Index Trends And Stocks In Action For January 06, 2014

Indian Equity markets opened on weak note on Friday and traded in narrow range till after noon. However some recovery from lower levels was seen as buying in IT majors and short covering in banking stocks lifted the mood of the market and market offset most of the losses and managed to end with marginal loss of 10 points at 6211. On weekly chart Nifty has formed a bearish engulfing pattern usually it’s said the this pattern is established at the end of an uptrend and with market forming multiple tops around levels of 6340-6360 it suggest that the momentum on buying side is diminishing. RSI on daily charts took support around levels of 40 but from past few weeks it has been trading in zone of 40-60, so if RSI crosses this hurdle of 60 that we could see a fresh momentum building on by side. So going forward technical pictures looks bit gloomy and uncertain. Intraday important support for Nifty is around 6160 and next important support is 6115. On upside Nifty will face resistance around levels of 6230-6240, if Nifty manages to close above this zone than Nifty will try to make a move up to levels of 6280-6300.

UK-based pharmaceuticals major GlaxoSmithKline has approached the FIPB to hike stake in its Indian arm Glaxosmithkline Pharmaceuticals (BSE Code: 500660) by buying 24.33% for an estimated Rs 6,400 crore. The proposal will come up before the meeting of the Foreign Investment Promotion Board (FIPB), headed by Economic Affairs Secretary Arvind Mayaram, on January 10. The stock is likely to remain in focus in today’s trade and is likely to trade with a positive bias.

Tata Steel (BSE Code: 500470) is considering an increase in the prices of its products in the January-March (Q4) of the 2014 financial year. The company was mainly looking for an increase in the prices of long steel products as imports have squeezed. In the last 2-3 months, the company had raised prices between Rs 2,000 and Rs 3,000 on an average. The stock is likely to trade with a positive bias in today’s trade.

Sobha Developers’ (BSE Code: 532784) sales bookings fell by 6% in the third quarter ended December 2013 to Rs 502.3 crore due to lower sales volumes because of a slowdown in the real estate market. The Bangalore-based company had achieved sales bookings of Rs 533.4 crore in the year-ago period. In terms of volume, the sales bookings declined by 18% to 0.74 million sq ft during the October-December quarter as against 0.9 million sq ft in the corresponding period of the previous fiscal. The stock may witness some selling pressure in today’s trade.

Reliance Communications (BSE Code: 532712) repaid an overseas debt of Rs 3,100 crore (USD 500 million) on schedule. In a statement issued by the company mentions that with these repayments, RCOM has now fully liquidated the borrowings from 23 foreign banks and financial institutions. On Friday the stock witnessed some buying interest but further upside in today’s trade cannot be ruled out.