio," the note added.

The market has a positive co-relation with crude as well as the CRB index reflecting the impact of global risk appetite on India, say analysts.

"In periods of a sharp fall in commodity prices, markets have on an average given a positive return of 4 per cent over 3 months with a 2 months lag," added the BofA-ML note.

BofA-ML is factoring a rate cut of 100 bps this fiscal, while Kotak expects 25 bps repo rate cut on May 3 and another 50 bps repo rate cut in two installments by end-CY2013.

Five stocks that touched 52-week highs

Sun Pharma: The stock has been in an upswing for the entire week and has gained nearly 5 per cent. The stock touched its 52-week high of Rs 925 on Thursday. However, towards the end the stock closed 0.04 per cent lower at Rs 916.05.

Lupin Ltd: The stock touched its 52-week high of Rs 685.70. However, towards the end of the week the stock pared most of its gains and closed 0.3 per cent lower at Rs 670.80.

ITC: Defensives have been the flavour of the week for markets, with ITC hitting fresh record highs on a regular basis. ITC surged over 1 per cent to hit its 52-week high of Rs 316.35. It closed 0.7 per cent higher at Rs 315.30.

Alembic Pharma: Pharma stocks have been on a roll this week. The stock has managed to gain nearly 10 per cent so far. The stock rose over 1 per cent to hit its 52-week high of Rs 120. However, it pared most of its gains and closed 0.4 per cent lower at Rs 117.90.

IndusInd Bank: The private sector bank surged over 8 per cent to hit its 52-week high of Rs 455.70, after it posted 37.6 per cent jump in net profit at Rs 307.40 crore for its fourth quarter ended March 31, 2013.

MUMBAI: Once accumulated as wealth by families to tide over rough times, gold has been reduced to a trading commodity. In the last few days, prices have plunged to register its biggest loss in more than three decades.

Gold prices have declined nearly 20 per cent while silver is down 23 per cent in 2013. International insiders report that four major fund houses shorted the commodity, which led to sharp declines on Friday, only to be followed up in Asia. The selling soon got out of control as margins and stoploss triggers came into play.

The gold prices have now officially entered the bear market with more than 20 per cent decline since its record highs above $1,900 in 2011 end.

Indian gold prices have declined less as the fall is cushioned by weakness in the Indian rupee. But here too, the prices have come off the record highs of nearly Rs 33,000 in 2011 to Rs 25,500 per 10 gms today. Gold prices in India hit a 19-month low while silver was at 26-month low and trading below Rs 44,000 per Kg.

The decline in gold led to Indian jewellery and bullion traders lowering shutters due to sharp decline in prices as they incur losses on holding stocks. The sellers are awaiting stability in prices before they quote prices.

In India, wedding season and Akshay Tritiya on May 13 are major buying events, which are expected to lend support to falling prices. Gold prices have seen some rebound from Boston bombings and war rhetoric from North Korea.

The forecast for gold is a difficult one to make right now. Most market analysts and participants feel that 2013 now will go down as a corrective year for precious metals and consolidate for a couple of years with modest gains.

The safe haven buying into the metal has been weak on inflation concerns and hopes of pick-up of growth in the US. While the economic growth data has not been consistent, but it has been getting better, leading to money flowing in equities. Another factor that led to onslaught on commodities was the lower than expected China growth data.

There are reports that Cyprus may be selling 12.5 tonnes of gold. Though the quantity is less than a weekly consumption in India, there is a fear that other EU countries with higher gold reserves could come into the market for sales.

There are also reports of Merril Lynch selling 4 million ounces on Comex which collectively led to decline in prices. To add to it, there has been a bearish gold report from Goldman Sachs that pushed buyers on sidelines. An opportunity selling that turned into panic selling and is now termed as Flash Crash.

The trading margins have increased across at Comex, Shanghai and Indian MCX as well and trading volumes have hit record highs on India's MCX and COMEX in US.

It augurs well with the Indian government which has been trying to discourage gold buying due to its impact on the current account deficit. India, China and much of Asia continue to be big buyers of gold.

NEW DELHI: Investors can expect an annualised return of over 15 per cent from the stock market in the long term from the current valuations -- earning them a premium of 7-7.5 per cent over the returns from the relatively risk-free government bonds, says a study.

"Current Sensex market capitalisations imply a long-term return expectation of over 15 per cent," according to the study conducted by global consultancy major PwC about Indian markets.

PwC said that the projected long-term return of 15.2 per cent for the 30-share index Sensex is based on the current market capitalisations, free cash flows and the expected growth rates.

This would imply an Equity Risk Premium (ERP) -- the difference between the returns from higher-risk equity market and those from the relatively risk-free government bonds -- of 7.2 per cent at the current level, given a yield of 8.05 per cent on 10-year government securities December 31, 2012.

"The study concludes that considering the daily fluctuations in equity market valuations as well as government security yields, the current ERP can be considered to be in the 7 -7.5 per cent," PwC said, adding that the equity risk premiums are dynamic and subject to constant change.

ERP is the excess return that an investor expects as compensation for bearing the risk of investing in the equity markets, instead of investing in a risk free asset.

While there are no securities that are 100 per cent risk free, the yield on the 10-year rupee denominated government securities can be considered as a suitable proxy for a risk free rate, the study said.

Den Networks LtdBSE 1.16 % is a 'BUY' call with a target of Rs 218 and a stop loss of Rs 203

Lupin LtdBSE 2.35 % is a 'BUY' call with a target of Rs 665 and a stop loss of Rs 639

Biocon LtdBSE -0.83 % is a 'BUY' call with a target of Rs 302 and a stop loss of Rs 288

Cipla LtdBSE 0.68 % is a 'BUY' call with a target of Rs 420 and a stop loss of Rs 399

Aurobindo Pharma LtdBSE 4.94 % is a 'BUY' call with a target of Rs 178 and a stop loss of Rs 163

Maruti Suzuki LtdBSE -0.63 % is a 'BUY' call with a target of Rs 1475 and a stop loss of Rs 1410

Biocon Ltd is a 'BUY' call with a target of Rs 311 and a stop loss of Rs 288

Divi's Laboratories LtdBSE -0.61 % is a 'BUY' call with a target of Rs 1075 and a stop loss of Rs 1021

PTC India LtdBSE -2.31 % is a 'SELL' call with a target of Rs 55 and a stop loss of Rs 60.10

JSW SteelBSE 1.80 % Ltd is a 'SELL' call with a target of Rs 625 and a stop loss of Rs 666

Biocon Ltd is a 'BUY' call with a target of Rs 306 and a stop loss of Rs 288

Aurobindo Pharma Ltd is a 'BUY' call with a target of Rs 178 and a stop loss of Rs 163

IndusInd BankBSE -0.84 % is a 'BUY' call with a target of Rs 415 and a stop loss of Rs 394

Dish TVBSE -3.64 % Ltd is a 'BUY' call with a target of Rs 77 and a stop loss of Rs 69

RILBSE 0.50 % Ltd is a 'SELL' call with a target of Rs 745 and a stop loss of Rs 770

The Indian markets may open on a positive note tracking positive Asian cues. SGX Nifty is also trading 26.00 points higher.
Headlines for the day

• BHEL's Tiruhcy complex to diversify into defence.
• ONGC inks MoU with KK Birla Group company for fertiliser unit.
• RIL sniffs gas in first exploration well in 5 yrs.
  
  Daily trend of FII/MF investment in equities:
  The FIIs have been the net sellers Indian stocks to the tune of Rs104.20 crore on April 08, 2013. The domestic investors sold Indian shares worth a net of Rs37.20 crore on April 08, 2013. The data is as per the SEBI website.
  
  

NEW DELHI: The S&P BSE Sensex was trading in a narrow range with a positive bias on Tuesday, led by gains in realty, metals, banks and capital goods sectors on the back of supportive cues from global peers.

According to analysts, corporate earnings for quarter ended March and global economic situation are likely to decide the course of market in the near term.

At 10:20 a.m.; the 30-share index was at 18,457.08, up 20.30 points or 0.1 per cent. It touched a high of 18,521.73 and a low of 18,456.65 in trade today.

The Nifty was at 5,564.40, up 21.45 points or 0.4 per cent. It touched a high of 5,580.60 and a low of 5,563.40 in trade today.

"The Nifty is expected to head lower till 5500. In this period the key support will be at around 5500 and resistance will be at 5612," says Somil Mehta, Senior Tech Analyst (Equity) at Sharekhan.

"The Nifty has again faced resistance around the 20-daily moving average (DMA) and also broken the previous swing low on the weekly chart which indicates weakness in the short term," he added.

Mehta is of the view that for the Nifty the short-term bias would remain negative for a target of 5450 with reversal around 5756. The medium-term outlook would remain negative.

Here is a list of sixteen stocks that are in action in morning trade today:

Telecom stocks will be in focus, after the Supreme Court allowed the telecom companies to continue 3G pacts until next hearing on April 11.

At 10:20 am, Bharti AirtelBSE -1.87 % was trading 2.1 per cent lower at Rs 275.20. Idea Cellular BSE -0.98 % was trading 1.3 per cent lower at Rs 105.60.

Wipro LtdBSE -10.75 % plunged over 11 per cent in early trade on Tuesday, after the IT major hived off its non-IT business into an unlisted entity to comply with Sebi's minimum public shareholding norm.

At 10:20 am, Wipro was trading 9.7 per cent lower at Rs 405.25.

TVS Motor Company LtdBSE -9.91 %, after the Chennai-based two-wheeler major entered into a long term co-operation with BMW Motorrad to develop and produce new series of sub-500cc motorcycles.

At 10:20 am, TVS Motor was trading 8.2 per cent lower at Rs 36.60.

IL&FS Transportation Ltd, after the infrastructure company said it had won a Rs 1,665 crore project from NHAI for widening of highways stretches in Jharkhand and West Bengal under the flagship road building programme NHDP.

At 10:20 am, the stock was trading flat at Rs 185.25.

Adani Power, Tata Power, Essar Power and JSW Energy will be in focus after the Directorate of Revenue Intelligence (DRI) accused a number of prominent companies in the power and cement sectors of using a loophole in the law to dodge import duty amounting to about Rs 2,500 crore on coal imports.

The agency has questioned officials of Adani Power, Tata Power, Essar Power and JSW EnergyBSE 1.96 % and other companies on coal imports worth about Rs 28,000 crore, ET reported.

At 10:20 am, Adani PowerBSE 4.19 % was trading 4.2 per cent higher at Rs 48.50, Tata PowerBSE 0.21 % was trading flat and JSW Energy rose 1.6 per cent higher at Rs 56.90.

Reliance Industries Ltd, after the oil & gas major stopped gas supplies to power plants after its KG-D6 output hit an all-time low, prompting Power Minister Jyotiraditya ScindiaBSE -4.96 % to press for convening an urgent meeting of a ministerial panel to rework allocations

he key Indian indices ended in red for third session on continuous selling pressure led by weak global and domestic environment. The BSE Sensex slipped 59 points and the Nifty closed 22 points lower in trade today.

 Major headlines

• Bank credit to industry up 14.7% in February 2013
• Diageo refuses to lift United Spirits offer price
• Maruti Suzuki rallies on weaker yen currency
• Sugar stocks jump as CCEA OKs partial decontrol

 Indian indices
The key benchmarks closed in the red zone as the equities traded on a subdued note led by selling pressure across the board. The Indian markets witnessed another weak trading session amid volatility in FMCG, CD, CG, Power and Bankex shares. The BSE Sensex fell for a third consecutive session on Friday as concerns that foreign investors would exit some of their holdings due to domestic and global uncertainties continued to hit blue chips such as ITC and ICICI Bank. The broader markets ended on mixed note. At the closing bell, the BSE Midcap index rose 0.02%, while the BSE Smallcap index was down by 0.15% leading to strong market breadth. The BSE Sensex fell 0.32% while Nifty ended 0.39% lower.

Movement of the Indian indices for the day

Indian stock markets extended previous session's losses leading to another weak session with negativity hovering all over the D Street today. Indices started trading in the red zone and remained listless for major part of the day. Equities did enter the green territory to  trade positive for a while raising investor's hope but could not sustain gains for long and slipped back to the negative zone. 

Following are the stocks/sectors which were in news today: Shares of sugar manufacturers rallied up to 20% in opening deals after the Cabinet Committee on Economic Affairs (CCEA) approved a proposal to abolish the levy-sugar mechanism, under which private millers have to sell a specified quantity of the sweetener to the government at concessional rates. Bajaj Hindustan, Shree Renuka Sugars, Balarampur Chini Mills, Mawana Sugars, Oudh Sugars and Dhampur Sugar Mills traded 10-20% higher in trade today.  Maruti Suzuki India rose 7.23%, on hopes that a weaker yen currency would improve margins by reducing the costs of importing auto parts from Japan after the Bank of Japan unleashed unprecedented monetary expansion.  United Spirits fell 3.75% after UK drinks group Diageo Plc opted not to lift its offer price of Rs1,440 as it looks to raise its stake in the company.

Market sentiment The market breadth stood in favor of advances. Of the 2866 stocks traded on the BSE, 1422 (49.62%) rose, 1306 (45.57%) fell and 138 (4.82%) stocks remained unchanged.

Sectoral & stock screening
Among the 13 sectoral indices, eight sectors closed in the red zone while remaining five sectors closed in the green zone. Top Gainers- BSE Oil&Gas up by 1.65%, BSE Auto rose by 0.55%, BSE Metal surged 0.31%. Top Losers: BSE FMCG was down by 1.74%, BSE CD fell by 0.78% and BSE CG declined by 0.72%

Among 'A' group stocks, top three gainers were- Indraprastha Gas rose by 11.45%, Maruti Suzuki was up by 7.23% and Motherson Sumi surged by 4.72%. Top three losers were- NMDC declined by 4.48%, Exide Industries was down by 3.84% and United Spirits fell by 3.75%.  

Global signals
Asian shares hit a three-month low on Friday as concerns over bird flu in China and escalating tensions in the Korean peninsula unsettled investors as they counted down to potentially pivotal U.S. payrolls data out later in the session.

European shares hit a one-month low on Friday as investors braced for potentially weaker-than-forecast U.S. payrolls data due later, while many of Europe's sovereign bonds jumped on talk of Japanese demand.

US stock index futures pointed towards a lower opening at the Wall Street on Friday.  

Major headlines

• India's HSBC Services PMI at 51.4 in March
• Welspun Corp zooms on stake buy
• Ajanta Pharma at record high, stk up 13%
  Indian indices
  The Indian markets closed in the red zone as the equities traded on a subdued note led by selling pressure across the board, weak global sentiments, fall in rupee and poor HSBC Service PMI numbers for the month of March. Benchmark share indices witnessed weak trading session amid volatility in auto shares and index heavyweights like RIL and L&T which dragged markets lower. The broader markets too ended in red. At the closing bell, the BSE Midcap index slipped 0.94%, while the BSE Smallcap index was down by 0.54% leading to weak market breadth. 
  Movement of the Indian indices for the day
•  
  D Street witnessed a disappointed trading session as markets reversed gains accumulated in a four day rally and posted the biggest fall in last two weeks. Key benchmark indices opened in red owing to unsupportive global cues. Equities did try to erase early losses during early noon trades but remained in red terrain owing to profit booking in majority of the sectors.
  
  Following are the stocks/sectors which were in news today:
  
• Adani Power jumped 8.79% after a newspaper reported that regulators would allow the power utility company to raise tariffs for electricity provided from its plant in Mundra in the state of Gujarat.
  
• Welspun Corp gained 3.13% after Nippon Investment and Finance Co raises stake in the company to nearly 2.1% from 1.55% earlier through open market transactions.
  
• SRF rose 1.45% after the company said it has commissioned and capitalised a multipurpose chemical plant at Dahej in Gujarat on February 28, 2013.
  
• MOIL jumped 2.72% after the company said it had hiked prices by 9% across its product basket for the April-June 2013 quarter.
  
• Ajanta Pharma jumped 19%, to record new high on NSE; on back of heavy volumes after the company said its promoter along with foreign institutional investors (FIIs) have raised their stake in the company during March quarter. The stock closes 13.61% higher in trade today
  Sectoral & stock screening
  Among the 13 sectoral indices, eleven sectors closed in the red zone while remaining two sectors closed in the green zone. Top Gainers- BSE HC up by 0.17% and BSE Power rose by 0.06%. Top Losers: BSE Realty was down by 2.68%, BSE CG fell by 2.29% and BSE Auto declined by 2.23
  
  lobal signals
  Asian shares ended mixed on Wednesday (April 03, 2013), cautiously marking time before key US jobs data and news from central bank policy meetings in Japan and Europe later in the week.
  
  European shares and the euro eased while German bonds were flat on Wednesday as investors awaited this week's policy decisions by the Bank of Japan and European Central Bank followed by U.S. employment data.
  

Auto:

Axis CapitalBSE -0.19 % expects demand to recover from FY14 driven by increasing money supply in the system, falling interest rates, and pre-election consumption stimulus. However, we lower our FY14/ FY15 industry volume estimates to factor in higher fuel pass through and inflationary pressures.

Lower than expected economic recovery can impact volumes and valuation multiples.

Banks:

Banks with retail focus (mainly private) would be major beneficiaries of pick up in consumption-related demand. We prefer HDFC BankBSE -0.03 %, ICICI BankBSE 0.62 % and LIC HousingBSE 0.67 % in the space.

Key triggers will be policy rate cuts and signs of revival in capex demand. Increase in FDI in insurance will unlock value mainly for ICICI Bank, HDFC and SBIBSE 0.86 %.

Key developments expected: New bank licenses to bring new business models (eg. Yes BankBSE 0.70 % and Kotak created niche models which suited their product offerings) and improve competitive landscape.

Cement:

Cement demand has been weak since Nov '12 and is unlikely to recover over next six months. FY13 demand growth is expected to be 2 per cent. We have lowered our CY13/CY14 EPS estimates for ACCBSE -0.19 % and Ambuja by 10-18% to factor in (a) cost pressures in coal and freight and (b) subdued cement prices in the near term.

Demand growth is expected to recover to 6 per cent in FY14 and 8 per cent in FY15 led by pre-election spending and expected recovery in capex. Slow pace of fresh capacity additions to lead to improved capacity utilizations.

Steep increase in coal and logistics costs, thus limiting industry's ability to pass on cost pressures are some of the key risk factors for the sector.

Engineering:

Our channel checks suggest recovery from FY14 driven by capex in Railways (tariff hike+ DFC+ Metro), Oil & Gas (largely RILBSE 0.58 % & ONGCBSE -1.08 %), and Power Distribution (SEB debt restructuring). Power (Generation & Transmission), Metals and Roads will remain weak. We expect L&T and ThermaxBSE -0.49 % to be the key beneficiary of this capex.

We expect execution growth to pick-up in FY14 driven by government push to kick start the investment cycle by forcing cash rich PSUs do capex (or pay dividend) in the pre-election year. We expect revenue growth of 12 per cent for L&T and 22 per cent for Thermax in FY14.

FMCG:

Squeeze in disposable income and weak sentiments impacted off-take in select discretionary categories. Revenue growth for 9MFY13 was at 16 per cent YoY (vs. 19.5 per cent in FY12).

We expect pre-poll spending, increase in planned expenditure by government, and moderation in inflation levels to drive consumption demand. Expect revenue growth of 17 per cent in FY14.

Rupee depreciation will be a mixed bagger. It will negatively impact companies with higher imported raw materials content such as Asian PaintsBSE 0.66 % and HULBSE 1.17 %. No major P&L impact on companies with sizable US$ denominated debt (Dabur, GCPL, NestleBSE 0.40 % and Marico) is expected as they follow AS11. Translation gains on exports and international business will have positive impact on reported earnings (not cash flow) of GCPL, DaburBSE 3.36 % and MaricoBSE 0.78 %.

Pricing power may weaken if demand remains sluggish, which could impact operating margin in FY14.

Infrastructure:

While ports exhibited strong volume growth, airport traffic witnessed marginal de-growth. Roads lagged on account of low NHAI awards and players exiting unviable projects, citing delays in approvals.

We expect ports with spare capacity to continue to see strong growth, while a significant improvement in NHAI awards to result in more viable project wins.

Technology:

Key factors are US recovery, concerns on growth from Europe/ BFSI vertical are now abating, deal pipeline is better YoY, better prospects from sizeable renewal market is expected (~USD 220 bn over CY13-15).

Pricing is expected to remain stable as commoditization of the traditional ADM segment (55-60 per cent of revenue) will largely be offset by likely uptick in discretionary spend and new spend areas - cloud, mobility, data analytics etc.

Margins are seen improving by 30-60 bps on higher offshore penetration in Europe and rupee depreciation. We expect part of gains to be channelized towards client mining, non-linear initiatives, S&M investments, expansion at onsite locations etc. However higher depreciation and tax due to onsite investments and lower growth in interest income will lead to lower growth in PAT versus topline.

Metals:

Though we expect a gradual demand recovery in developed countries and China, overcapacity in China will keep metal prices subdued. However, there is limited downside as CMP of non-ferrous metals is at/ below marginal cost of production.

We lower our non-ferrous metal price estimates for FY14 and FY15 by 5-9 per cent. However, domestic metal companies to benefit significantly from expected rupee depreciation. We have raised our FY15 EPS estimates by 10-20 per cent and target prices by ~10-15 per cent.

Further disruption in mining activity is seen as a key risk factor for the sector.

Oil & Gas:

Domestic gas price hike (as per Rangarajan committee's recommendation) would be favorable for RIL, ONGCBSE -1.08 % and OIL. We expect gas price to be hiked to US$ 6/mnbtu (vs. Street expectations of US$ 8/mnbtu) due to likely opposition from fertilizer/ power ministry ahead of elections. Approvals for E&P plans, which have been delayed for long, will improve production outlook for RILBSE 0.58 % and CairnBSE 5.02 %.

Pharmaceuticals:

US is still an attractive market for Indian pharma players. Medium term outlook for the sector: 13-14 per cent p.a. growth; implementation of proposed pricing policy will impact growth, but only in the short-term.



Power:

State governments of three SEBs (TN, Rajasthan, and UP) have approved debt restructuring scheme. These SEBs account for 70 per cent of all-India losses. This will enable them to absorb higher power prices and lead to improvement in PLFs and receivables for gencos.

Coal price pooling mechanism has received approval from the Cabinet. An inter-ministerial group has been set up to sort out issues raised by some states. Success of this scheme is crucial to viability of private gencos dependent on CILBSE -1.25 % linkage and have signed fixed price PPAs.

Merchant prices now showing regional divergence: In 9MFY13, merchant tariffs showed divergent trend with realizations significantly higher in South India at over Rs 5/Kwh vs. East and North India at Rs 3- 3.5/Kwh due to transmission bottlenecks. We expect merchant prices at Rs 3.5-5/kWh in FY14 despite pre-election spike in demand, as banks are unwilling to fund SEBs any further and increasing consumer-level prices will be a challenge

Realty:

While MMR and NCR saw a pick up in volumes towards the end of CY12 (regulatory de-bottlenecking), Bangalore continued to see strong volumes throughout CY12 on account of project launches at regular intervals.

RBI is expected to cut interest rates by 100 bps in FY14 which shall benefit all real estate developers. Possible passage of the Land Acquisition Bill will re-rate land prices, benefiting large land owners ( DLFBSE 7.91 %, JP Infratech, Sobha and Puravankara).

De-bottlenecking of regulatory process shall result in a flurry of new launches which will help revive volumes across micro markets.

Several developers have built up significant quantum of unbooked revenue from projects which are expected to cross revenue recognition threshold in FY14 and thus augment revenue and profitability significantly ( Prestige EstatesBSE 0.49 %, Sunteck RealtyBSE 1.61 %, Oberoi Realty).

Telecom:

Industry consolidation and withdrawal of promotional offers (since August 2012) is to improve RPM. We expect 3.5 per cent/ 3 per cent RPM growth in FY14/ FY15 respectively (50 per cent of our inflation forecast).

Old operators are to benefit as minutes migrate from new operators (few have exited while some like Telewings, Sistema are scaling down operations). Expect old operators to deliver total minutes growth of 6-8 per cent in FY14.

Consecutive failure of auctions (Nov-12 and Mar-13) and increased spectrum supply (Supreme Court directions) will result in lower spectrum prices. Hence, regulatory charges will be lower.

MUMBAI: Leading bourses BSE and NSE have put a price band of 10 per cent on share movements of four firms -- Essar OilBSE 2.11 %, Suzlon EnergyBSE 1.11 %, EducompBSE -0.24 % and CORE Education -- as part of preventive surveillance measures.

The price band will be applicable for trading in the four stocks with effect from April 2. The decision to limit any upward or downward movement in their share prices to a maximum of 10 per cent has been taken by the the stock exchanges in consultation with market regulator Sebi.

In separate notices, NSE and BSE said that a fixed price band of 10 per cent on these four stocks is being imposed as part of a "preventive surveillance measure and to ensure market safety and safeguard the interest of the investors".

The decision was taken in consultation with market regulator Securities and Exchange Board (Sebi), and the action will be reviewed periodically, they added.

With an aim to prevent any systemic risks arising out of erroneous trades or stock manipulations, the market regulator Sebi late last year asked the stock exchanges to put in place a system for 'dynamic price bands'.

These dynamic price bands, which are generally referred to as dummy filters or operating range, prevent acceptance of orders for execution that are placed beyond the price limits set by the stock exchanges.

Such dynamic price bands are relaxed by the stock exchanges as and when a market-wide trend is observed in either direction - a bullish or bearish price movement.

The stock exchanges can also convert these dynamic price bands into 'fixed price bands', if required by the trading pattern of the stocks under review.

In October last year, a set of erroneous orders led to the Nifty briefly crashing by over 15 per cent following which Sebi had issued guidelines that required the bourses to set the dynamic price bands at 10 per cent of the previous closing price.

1-Apollo Tyre Ltd is a 'SELL' call with a target of Rs 76 and a stop loss of Rs 82.70

2-Dr Reddy's is a 'SELL' call with a target of Rs 1,700 and a stop loss of Rs 1,759.

3-HDFC Ltd is a 'BUY' call with a target of Rs 852 and a stop loss of Rs 812.

4-HUL Ltd is a 'BUY' call with a target of Rs 492 and a stop loss of Rs 462.

5-GMDC Ltd is a 'SELL' call with a target of Rs 156 and a stop loss of Rs 168.50.

6-GMDC Ltd is a 'SELL' call with a target of Rs 156 and a stop loss of Rs 168.50.

7-Hero MotoCorp Ltd is a 'SELL' call with a target of Rs 1,510 and a stop loss of Rs 1,600.

8-Sun Pharma BSE -0.24 % is a 'SELL' call with a target of Rs 795 and a stop loss of Rs 831

9-Ranbaxy Laboratories Ltd is a 'BUY' call with a target of Rs 465 and a stop loss of Rs 434

10-BPCL BSE 1.82 % is a 'BUY' call with a target of Rs 390 and a stop loss of Rs 364

DURBAN: In a major achievement for India in its campaign for reforming the international financial architecture, BRICS nations on Wednesday decided to establish a new development bank to finance infrastructure and to create a USD 100 billion Contingency Reserve Arrangement to tackle any financial crisis in the emerging economies.

The decision was taken at the BRICS Summit here which also launched a Business Council to encourage investment and trade in member countries and to expand business cooperation. Leaders of the inter-continental grouping including Prime Minister Manmohan Singh, met here this morning for an extended session and accepted the report of their finance ministers saying "we are satisfied that the establishment of a New Development Bank is feasible and viable".

"We considered that developing countries face challenges of infrastructure development due to insufficient long-term financing and foreign direct investment, especially inestment in capital stock. "This constrains global aggregate demand. BRICS cooperation towards more productive use of global financial resources can make a positive contribution to addressing this problem," the laders said in a statement after the two-hour summit.

However, the leaders did not decide on the capital for the proposed bank leaving it to the finance ministers to negotiate this and other issues before September. The development bank, mooted by India at the last year's Summit in Delhi, was originally proposed to be started with a capital of USD 50 billion with USD 10 billion from each of the members.

Incidentally, differences appear unresolved with reservations from South Africa and Brazil over the contribution. Hailing the development bank initiative along with the other leaders, Singh said it gave him great satisifaction to note that one of the ideas that they discussed first in New Delhi -- that of instituting a mechanism to recycle surplus savings into infrastructure investments in developing countries -- has been given a concrete shape during the Durban Summit.

"Our finance ministers will now work to develop the details of the project," he told a joint press conference with the other leaders.

Besides host President Jacob Zuma, new Chinese President Xi Jinping, Russian President Vladimir Putin and Brazilian President Dila Rouseff participated in the summit. In his address, Zuma said the summit decided to enter formal negotiations to establish a BRICS-led new development bank based on their own considerable infrastructure needs, amounting to USD 4.5 trillion over the next five years and to cooperate with the other emerging markets and developing countries in future.

Briefing reporters after the summit, Finance Minister P Chidambaram said India gave two big ideas, BRICS Development Bank and a Contingency Reserve Arrangement (CRA) at the Delhi summit last year and "they have now become a reality".

"Both the ideas have been approved by the leaders. Whatever the individual views of the finance ministers, the leaders have wholeheartedly welcomed the establishment of the Bank and the CRA," he said noting the Brazilian President's remarks that the capital of the Bank must be commensurate with the challenges and goals of the Bank. He said Putin fully supported establishment of the Bank while China had always been enthusiastic in supporting the Bank.

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