Index Trends and Stocks In Action for 28th December 2012

Market slipped below 5900 levels and closed at 5870 down by 35 points. Bulls are not able to sustain above 5900 levels. Again nifty is slipping into range where the lower range stands at 5820 and higher point stands at 5935. Going ahead on downside first support for nifty stands at 5820 and second support stands at 5775 and on higher side resistance for nifty stands 5940-5975.

Kalpataru Power Transmission (KPTL) has secured new orders worth over Rs 955 crore. Of the orders are Rs 405 crore from Power Grid Corporation, Rs 140 crore from Armenia and Rs 65 crore from Philippines. It is trying to increase its footprint in the international market and has been successful at entering two new countries, Armenia and Uganda. The stock price of KPTL is likely to see upward movement today.

The proposal to set up a steel plant jointly by the state owned NMDC and Russia's Severstal is facing hurdles as both the companies are not willing to lose management control of the JV, according to Business Standard. Differences between the two parties have come up as a result of gaining majority control over the venture. Among other issues faced by the JV is the mining ban in Karnataka. Until the ban is lifted and captive mine is allotted to the JV, the issue will not be taken up. NMDC is not willing to give its iron ore mines for the JV. This is likely to result in a negative bias in the movement of NMDC today.

It has been reported that diesel prices may be raised by Rs 10 per litre over a 10 month period and kerosene rates to a similar extent over a two year period if the proposal is accepted by the Oil Ministry. This is likely to result in pressure on automobile stocks. Stocks prices of Tata Motors and Ashok Leyland among others are likely to see downward movement. At the same time, stock price of Oil Marketing Companies like HPCL and BPCL are likely to react positively.

US based drug maker Bristrol- Myers has filed a patent infringement case against Dr Reddy's Laboratories (DRL) over the drug lxempra, used in the treatment of metastatic or locally advanced breast cancer patients. The market for the drug is USD 120 million. Although an infringement patent has been filed, the negative impact on the company’s operations seems less. On the back of this, the stock price of DRL may see slight negative movement today.

Bharti Infratel is set to get its shares listed on the BSE and NSE today. Contrary to the response received for the listings of CARE and PC Jeweller, investors seem sceptical about this listing. High amount of volatility is expected to emerge in the stock price of Bharti Infratel as it would be the first day of the listing. Investors can keep a close on the directional trend in this stock to benefit from pricing movement.