The 50-unit S&P CNX Nifty hit four-month closing low and the barometer index BSE Sensex dropped to its lowest closing level in nearly seven weeks as IT bellwether Infosys kickstarted the corporate earnings season on a weak note. Infosys tumbled almost 5% after the company's Q3 December 2010 earnings lagged market expectations and as its earnings and revenue outlook for Q4 March 2011 disappointed investors. Index heavyweights Reliance Industries (RIL) declined.
The BSE 30-share Sensex was down 351.28 points or 1.8% to 19,182.82, its lowest closing level since 26 November 2011. The index shed 397.83 points at the day's low of 19,136.27 in late trade. The Sensex fell 11.72 points at the day's high of 19,522.38 in early afternoon trade.
The S&P CNX Nifty was down 111.35 points or 1.9% at 5,751.90, its lowest closing since 9 September 2010.
The BSE Mid-Cap index fell 0.8% and the BSE Small-Cap index fell 0.65%. Both these indices outperformed the Sensex.
Except the BSE Realty index, all the other sectoral indices on BSE declined. Banking sector index Bankex (down 3.53%), IT index (down 3.41%), and Consumer Durables index (down 2.7%), underperformed the Sensex. The BSE Metal index (down 1.23%), Oil & Gas index (down 1.1%), PSU index (down 1.01%), Healthcare index (down 0.7%), Capital Goods index (down 0.62%), Power index (down 0.54%), Auto index (down 0.3%), FMCG index (down 0.27%) and Realty index (up 0.54%), outperformed the Sensex.
The BSE clocked turnover of Rs 3554 crore, lower than Rs 3992.25 crore on Wednesday, 12 November 2011.
The market breadth, was weak.The breadth was strong earlier in the day. On BSE, 1756 shares declined while 1122 shares advanced and a total of 101 shares remained unchanged. Among 30 Sensex shares, 25 fell and rest rose.
Intraday volatility was high. NSE's volatility index, India VIX, edged up to 23.15% from Wednesday's (12 January 2011) close of 21.41%.
The Government will announce inflation data for the month of December 2010 on Friday, 14 January 2011. A Capital Market poll of economists expects inflation based on wholesale prices to rise to 8.42% in December 2010 from 12-month low of 7.48% in November 2010. High food prices have reinforced expectations for interest rate hike by the central bank at a policy review on 25 January 2011. As per a poll by Capital Market, economists widely expect 25 basis points increase each in repo rate and reverse repo rate at January policy review.
VIEWS FROM DIFFERENT BROKING HOUSES:
FAIRWEALTH SECURITIES:
“Indian market again faced heavy selling pressure due to weak domestic cues, Banking and IT stocks had major loses. Realty sector managed to close in green. The Sensex closed at 19,182, down 351 points from its previous close, and Nifty closed at 5,751, down 111 points”.
“In the next session, Nifty is expected to trade with high probability of breaching of 5,690 important support level. In that case it may test 5,555. Traders are suggested to avoid long positions below 5,690 Nifty Spot. Banking would participate in either side rally. Telecom and fertilizer may appear comparatively stronger”.
BONANZA PORTFOLIOS:
“Nifty showed selling pressure from resistance near 5,850 levels and closed in red. Nifty`s short term trend is down and Nifty is trading near its crucial support 5,750-5,690. If Nifty respect support then some recovery may be seen else selling pressure till 5,500 may also be seen in next few trading days”.
“For daily purpose, the trend deciding level is at 5,750. If Nifty shows strength above 5,750 levels, then rally to 5,790/5,820/5,875 levels may be seen. If Nifty does not show strength above 5,750 levels then selling pressure till 5,690/5,625/5,550 levels may also be seen”.
CALLS FROM DIFFERENT BROKING HOUSES:
SKP SECURITIES:
Sell PNB Below 1125 target 1109 stoploss 1135 (1 Day)
Buy ABGSHIPYARD @375 target 399 stoploss 361 (1-7 Days)
Buy SESAGOA @327 target 345 stoploss 316.50 (1-7 Days)
Buy INDIAN HOTELS @96.80 target 106 stoploss 92 (1-7 Days)
Buy RANBAXY @563 target 630 stoploss 525 (1-30 Days)
Buy BIOCON @402 target 476 stoploss 365 (1-45 Days)
FAIRWEALTH SECURITIES:
Sell DLF below Rs 261 for target of Rs 256-253 and stop loss of above Rs 266
Buy Great Eastern Shipping Company above Rs 331 for target of Rs 342-347 and stop loss of below Rs 325
Sell Hindustan Zinc futures below Rs 1,360 for target of Rs 1,340-1,310 and stop loss of above Rs 1,380
Sell BHEL futures below Rs 2,215 for target of Rs 2,190-2,165-2,115 and stop loss of above Rs 2,240
Sell Tata Steel futures below Rs 633 for target of Rs 626-616 and stop loss of above Rs 640
Sell UltraTech Cement futures below Rs 1,018 for target of Rs 1,005-984 and stop loss of above Rs 1,030
Sell Nifty Futures below 5,690 for target of 5,660-5,620 and stop loss of above 5,720
Sell Bank Nifty Futures around 10,890-10,910 for target of 10,800-10,735 and stop loss of below 10,960
FOR TODAY: WILL NIFTY PAUSE AGAIN AFTER YESTERDAY'S BLOODBATH? SGX NIFTY IS TRADING AROUND 5760 DOWN 4 POINTS. TODAY'S INFLATION DATA MAY AFFECT MARKET SENTIMENT. BETTER WAIT AND WATCH...........RISKY TRADER MAY INITIATE LONG NIFTY FUTURE ABOVE 5750 (NIFTY SPOT) AND MAY AVERAGE AROUND 5700 (SPOT) BUT WITH STRICT STOPLOSS WITH 5690. REMEMBER WITH STRICT STOPLOSS 5690.
NOTE: ON SATURDAY/SUNDAY, WILL POST RAILWAY BUDGET PICKS
