Index Trends & Stocks In Action For 18th March 2013

The Indian markets witnessed a sharp sell off on Friday with the Nifty drifting below the important level of 5900, closing lower by 0.62% at 5873. The nifty has failed to cross its major hurdle of 5975-5980 on three attempts. This suggests the market is facing intense selling pressure around these levels. Going ahead if the index has to move further up, it needs to close above levels of 5975-5980. On an intraday basis, we feel the Nifty has crucial support at 5820 and immediate resistance around levels of 5930.

Jindal Steel and Power plans to augment its steel making capacity at its Raigarh plant by 7 million tonnes per annum (mtpa) from the current 3 mtpa. This capacity expansion is to be carried out in two phases at an estimated cost of Rs 24000 crore. The first phase has an outlay of Rs 15000 crore for 4 mtpa expansion and the second of Rs 9000 crore for 3 mtpa. The first phase is expected to be completed within three years after the commencement of work. The stock prices of Jindal Steel and Power are expected to see some strength today.

Info Edge said in a filing that it would be writing off its investments in e-commerce player Ninety Nine Labels during the current quarter. Ninety Nine Labels operates through 99labels.com and 9rasa.com. Although Ninety Nine labels has said that this would not affect business and that they would break-even this year, fact remains that Info Edge is writing its entire investment off. This is likely to result in volatility in the stock prices of Info Edge today.

Infosys announced that it has won an order for India Post’s rural systems integration. As part of this contract, Infosys would develop a service delivery platform that will allow more than 130000 rural post offices to offer online services. This is the second order Infosys has won from India Post and it is likely to result in upward movement in the stock prices today.

In an attempt to divest from non-core assets, Ashok Leyland sold shares in IndusInd Bank worth Rs 216.25 crore. The divestment would help reduce its debt which is at levels around Rs 3500 crore. The company plans more divestment to bring down overall debt levels. This would result in some upward movement in the stock prices of Ashok Leyland.