India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details �� ��
Nifty formed falling wedge pattern indicating uptrend
Nifty belled the week on a negative note as heavy sell off was witnessed in front liners banking stocks and Nifty breached the 100 DMA. However, very last day of the week Nifty rebound smartly and closed above 100 DMA to 5857 level. On daily chart Nifty exhibiting "falling wedge" which is bullish breakout pattern if upper trend line breaks. In spite of Friday sharp rise Nifty managed to close just near to upper line of wedge pattern. If Nifty manages to trade above it then we could see upside in forthcoming session otherwise not ruling out the possibility of major correction. For the coming week support for Nifty comes at 5,750-5,822 level while resistance could be seen at 5,946-6,056 level.
In coming week, we expect upward movement as technical momentum indicators are suggesting continuation of uptrend. RSI is on the verge of entering into neutral territory from oversold, showing positive crossover. MACD is crossing its signal line from the below, showing a bullish trend. However, Nifty is currently trading below 8 and 34 Day EWMA showing concern for bulls.
Technical Pick
1. Lupin: (Buy)
2. Natco Pharma: (Buy)
3. Videocon Industry: (Buy)
4. VIP Industry: (Buy)
Buying could be witnessed in Cement, Banking and capital Goods stocks
India’s medium-term growth trajectory remains promising amid a still gloomy world outlook. better diversification in manufacturing & service sector contribution to GDP, underleverage and better demographics will continue to accelerate growth in the Indian economy. The Indian economy has posted yet another quarter of strong growth, with July-September GDP rising by 8.9% y-o-y. Looking ahead, GDP growth would be between 8.5% to 8.75% in the current fiscal that ends in March 2011. Since economies like China and Singapore are at best cautious in their regulation of capital flows, India is likely to see a gush of capital flows, which is likely to push up the stock prices. Further, money that MOIL has attracted will come back into the markets and buoy the indices.The time is right to pick up fundamentally sound stocks which may have got beaten down along with their peers. Cement, Banking, Capital goods and Shipping sectors could be good bet for investors. The next major trigger for the equity market is the advance tax payment of corporates for the third installment, which fdue on 15 December 2010.
Fundamental Pick
1. Bombay Rayon Fashions Ltd. (Buy)
2. Heidelberg Cement India Ltd. (Buy)
Global market will eye on Fed monetary policy meeting
Global market gained during the week. US president Obama"s decision to extend tax breaks bolstered recovery hopes in the world"s biggest economy. Further, better economic data also improved markets sentiments. Japanese national economy rose by 4.5% on an annualised basis while unemployment benefits in US declined more than anticipated in the week. Looking ahead, markets are likely to remain cautious as investors will closely watch Fed monetary policy update, due next week. Moreover, China"s imports and exports stronger than expected growth is most likely implies a fresh monetary policy announcement, and that may well be another interest rate rise. However, in Euro zone, investors will get some relief as a top EU official indicated that debt-strapped Greece will likely to get more time before it has to repay the bailout loans that saved it from defaulting on its bonds.
Tight cash conditions may continue to dampen bond prices
Bond prices may remain under pressure for some more time as system might continue witnessing tight cash conditions. Further, with installments for advance tax payments beginning from December 15, 2010 cash condition may worsen. However, weaker equity market may push demand for safe heaven and may limit the fall. Moreover, investors are keenly watching the headline inflation data due to be released on December 14, 2010 for cues on the monetary policy.
Crude oil prices may tread upwards, gold prices also likely to witness a boost
The crude oil prices may continue with upward trend in the coming week. The prices are likely to edge higher on signals that China, the world’s biggest energy-consuming country, will raise interest rates. Gold prices are also likely to witness a boost in the coming week. As gold prices are sensitive to bond yield, therefore lower bond yields after the 30-year. Treasury auction is likely to lend support to the yellow metal.
No comments:
Post a Comment