Index Trends And Stocks In Action For 15th July 2013

The Indian equity markets on Friday cheered a strong performance by Infosys, which lifted other information technology services stocks and heavyweights like Reliance and LT. The Nifty 50 index closed above the 6000 mark, marking its highest close in one and half months.

On analysing the daily charts of the Nifty, we see that after a strong consolidation in a narrow range of 100-150 points, we have witnessed a breakout on the upside. It doesn’t look like the breakout or the momentum will soften after a two-day rally. We expect the markets to continue building on its gains. However, a process of consolidation can come as we are now in the overbought zone suggested by RSI.

On the upside, the Nifty has immediate hurdle at the level of 6026-6050. On the downside, support for the Nifty is placed at 5970-5955.

Petrol prices were hiked by a steep Rs 1.55 per litre, the fourth increase in rates in six weeks, as the falling rupee made oil imports costlier. Oil companies raised petrol rates by Rs 1.55 a litre, excluding local sales tax or VAT. Stock prices of HPCL, BPCL and OIL among oil & gas stocks are likely to see volatility.

The Directorate General of Hydrocarbons (DGH) has refused to approve Reliance Industries' USD 3.5 billion plan for developing gas discoveries in block NEC-25, off the Odisha coast, as the company had not done the prescribed tests to confirm the finds. RIL had in March-end submitted a USD 3.5 billion Integrated Field Development Plan for producing 10 million standard cubic meters per day of gas from the discoveries D-32, D-40, D-9 and D-10 in the Block NEC-OSN-97/2 (NEC-25) by mid-2019. Stock prices of RIL are likely to see some downward pressure today.

Tata Steel’s European arm reported a loss of 1.2 billion pounds. At the same time revenues dropped by 14% to 8.7 billion pounds. Stock prices of Tata Steel are likely to see downward movement today.

Lupin said it is aiming at a nearly 3 times growth in its revenues at USD 5 billion by 2018. It would achieve this growth organically and by acquiring companies and brands. Stock prices of Lupin are likely to see some upward movement today.