ALL MOST ALL THE STOCKS ALONG WITH THE KEY INDICES PLUNGED TO HIT FRESH DAY'S LOW IN LATE TRADE. VOLATILITY RULED THE ROOST AS TRADERS ROLLED POSITIONS IN THE DERIVATIVES SEGMENT FROM OCTOBER TO NOVEMBER. NIFTY FELL BELOW THE PSYCHOLOGICAL 5,000 MARK AFTER REGAINING THAT LEVEL IN EARLY AFTERNOON TRADE. THE MARKET BREADTH WAS WEAK. BANKING, METAL, REALTY AND CONSTRUCTION STOCKS FELL. INTRADAY VOLATILITY WAS HIGH AHEAD OF THE EXPIRY OF THE NEAR TERM CONTRACTS THIS WEEK. FIRM ASIAN STOCKS HELPED THE MARKET BRIEFLY HIT POSITIVE ZONE IN EARLY TRADE AFTER AN INITIAL SLIDE. VOLATILITY CONTINUED LATER. THE MARKET MOVED INTO POSITIVE ZONE FROM NEGATIVE ZONE IN EARLY AFTERNOON TRADE. THE RBI PUMPED IN MASSIVE LIQUIDITY IN THE BANKING SYSTEM IN THE PAST ONE YEAR OR SO TO HELP REVIVE THE DOMESTIC ECONOMY IN THE AFTERMATH OF THE GLOBAL FINANCIAL CRISIS. WHILE AS EXIT FROM THE LOOSE MONETARY POLICY IS IMMINENT, SPECULATION ON THE BOURSES IS THE TIMING OF THE EXIT POLICY. THE RBI IS EXPECTED TO KEEP ITS BENCHMARK LENDING AND BORROWING RATES ON HOLD AT A QUARTERLY MONETARY POLICY REVIEW ON TUESDAY, 27 OCTOBER 2009. A SECTION OF MARKET, HOWEVER, EXPECTS THE RBI TO RAISE THE CASH RESERVE RATIO (CRR), THE PROPORTION OF DEPOSITS THAT BANKS KEEP WITH THE CENTRAL BANK, TO TAME INFLATIONARY PRESSURES IN THE ECONOMY. A POSSIBILITY OF A HIKE IN THE STATUTORY LIQUIDITY RATIO (SRL) CANNOT BE RULED OUT EITHER. IN NOVEMBER 2008, THE RBI HAD REDUCED THE SLR BY ONE PERCENTAGE POINT TO 24% - ITS FIRST MOVE IN 11 YEARS - AS PART OF ITS MEASURES TO BOOST LIQUIDITY TO CUSHION THE IMPACT OF THE GLOBAL CREDIT CRISIS AFTER LEHMAN BROTHER'S COLLAPSE. SLR IS THE MINIMUM SHARE OF BANK DEPOSITS TO BE HELD IN APPROVED GOVERNMENT SECURITIES. BANK STOCKS FELL AFTER COMMENTS FROM A FINANCE MINISTRY OFFICIAL ON FRIDAY, 23 OCTOBER 2009, DASHED HOPES FOR THE CENTRAL BANK RELAXING MARK-TO-MARKET RULES FOR BANK'S DEBT HOLDINGS. THE MARKET HAS BEEN AGOG WITH TALKS OF THE CENTRAL BANK HIKING THE CEILING ON THE PORTION OF GOVERNMENT SECURITIES THAT BANKS CAN PARK IN HELD-TO-MATURITY (HTM) CATEGORY, POSSIBLY AT THE QUARTERLY MONETARY POLICY REVIEW ON 27 OCTOBER 2009.
TODAY MARKET WILL BE HIGHLY RANGE BOUND AHEAD OF EXPIRY, IN THE LAST SESSION WE HAVE WITNESSED A DEEP SELL OFF IN THE LAST HALF AN HOUR OF TRADE MAKING THE BREADTH OF THE MARKET WEAK. STRUCTURALLY OUR MARKETS HAVE WEAKENED EVEN POSITIVE IMPACT OF GLOBAL CUES MAY NOT HOLD OUR MARKETS MUCH, SO ONE IS ADVISED TO STAY OUT OF LONGS AND DON’T INITIATE LONGS ANY MORE AT THIS STAGE TILL IT IS ADVISED. IF NIFTY TRADES BELOW 4978 WE CAN SEE NIFTY TO COME DOWN TO 4949 AND BREAK BELOW THIS LEVEL WOULD TAKE NIFTY TO 4919 WHICH IS VERY CRUCIAL, ONE IS ADVISED TO STAY CAUTIOUS. ON THE UPSIDE IF NIFTY CROSSES 5016 ONLY THEN ONE CAN SEE IT TO GO UP TO 5044. STOCKS LOOKING WEAK PTC, MLL, KSOILS, GSPL, GTLINFRA, IBREAL, SINTEX, UCOBANK, RPOWER, ISPAT, FSL, DLF, UNITECH, ROLTA, RNRL AND ABAN. STOCKS ON POSITIVE SIDE HEROHONDA, EDUCOMP, WELGUJ, PANTALOON, AUROPHARMA, RANBAXY AND CIPLA.
TODAY MARKET WILL BE HIGHLY RANGE BOUND AHEAD OF EXPIRY, IN THE LAST SESSION WE HAVE WITNESSED A DEEP SELL OFF IN THE LAST HALF AN HOUR OF TRADE MAKING THE BREADTH OF THE MARKET WEAK. STRUCTURALLY OUR MARKETS HAVE WEAKENED EVEN POSITIVE IMPACT OF GLOBAL CUES MAY NOT HOLD OUR MARKETS MUCH, SO ONE IS ADVISED TO STAY OUT OF LONGS AND DON’T INITIATE LONGS ANY MORE AT THIS STAGE TILL IT IS ADVISED. IF NIFTY TRADES BELOW 4978 WE CAN SEE NIFTY TO COME DOWN TO 4949 AND BREAK BELOW THIS LEVEL WOULD TAKE NIFTY TO 4919 WHICH IS VERY CRUCIAL, ONE IS ADVISED TO STAY CAUTIOUS. ON THE UPSIDE IF NIFTY CROSSES 5016 ONLY THEN ONE CAN SEE IT TO GO UP TO 5044. STOCKS LOOKING WEAK PTC, MLL, KSOILS, GSPL, GTLINFRA, IBREAL, SINTEX, UCOBANK, RPOWER, ISPAT, FSL, DLF, UNITECH, ROLTA, RNRL AND ABAN. STOCKS ON POSITIVE SIDE HEROHONDA, EDUCOMP, WELGUJ, PANTALOON, AUROPHARMA, RANBAXY AND CIPLA.
BUY HEROHONDA SL 1587 TGT 1624/1645/1663
BUY WELGUJ SL 281 TGT 289/294
BUY PANTALOON ABOVE 331 SL 330 TGT 336/339
BUY AUROPHARMA SL 834 TGT 860/869/875
SELL DLF SL 437 TGT 414
SELL AXIS BANK SL 981 TGT 958/952/945
SELL JINDALSAW BELOW 780 SL 794 TGT 767/735
Note: buy calls one should buy only on the positive zone
BUY WELGUJ SL 281 TGT 289/294
BUY PANTALOON ABOVE 331 SL 330 TGT 336/339
BUY AUROPHARMA SL 834 TGT 860/869/875
SELL DLF SL 437 TGT 414
SELL AXIS BANK SL 981 TGT 958/952/945
SELL JINDALSAW BELOW 780 SL 794 TGT 767/735
Note: buy calls one should buy only on the positive zone
