Index Trends And Stocks In Action For June 23, 2014

Indian Equity market ended with losses for the third consecutive trading session. Prolonged selling pressure in the Healthcare, Auto, Power and the Capital Goods stocks dragged the Nifty below 7500 on intraday tick. However it was for short while as Nifty just managed to close above 7500 mark. Looking at daily charts of index it looks poised for a bounce back as the bear’s are unable to push below the strong support level of 7470, which is working pretty well. 

On weekly chart index has formed an inverted hammer pattern this pattern is a bullish pattern. RSI is trading near important support levels of 60. So next couple of session would be interesting to see whether the index bounce back and resume its uptrend or it slip below its important support level and creates panic on d-street. For day trading resistance is around levels of 7590-7610. On downside important support is 7470.

The Kolkata-based United Bank of India (BSE Code: 533171) has a modest capital adequacy ratio of 9.8% against the bare minimum of 9% and thus it to needs bring in capital to improve the critical ratio. UBI plans to raise up to Rs 1000 crore either by second public issue or rights issue of shares or by placement of shares to qualified institutional investors. It may also raise up to Rs 300 crore of fresh equity from Life Insurance Corporation of India and another Rs 275 crore from the government by converting existing perpetual non cumulative preference shares (PNCPS).  The stock may remain in focus in today’s trade.

Global independent consultant Gaffney, Cline & Associates (GCA) is likely to be appointed to verify state-owned ONGC's (BSE Code: 500312) claims that gas from its Krishna Godavari fields may have flowed out of the neighbouring KG-D6 wells of Reliance Industries (BSE Code: 500325) and ONGC have shortlisted DeGolyer and MacNaughton (D&M) and GCA to decide if four wells drilled on the boundary of the KG-D6 block were drawing gas from the neighbouring discoveries of the state-owned firm. The stock may trade won a volatile note in today’s trade.

State-owned UCO Bank (BSE Code: 532505) has sought capital support worth Rs 1,000 crore from the government for the current fiscal to meet its growth plans. Last fiscal, the Kolkata-based bank got capital support worth Rs 200 crore from the government. Asked if the bank would tap capital markets to raise funds besides the government's capital infusion programme, the management said that the bank is keeping all options open and would take a call at the appropriate time. The stock may remain in limelight in today’s trade.

Domestic paint major Asian Paints (BSE Code: 500820) is evaluating opportunities to increase its presence in the international markets. The company's wholly-owned subsidiary in Mauritius, Asian Paints (International) (APIL), had in April signed an agreement with shareholders of Kadisco Chemical Industry PLC., Ethiopia, to acquire either directly or through its subsidiaries 51% of its share capital. The stock may trade with a positive bias in today’s trade.