GOOD MORNING!!!
ALL THE KEY INDICES REMAINED WEAK AFTER THE RESERVE BANK OF INDIA DID AWAY WITH SOME SPECIAL LIQUIDITY STEPS THAT IT HAD ANNOUNCED IN THE AFTERMATH OF THE GLOBAL FINANCIAL CRISIS. THE RBI HAD 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. BANKING STOCKS FELL AS THE RBI DID NOT RELAX 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). RATE SENSITIVE REALTY STOCKS FELL. METAL STOCKS ALSO DECLINED. INDEX HEAVYWEIGHT RELIANCE INDUSTRIES, TOO, EDGED LOWER. THE RESERVE BANK KEPT ITS BENCHMARK LENDING AND BORROWING RATES ON HOLD AT A QUARTERLY MONETARY POLICY REVIEW ON TUESDAY, 27 OCTOBER 2009. IT ALSO KEPT STEADY CASH RESERVE RATIO AT 5% BUT RAISED THE STATUTORY LIQUIDITY RATIO TO 25% FROM 24% WITH EFFECT FROM 7 NOVEMBER 2009. THE CENTRAL BANK SAID AN ACCOMMODATIVE MONETARY POLICY STANCE IS REQUIRED AS THE ONGOING ECONOMIC RECOVERY WAS "FRAGILE" THE RBI KEPT 2009/10 GDP FORECAST AT 6% WITH UPSIDE BIAS AND SAID IT SEES MODEST DECLINE IN AGRICULTURE. THE RBI RAISED PROJECTION OF INFLATION TO 6.5% WITH AN UPSIDE BIAS AT END MARCH 2010 FROM EARLIER 5%. THE RBI SAID BANK CREDIT REMAINED SLUGGISH AND IT CUT ITS FORECAST FOR ADJUSTED NON-FOOD CREDIT GROWTH IN 2009/10 TO 18% FROM 20%. "BANKS ARE URGED ONCE AGAIN TO STEP UP THEIR EFFORTS TOWARDS CREDIT EXPANSION WHILE PRESERVING CREDIT QUALITY WHICH IS CRITICAL FOR REVIVAL OF GROWTH," IT SAID. VOLATILITY MAY REMAIN HIGH ON THE BOURSES THIS WEEK AS TRADERS ROLLOVER POSITIONS IN THE DERIVATIVES SEGMENT FROM OCTOBER 2009 SERIES TO NOVEMBER 2009 SERIES AHEAD OF THE EXPIRY ON THURSDAY, 29 OCTOBER 2009.
TODAY MARKET WOULD OPEN WEAK AND REMAIN HIGHLY VOLATILE AND THE TREND WOULD REMAIN NEGATIVE AND CRUCIAL SUPPORT SEEN FOR NIFTY IS 4797 AND BREAK BELOW THIS LEVEL WE WILL HEAD TOWARDS 4740 WHICH IS ANOTHER MOST IMPORTANT SUPPORT. ON THE POSITIVE SIDE ONE IS ADVICED TO STAY AWAY FROM LONGS AT THIS STAGE NO UPMOVE ON BULLISH SIDE SO INVESTORS ARE ADVISED TO EXIT THEIR POSTIONS TO THE MAXIMUM AND TRADERS ARE ADVISED TO TRADE SHORT TO THE MAXIMUM AND ONLY THE RECOMMENDED SCRIPS CAN BE TRADED LONG ONLY WITH STOPLOSSES AND WITH VERY LOW VOLUMES ON THE BUY SIDE, WE CAN SEE MUCH MORE DOWNSIDE AS THE VOLUMES ON THE SELLING ZONE ARE MUCH HIGHER, ALL ARE ADVISED TO STAY CAUTIOUS SMALL UPMOVE MAY PUT YOU IN PANIC AVOID LONGS TILL IT IS ADVISED.
BUY MCLEOD RUSSEL SL 199 TGT 209/214
BUY IDFC SL 142 TGT 154/157
BUY IDFC SL 142 TGT 154/157
BUY FORTIS HEALTHCARE LTD SL 89 TGT 114*
SELL JINDAL STEEL BELOW 670 SL 688 TGT 657/639/607
SELL LICHSGFIN SL 815 TGT 780
SELL JINDALSAW SL 740 TGT 710/693
