Index Trends & Stocks In Action For 17th April 2013

The Indian markets ended near the day’s high yesterday led by the sectors of Banking, Auto and Capital Goods. Equities rose as a steep drop this week in gold and oil prices will ease concerns of a high current account and fiscal deficit. The Nifty rose 121 points to end at 5689.

In our last write up, We had stated that if the Nifty is able to  sustain above levels of 5600-5630, we will see good upward momentum. Accordingly, the index, after sustaining above 5600-5630, rallied one way and registered a high of 5699. We also mentioned we will witness a good short covering once that level of 5600-5630 is breached.

Going ahead, the Nifty needs to sustain above 5710 for it to head towards levels of around 5730. On the downside, it will be important for the Nifty to sustain 5650-5660. This level will prove out to be a near-term support level for the Nifty.

Shares of Wockhardt have seen a steep fall over the last few sessions. However, analysts have again turned bullish on the stock. The street believes that the concerns over the US FDA's audit of Wockhardt's Waluj unit are overdone and believe that not much detriment is expected from US FDA. On this news one can expect the stock to show some gains today.

According to media reports, Crompton Greaves has been awarded a contract of USD 60 million for the purpose of construction of four high-voltage GIS substations by the Electrical Transmission Project Office of the Ministry of Electricity in Iraq. The company is to design, manufacture, deliver and install the substations and is expected to be complete by August 2014. On this announcement, we expect to see some upward movement in the stock prices of Crompton Greaves for the day.

BHEL is in talks to invest around Rs 1300 crore towards R&D activities during the current fiscal year, which is an increase of 4.1% as compared to the previous year. Last year, the products and services that were developed in-house contributed to Rs 9643 crore of BHEL’s overall turnover. Some upward movement is expected in the stock prices of BHEL today.

Reliance Industries (RIL) announced its Q4FY13 numbers post market hours yesterday. Profits for the giant rose by 32% YoY to Rs 5589 crore, boosted by improvement in GRM (gross refining margin). This happened although there was a decline in revenues by 1.4% to Rs 86618 crore. The revenue decline resulted out of a 39% drop in the oil and gas exploration business. The net operating margin was lower by 8.5% on account of lower production of oil and gas and weaker margins in the petrochemicals business. Stock prices of RIL are expected to be volatile with high volumes today.