1:30 pm: Indices have made a good comeback in the last half
an hour with the Sensex now up 79 points at 28417 and the Nifty up 22 points at
8484. Market breadth too has improved with gainers outpacing losers
nearly 2:1 on the NSE.
Second line shares continue to fare better than their large cap counterparts
with Gujarat Gas(+ 15 percent) and Oberoi Realty (+8%) being among the key
gainers.
Brokers say every rise in indices is likely to be met with profit taking as
the market does not have enough triggers to sustain the uptrend.
Kotak Securities has rated Oberoi Realty as one of its top picks in the real
estate space.
"Even though debt has increased, Oberoi’s balance sheet still remains
strong with additional leveraging capacity to eventually raise monies for
business development," the brokerage said in a note to clients.
In sectoral trends, realty, metal and FMCG shares are among the best
performers, while IT shares have been under pressure right through the day.
Sanjeev Prasad of Kotak Institutional Equities feels the FMCG and pharma
spaces may appear expensive, but a de-rating was unlikely as these stocks would
be a good hedge in the event of the much anticipated economic reforms not
coming through. He is bullish on stocks like Marico, Dabur and Britannia.
"Valuations have become pretty expensive across the board if you look
at any consumer staple company or pharmaceutical company but I am willing to
make a call that you may not see that kind of de-rating even if you see a big
slowdown in terms of economic reforms momentum, etc. Valuations probably will
hold up more in anticipation of the kind of medium-term growth as far as some
of these sectors are concerned," he said in an interview to CNBC-TV18 this
morning.
1:00 pm: The consolidation in Indian equities continued in
afternoon trade Wednesday, with outperformance in metals and oil & gas
offset by weakness IT and pharma. The broader market, however, bucked the
trend.
At the time of this writing, the Sensex and the Nifty were down 33 points
and 11 points (0.13 percent each) to 28,306 and 8,451. The BSE midcap index
rose 0.56 percent while the smallcap index was up as much as 0.9 percent.
GAIL, Cipla and ITC were the biggest gainers in the Sensex rising 1.5
percent to 3 percent while Bharti Airtel and Bajaj Auto were down 1.7 percent
each.
The latter two were down after Nigeria, a key African market for both,
devalued its currency by 8 percent today.
Power and gas shares rose after a CNBC-TV18 report said the government would
today chalk out plans for gas pooling, a move in which power plants that have
gas suppliers far away could enter into swap arrangement with a nearby
supplier, saving transportation costs and potentially helping idle power plants
with 28,000 megawatts capacity that are currently starving for fuel.
JSW Energy surged 6.6 percent, Petronet LNG climbed 4.1 percent while
Torrent Power was up 8.1 percent.
Jet Airways was up 2 percent after industry official met the civil aviation
minister yesterday to discuss several issues related to the industry such as
the 5/20 rule, high airport charges, etc.
State-run HMT jumped 6.1 percent amid reports the government was planning a
rescue package for the loss-making company.
Financial Technologies appreciated 5.9 percent after it agreed to sell stake
in MCX-SX to Rakesh Jhunjhunwala among other investors.
While ITC clmbed 1.8 percent, a day after falling 5 percent, after
brokerages expressed the view that the announcement yesterday -- that the
government may decide to ban sale of loose cigarettes – was unlikely to come
through.
A number of shares, including Asian Paints, Castrol, Container Corp and
Gujarat State Petronet, have hit 52-week highs in trade today.
While Elder Pharma, Era Infra, Gujarat NRE Coke and Omaxe hit 52-week lows.
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