Index Trends and Stocks In Action For December 11, 2013

Indian Equity market fell about half a percent on profit booking after a breathtaking rally in previous three consecutive sessions. Banking stocks and Capital goods dragged market down whereas IT stocks were dark horse today, IT index ended up by 2%. In our last write up we mentioned about RSI showing negative divergence and we mentioned the momentum is likely to diminish and we may see a correction or consolidation, so this was in line with our expectation. Now going forward if we look at daily charts market made a gap post assembly election results and this gap was filled today. Now from here there are two scenario which are likely in coming session first on is we break important support of 6280 on Nifty and touch level of 6220 and second one is post filling gap we consolidate for a day or two and resume uptrend. In short term the range is specified between 6220-6415. For intraday important support for Nifty is 6280 if Nifty breaks this level next important support is 6220. On upside 6375 will act as resistance and next resistance is around 6415.

France's Dassault Aviation and Reliance Industries are planning to set up a facility to produce wings of Rafale combat aircraft selected by IAF for meeting its requirement of 126 fighter planes. The two firms are planning to set up a Rs 1000-crore facility for producing the wings of the Rafale combat aircraft and it is most likely to come up in Bangalore. Under the plan, Dassault Aviation would help Reliance to establish the factory similar to its production facilities in France where the aircraft is produced. The stock may remain in focus in today's trade.

Aiming to increase its turnover from Rs 3200 crore in 2012-13 to Rs 5000 crore next fiscal, Bajaj Electricals plans to double its exports to Rs 100 crore as well. The leading consumer durables and lighting company, which is celebrating its 75th year in 2013-14, would also increase the number of countries it exports to from 33 now to 50. The stock may remain in focus in today's trade and may trade with a positive bias.

Bharti Airtel and Reliance Jio Infocomm have announced a telecom infrastructure sharing arrangement under which they will share infrastructure created by both parties. This will include optic fibre network- inter and intra city, submarine cable networks, towers and internet broadband services and other such opportunities identified in the future. The cooperation is aimed at avoiding duplication of infrastructure, wherever possible, and to preserve capital and the environment. Bharti Airtel may remain in limelight in today's trade and may witness some buying interest.

Reliance Communications is considering a bond issue to the tune of USD 1 billion. The firm is said to have appointed bankers to finalize the issue and has short-listed European and Singapore markets as potential markets. The issue, which is targeting fund-raising at the cost of debt of around 8%-9%. Proceeds from the issue would likely go towards retiring and restructuring the company's existing high-cost debt. The counter may witness some buying interest in today's trade.

Competition Commission has slapped a fine of Rs 1773.05 crore on Coal India  for allegedly abusing dominant position in supply of the dry fuel - its first major penalty on a state-owned company. Competition Commission of India (CCI) has found Coal India is operating independently of market forces and enjoys an undisputed dominance the market for production and supply of non-coking coal in the country. The stock may witness some selling pressure owing to this development.