Index Trends And Stocks In Action For February 07, 2014

Indian Equity markets in today's trading session recorded highest closing of the week assisted by gains in heavyweights like ITC, HUL and HDFC Bank as traders and investor continued to buy select heavyweight after recent sell-off. In our last write up we mentioned that range of 6045-6060 will act as strong barrier for bulls and in today's trading session Nifty made high of 6048 and saw good correction than went on to recoup all the losses in later part of the day. So all this was in line of our expectation. Nifty on daily chart has formed hammer candlestick pattern and when we see the hammer candlestick pattern in a downtrend this is a sign of a potential reversal in the market as the long lower wick represents a period of trading where the sellers were initially in control but the buyers were able to reverse that control and drive prices back up to close near the high of the day, thus the short body at the top of the candle.

The index have managed to hold on to levels of 5910-5950 for past couple of trading session and in the process it has formed higher top higher bottom pattern on last three candlestick and it managed to close above its 200-day EMA. Now going forward as we have said last time as well the index needs to clear 6060-6072 supply zone decisively to confirm that the pullback does have some more strength left to march upward. For day trading most crucial support levels are 6010 and 5960. On higher side major resistance is around 6060 and next resistance is around 6100.

Bharat Electronics (BSE Code: 500049) has signed a memorandum of understanding (MoU) with Textron Systems, a Textron Inc company, for providing Indian security agencies the Textron Systems MicroObserver Unattended Ground Sensor (UGS). The MicroObserver UGS system facilitates covert operations with its ease of use and is ideal for border security, surveillance and critical infrastructure protection missions. The stock may remain in focus in today's trade.

SREI Infrastructure Finance (BSE Code: 523756) posted a 1.45% drop in net profit to Rs 18.91 crore for the quarter ended December 31, 2013, from Rs 19.19 crore in the corresponding period last year. The company, however, reported more than 6% growth in income from operations at Rs 441.64 crore. It provided for bad and doubtful debts and non-performing assets worth Rs. 6.18 crore, as compared with Rs. 3.13 crore during the year-ago period. The stock may witness volatile trade in today's session.

Balmer Lawrie & Company (BSE Code: 523319) that operates one of the biggest travel agencies in the country, has acquired holiday brand Vacation Exotica from Vacation Exotica Destinations along with its employees and business. Balmer Lawrie, said the deal was done by way of sale/transfer of business, did not indicate the value of the purchase, which it said was part of its efforts to expand its value proposition and consolidate its presence in the tourism sector. The stock may remain in limelight in today's session.

Mahindra & Mahindra (BSE Code: 500520) plans to invest Rs 5000 crore over the next three years towards infrastructure upgradation, product development and capacity expansion. The company is also planning to introduce 8-10 new variants and upgrades of its products this year. The stock may trade with a positive bias in today's trade.