Corporate Snippets

±  SAIL in talks with Japanese, Korean companies for value-added steel. (BL)

±  NTPC is planning to step up its negotiated purchase of low-ash Ranigunj coal from Coal India from 2.5mn tons to 5mn tons. (BL)

±  The TDSAT has directed Reliance Communications to pay in a week principal amount and 50% of the interest demanded by the telecom department for access deficit charge for walky service. (BL)

±  Abbott Laboratories has settled a patent litigation case against Ranbaxy, allowing the firm to launch a generic version of the US drugmaker’s cholesterol lowering medicine Tricor. (ET)

±  JSW Steel ropes in SBI, Bank of India to refinance US$2.2bn Ispat debt. (ET)

±  The government plans to infuse Rs9.07bn as equity capital into two PSU lenders Dena Bank and Vijaya Bank as part of recapitalisation package to shore up equity capital. (BL)

±  HDFC has no plans to raise its stake in private lender Ratnakar Bank. (BS)

±  ONGC expects to increase its daily gas production by 2mn standard cubic meters and 9,400 barrels of associated oil per day initially from KG—Basin once the two offshore blocks — G1 and GS—15 starts production from May. (BL)

±  Hindustan Copper may sell 20% in 2 mines to Nalco. (ET)

±  Andhra Bank plans to raise Rs6.18bn by way of allotting preferential shares to the Government of India. (BL)

±  Finance, Steel Ministries differ over SAIL FPO. (BS)

Pre Market Ideas

morning call,

BUY and HOLD

ICICIBANK at 1028

sl 1020

TARGET 1137,1141

सेन्सेक्स (18211.52) -295.30 अंक गिरकर, नीफ़्टी (5458.95) -87.50 अंक गिरकर, बंद.

Buy and Hold....

Buy LIC Housing finance (below 200.50) with s/L 191 tgt 205, 214.90++

Nifty – Long Calendar Straddle

Sell Nifty Feb 5500 CE and 5500 PE at 120 and Buy Nifty March 5500 CE and 5500 PE at 320. Net premium out flow is around 200. This is an excellent strategy for around 14 days and can yield around 200 points premium in profit. So this gives a Risk Reward of around 1:1. The break even is at 5300 and 5700, however the B.E.P is calculate just adding the premium. This is an excellent strategy as the time decay is adjusted against the selling of Feb 5500 Options and the swings in Nifty will be captured by the Long 5500 March options.

Market Commentary ..

A steep drop in food inflation helped the Indian market stretch the ongoing recovery to five straight trading sessions. The Nifty surpassed 5500 and closed well above it. A move past 5500 has triggered hopes of a move towards 5690. It remains to be seen if the Nifty is able to keep its head above 5500.

Volumes and turnover improved on Thursday, which is a welcome sign. But, FII flows remain erratic and are yet to signal a decisive turnaround. The start today is likely to be a good one on the back of a healthy trend across global markets. Things may turn a little choppy later in the day as market participants would be cautious ahead of next week’s Budget session.

Railway Budget is scheduled for Feb. 24 while the Union Budget will be presented on Feb. 28. GDP data for Q3 will also be released on the same day. One will also have to contend with the F&O expiry next week.

The Indian market may meet some resistance after a strong pull-back. The good thing is that sentiment has improved. The broad range for the Nifty is expected at 5300-5700.

Market to open in GREEN & Rally to Continue

Overall outlook positive

Sector Watch:

Education, Banking, Fertilizer & Railway Related Stocks

18.02.2011

NIFTY FO CLOSED @ 5550 AS ON 17.02.2011

NIFTY FO has resistance @ 5577 - 5591; above which other resistance levels are @ 5603 -5613. In down side support levels are @ 5519 - 5503 levels; below which other support levels are @ 5493 - 5481 levels in FEBRUARY - 2011. I am positive for next week above 5613 level but be with the trend. Let the market decide further moves. As we are saying from many days Buying is suggested in falls only... and its still a better strategy in the given scenario...... One can go for buy at those levels also, but in absence of that its time to BOOK PROFIT now. This is a pessimistic outlook but that's the way we tend to be, in this market.

Pre Market Ideas

morning call,
BUY and HOLD
BGRENERGY AT 519
SL 515
target 523,527

Corporate Snippets

±  SAIL has initiated the process for its Rs70bn follow-on public offer and is planning to enter the market by March end or early April. (ET)

±  The government will expedite a decision on the controversial US$9.6bn Cairn-Vedanta deal but it will not accept any deadline from private companies. (ET)

±  NTPC has sought long-term pricing comfort from Petronet LNG Ltd. (BS)

±  BHEL has announced it has successfully test run its first indigenously manufactured turbine developed in collaboration with GE of the US and plans to deliver two more units by the end of the current fiscal. (BL)

±  IOC is losing a record Rs2.4bn per day on selling auto and cooking fuel below cost as government continues to bar it from raising rates in line with spurt in raw material cost. (ET)

±  IOC has sought a full rollback of duty on crude to keep petroleum prices under check. (ET)

±  Close on the heels of a settlement of a Class Action law suit in the US for US$125mn, Mahindra Satyam is planning to sue the former Satyam management and the company’s erstwhile auditor Price Waterhouse for a possible monetary damages claim. (ET)

सेन्सेक्स (18506.82) +205.92 अंक चढ्कर, नीफ़्टी (5546.45) +64.75 अंक चढ्कर, बंद..

Market to open with 
 positive note

&

Likely to range bound 
during the session

Sector Watch: 
Banking, OMC, Metal &
Railway Related Stocks

Pre Market Ideas

Buyand hold

HPCL 355

s/L  351 

target  357 358

Corporate Snippets

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Nifty – Long Calendar Straddle

Sell Nifty Feb 5500 CE and 5500 PE at 120 and Buy Nifty March 5500 CE and 5500 PE at 320. Net premium out flow is around 200. This is an excellent strategy for around 14 days and can yield around 200 points premium in profit. So this gives a Risk Reward of around 1:1. The break even is at 5300 and 5700, however the B.E.P is calculate just adding the premium. This is an excellent strategy as the time decay is adjusted against the selling of Feb 5500 Options and the swings in Nifty will be captured by the Long 5500 March options.

सेन्सेक्स (18300.90) +27.10 अंक चढ्कर, नीफ़्टी (5481.70) +00.70 अंक चढ्कर, बंद..

RELINFRA; Intraday target achived at 641.90, Book profit

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Market Commentary ..

The start of 2011 hasn’t been great for Indian markets, but lately there are some signs of a reversal in that trend. The key question is whether the current upswing will sustain?

We may see some consolidation in the run up to the Budget and the main indices may remain in a sideways pattern. Unless there is follow-up buying by big players (read institutions), the current rally may run out of gas after a while.

At the same time, any fresh downside will be limited as earnings growth has been good if not spectacular. Overall, the India growth story is not under any major threat. The Government appears to be taking a few right steps in a bid to shore up UPA II’s sagging image. Globally too, things seem to be settling down.

So, medium- to long-term investors must utilise any further dips to snap up quality names. Traders should remain a little cautious as volatility is here to stay.

The Nifty is expected to trade in the range of 5380-5450, before hitting 5600. The broad range could be between 5300 and 5600. Watch out for the 200-DMA level of 5630.

Market to open flattish to negative

Profit booking is likely on higher level

Keep watch on small-mid cap stocks

Sector Watch:

Tyre, OMC, Banking, Railway Related Stocks

Sector Avoid: aviation, sugar & Metal

NIFTY FO CLOSED @ 5476 AS ON 15.02.2011

NIFTY FO has resistance @ 5490 - 5509, above which other resistance levels are @ 5519 -5533. In down side support levels are @ 5447 - 5430 levels; below which other support levels are @ 5419 - 5409 levels in FEBRUARY - 2011. I am positive for next week above 5540 level but be with the trend. Let the market decide further moves. As we are saying from many days Buying is suggested in falls only... and its still a better strategy in the given scenario...... One can go for buy at those levels also, but in absence of that its time to BOOK PROFIT now. This is a pessimistic outlook but that's the way we tend to be, in this market.