Index trend and stocks in action February 18, 2016

The Indian markets opened on a positive note and soon after opening entered into the negative zone. However, the intraday correction was used by traders to initiate a long position and in the last hour of trading, indices staged a spectacular rally. On the daily chart the index after forming a Bearish Engulfing candlestick pattern as on 16th February, followed up with a hammer candlestick pattern as on 17th February, and now the bearish engulfing candlestick pattern is negated. The index has also managed to fill the gap which was formed on 15th February. Now going forward the index has resistance in the zone of 7150-7170. If it manages to sustain above the zone of 7150-7170, it will open for levels of 7240 on the upside. On the downside, the index has support around levels of 7040. If this support level is breached it’s likely to re-test lower levels of 6950.

Dr Reddy’s Laboratories: Hyderabad based drug maker Dr Reddy’s Labs has approved a share buyback to the tune of Rs 1569 crore. Dr Reddy will buy back 44.85 lakh shares accounting for 2.6 per cent of the current paid up capital at a price not exceeding Rs 3500. This buyback is subject to the approval of the shareholders by way of a special resolution through a postal ballot.

Vedanta: The Company’s performance is expected to remain weak for the next 12-15 months on account of lower commodity prices and high debt, hence, Standard & Poor’s (S&P) downgraded its long term credit rating for Vedanta.

PNB: The PSU lender Punjab National Bank as part of its balance sheet clean up exercise plans to sell up to Rs 3000 crore bad loans to asset reconstruction companies (ARCs) in the fourth quarter.

Britannia: Britannia Industries is in advanced talks with various Special Economic Zones (SEZs) authorities in Gujarat to buy land for a new factory that will cater only to its overseas customers.

ICICI Bank: One of India’s biggest private sector banks plans to lend more to retail customers and go slow and be more cautious with corporate loans. Bank is also making an effort to decrease so called ‘Concentration risk’ or lending too much to one company or business group.

Quick Heal Technologies: IT Security solutions provider Quick Heal Technologies will make its debut on the exchanges today.

Jet Airways: The country’s largest airline by passengers carried Jet airways has received an investment grade rating of BBB- from the credit rating agency ICRA, an affiliate of Moody’s Investors Service.