Index Trends & Stocks In Action For 28th June 2013

The Indian equity markets ended the June series nearly 2% higher on Thursday amid firm global cues and after lower-than-expected current account deficit eased worries about deficit funding. The strengthening rupee also boosted market sentiment. The Nifty closed higher by 93 points at 5682.

Yesterday we mentioned the Nifty is forming a good base at levels of around 5560-5579 and is ready for a good pull-back. What we witnessed was in line with our expectations. As of now, we expect the markets to continue its momentum upwards.

Going forward, bulls will face a hurdle at levels of around 5720 and if we sustain above the level, the next major hurdle will come in at 5750. On the other hand, support is placed at levels of 5660-5630.

The rush for the banking license seems to be only increasing. After a long list of companies that have announced their plans to apply for a banking license, Bajaj Finserv has also said that it has submitted its application to the Reserve Bank of India on June 26, 2013. It has proposed to convert its subsidiary Bajaj Finance into a bank in terms of RBI Guidelines for Licensing of New Banks. The stock is likely to see positive trades today.

Also trying its luck for the much-awaited banking licence is India Infoline, which said it will submit its application with the RBI. India Infoilne has informed that the Board of Directors, at its meeting, approved the proposal for making a new banking licence application to RBI under Guidelines for licensing of new banks in private sector. Stock prices of India Infoline are likely to see some upward movement.

Airlines have cut fares by as much as 15% on some routes hoping to boost passenger traffic in the traditionally lean June-September monsoon season. Low-fare airlines IndiGo, SpiceJet and GoAir have cut their fares on the Delhi-Mumbai route from Rs.9,300 to Rs.7,900 on tickets booked up to five days in advance. Stock prices of SpiceJet are likely to see some volatility today.

Ullas Kamath, Joint Managing Director of Jyothy Laboratories has said that the company is aiming to achieve 20-25% sales growth in FY14 and is also targeting EBIDTA margin of 14-15 percent. Its FY13 margins stood at 11.7%. Kamath is very positive to achieve improvement in the EBITDA margins on the back of new strategies. The market possibly will show thumbs up to this news.