Index trend and stocks in action January 14, 2016

The Indian markets opened on a positive note, following in the footsteps of a positive trend in the Asian markets. But after trading in the positive territory for the first hour of trade, the indices witnessed a sudden bout of selling which resulted in a breach of crucial level of 7500. However, buying in the index marked a smart turnaround led by buying in index heavyweights like Reliance and Infosys. On the daily chart the index has formed a long legged doji candlestick pattern, which is suggesting strong buying at lower levels. The appearance of a long legged doji in a downtrend provides hints that the market may be reversing to the upside. As long as the low of 7425 is intact, chances are that we have registered a short term bottom. Now going forward index needs to sustain above levels of 7615 for further up-move, upto levels of 7660-7725. On the downside first support is around levels of 7480 and next major support is around 7425. The daily 14-day RSI continues with positive divergence, and this suggests that momentum is in favour of the bulls.

SBI: PSU Bank SBI has informed that it has secured a $500 million loan from Korean EXIM Bank to help fund companies from the East Asian nations for setting up units in India.

Tata Steel: Rating agency Standard & Poor’s has downgraded Tata Steel long-term corporate credit rating by a notch to ‘BB-‘ from ‘BB’, citing weak financial performance and high debt leverage; and expects stress on cash flow for the steelmaker in the next 12 to 18 months.

AstraZeneca pharma: British drug maker AstraZeneca is betting big on Asia including emerging markets such as India where it plans to introduce innovative products in its focus areas of cancer, lung diseases and diabetes, rather than depend on generic drugs.

Mindtree: Mindtree will be in action, as the company’s board will consider issuing bonus shares, the company said in a filing to exchanges. Earlier the company has awarded shareholders with a 1:1 bonus issue in the month of June, 2014.

Infosys: IT bellwether Infosys will be in fame as company is set to announce its quarterly results today. The stock had witnessed good buying ahead of its results in a dull market and has helped indices to hold firm.

Aditya Birla Nuvo: The Birla Group Company will be delisted from BSE indices effective 20th January, following a demerger of its fashion retail business into Pantaloons Fashion and Retail.