Index Trends & Stocks In Action for 28th February 2013

Indian markets on Wednesday rallied after the Economic Survey put back some confidence in investors’ and traders. The Nifty managed to pull back from the support zone of 5740-5750 and closed at 5797. So the obvious question is, whether this correction done yet? Here are the answers. Firstly, If you look at the candlestick for the last two trading sessions, you would find that the Nifty has created a double bottom pattern at levels of 5750. This suggest, that demand exists at support levels.  Secondly, the Nifty has formed a Bullish Harami candlestick pattern, which indicates that the falling trend may be reversing. It signals a good time to enter into a long position if it is followed by a white candlestick in the next trading session. So charts are suggesting we could have a promising day today, but all depends on the Finance Minister. Support for the Nifty stands at 5740 and 5690. Resistance could set in at 5820-5880 levels.

Engineering giant Larsen & Toubro has reported that its construction arm L&T Construction has secured from both within and outside the country new orders worth more than Rs1504 crore. These include orders worth Rs 621 crore for the Water and Effluent Treatment business, Rs 413 crore for its solar business, Rs 265 crore worth of orders in the power transmission and distribution business and Rs 205 crore in the ongoing projects in the civil work space. These developments bode well for the company and could see its stock remain in action today.

According to the media reports, Jindal Steel and Power (JSPL) plans to increase its stake in Australia's Apollo Minerals to 11.70 per cent by acquiring an additional 10 million shares of the firm for about Rs 2.20 crore. JSPL until now holds 9.25 per cent in the iron ore mining Australian Company.  Apollo Minerals on the other hand intends using the proceeds raised from JSPL for extending its mine exploration and development activities. The announcement is likely to help the stock of JSPL remain in focus in today's trading.

Coal India (CIL) has invited bids from bankers and interested parties for being a part of its plans of acquiring assets abroad. This move will help the company finally meet shortages by enhancing its output. CIL has already begun assessing the reserves of its mines in Mozambique and invited bids for taking up drilling at those blocks. The exploration of two coal blocks may take over two years. We expect the scrip to see some volatility during the day following these developments and announcements.

Jubilant Life Sciences has been issued a warning letter for violation of manufacturing norms at its facility in Canada. The issue of the letter is not expected to impact the on-going manufacturing, distribution and sale of products of the company. The company is also taking necessary corrective actions required to address the FDA concerns and resolve this matter. The stock is expected to trade with a downward bias for today following this development.

Mphasis is to announce its December 2012 quarter results today. The scrip is expected to see some volatility depending upon the numbers it posts.