Key developments during the week
• India week to Jul 25 rainfall 54.2 mm, 20% below normal
• Wockhardt says sold nutrition business to Danone for 12.8 bln rupees
• Lupin aims to launch generic of GlaxoSmithKline's Advair
• Tata Coffee to expand instant coffee unit
• Essar moves court against ONGC for keeping it out of offshore tender
• Swiss authorities put CBI investigation over Reliance‐Swan on hold
• Fin min secy Mittal tells PSU banks to get out of lazy habits
• Govt asks cos to sell 266,000 tn more sugar from unsold levy quota
• Madhya Pradesh govt OKs land allotment for NTPC's 3,960 MW project
• Jet Airways says still looking at raising funds via rights issue
• Indraprastha Gas says PNGRB moved Supreme Court against HC order
• Hero MotoCorp to set up global parts centre in Rajasthan
• IOC plans to invest 70‐80 bln rupees in Gujarat acetic acidJV unit
• S&P says Indian banks' asset quality to deteriorate on econ slowdown
• Aurobindo Pharma gets US FDA nod for generic clarithromycin tablets
• SBI head says no immediate concern on farm loans turning into NPAs
Domestic events week ahead
• Jul 31: RBI to release first quarter policy review.
• Jul 31: Government finances for Apr‐Jun, by CGA.
• Jul 31: CPI for industrial workers for June, by Labour Bureau.
• Aug 1: Manufacturing PMI for July, by HSBC.
• Aug 1: Trade data for June, by commerce and industry ministry.
• Aug 1: Automobile sales data for July, by SIAM.
• Aug 3: Services PMI and composite PMI for July, by HSBC.
Global events week ahead
• Jul 24: French Flash Manufacturing PMI, French Flash Services PMI, Flash Manufacturing PMI of Europe, FlashServices PMI.
• Jul 25: German Retail Sales m/m, Prelim GDP q/q of Britain, Crude Oil Inventories of US.
• Jul 26: M3 Money Supply y/y of Europe, Unemployment Claims of US.
• Jul 27: German Prelim CPI m/m, Advance GDP q/q of US.
Weekly Sector Outlook and Stock Picks
Auto sector ‐ monthly sales number to set trend
The Reserve Bank of India's first quarter policy review on Tuesday and monthly sales numbers by automakers due Wednesday are expected to set the trend for auto stocks in the week. Hero MotoCorp, Mahindra & Mahindra and Bajaj Auto are expected to come out with better sales numbers for July. Maruti is expected to be rangebound in the coming week with a slightly negative bias, adding that any update on the Manesar issue will be eyed by the market. Maruti Suzuki's plant in Manesar, Haryana has been shut since Jul 18 following labour riot.The company will detail its Apr‐Jun results on Saturday.
Any significant change in repo rate by the Reserve Bank on Tuesday will lend direction to the broad market and interestsensitive
auto stocks.
Capital Goods sector ‐ In narrow range; eye RBI policy Tuesday
Shares of capital goods and engineering companies are likely move in a narrow range ahead of Reserve Bank of India's first‐quarter monetary policy review on Tuesday. According to a poll, expects the RBI governor to keep the repo rate unchanged at 8.0%. High interest costs have been hurting Indian capital goods and engineering companies for a while now. RBI has hiked the repo rate, at which it lends to banks under its liquidity adjustment facility, by a cumulative 175
basis points since January 2011. High interest rates, coupled with industrial slowdown and paucity of orders have strained the operating margins of these capital‐intensive engineering and construction companies.Shares of Suzlon Energy are likely to be in focus Monday as the company today redeemed outstanding foreign currencyconvertible bonds worth $360 mln. IRB Infrastructure shares are also likely to see an uptick as the company postedhigher‐than‐estimated net profit and net sales for Apr‐Jun.
FMCG Sector ‐ Seen up this week tracking Apr‐Jun results
Shares of major fast‐moving consumer goods companies are seen up in the week ahead tracking the positive Apr‐Junearnings of companies such as ITC and Hindustan Lever. Index heavyweight Hindustan Unilever's Apr‐Jun earnings,declared Monday, exceeded street expectations and aided a 4.2% rally in its stock during the week.
Marico Ltd and Godrej Consumer Products Ltd will declare their Apr‐Jun earnings on Aug 3 and Aug 4, respectively, and these will dictate the trend in these stocks. The companies are expected to post a healthy growth in earnings on robust sales volume growth and lower raw material costs.Over the past week, the BSE FMCG index gained 0.8% on positive Apr‐Jun earnings of Hindustan Unilever and ITC, while the broader indices lost nearly 2% of their value. The momentum in
the FMCG stocks is expected to continue through this week. Shares of FMCG companies are expected to continueoutperforming the broader market due to economic slowdown that has affected other sectors more than FMCG companies.
Cement Sector – Movement to be stock‐specific, earnings eyed
Movement in shares of major cement makers is likely to be stock‐ specific this week as investors look at companies' Apr‐Jun earnings to take a view on the scrip. Ambuja Cements, which rose nearly 8% this week after it posted a "rock solid"performance in Apr‐Jun, may rise more this week. Improved realisation, and high sales volumes took Ambuja Cements'net profit for Apr‐Jun up 35% year‐on‐year to 469 cr rupees. The company's net sales rose 18% to 2566 cr rupees. Shares
of ACC may also trade slightly up, reacting to satisfactory earnings for the quarter. The company posted a 26% on‐yearincrease in net profit at 414 cr rupees on the back of a 15% rise in net sales at 2919 cr rupees.Jaiprakash Associates will detail its quarterly earnings on Tuesday. Madras Cements' results on Thursday, and India Cements' numbers on Aug 13.
IT Sector ‐ Stock‐specific movement this week; earnings eyed
Shares of major information technology firms are likely to see stock‐specific movement this week, based on Apr‐Junearnings announced by these companies. HCL Technologies, which posted a robust year‐on‐year growth for Apr‐Jun.Infosys and Wipro, which disappointed investors with poor earnings for Apr‐Jun, are likely to continue seeing lack ofinvestor interest this week. Tuesday, Wipro posted a lower‐than‐expected net profit for Apr‐Jun, and shared a tepid guidance for Jul‐Sep, on the back of delays in decision‐making by clients, and order closures
Oil Sector ‐ Marketing cos seen subdued this week
Shares of the three state‐owned oil marketing companies are seen subdued this week despite expectations of hike in prices of regulated fuels in the near future. Softening crude oil prices may give some upside to the shares of Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd and Hindustan Petroleum Corp Ltd if the rupee remains stable at current levels or stages a recovery. Talk of a hike in diesel prices has been going on for the past few weeks but the government has not yet shown any indication. The market trend will also be a key factor in determining the trend in these stocks but overall volumes in the sector may remain subdued as the focus will be on interest rate sensitive stocks ahead of Reserve Bank of India's first quarter policy review on Tuesday and also on companies announcing Apr‐Jun results.
Most market participants do not expect the RBI to cut key rates as poor monsoon is likely to keep inflation at levelsabove its comfort zone. So, overall market sentiment is seen negative.
Steel Stocks Outlook ‐ Seen rangebound in absence of triggers
Shares of steel companies are seen rangebound this week in the absence of any stock‐specific triggers and will track key indices. This week the market trend will mainly depend on Reserve Bank of India's first‐quarter monetary policy review on Tuesday. Last week, Jindal Steel and Power and JSW Steel reported their Apr‐Jun earnings. Jindal Steel's earnings were hit mainly due to a provision of 5.74 bln rupees on account of impairment of its investment in Bolivia. Earlier this
month, the company terminated its iron ore mining and steel manufacturing projects in Bolivia terming its government non‐investor friendly. The company's consolidated net profit fell 58% on year to 3.85 bln rupees while net sales rose 18.9% on year to 46.80 bln rupees. JSW Steel reported a sharp 90% year‐on‐year decline in consolidated net profit at 500 mln rupees due to foreign exchange and associate company losses. However, strong sales volume and realisation
lifted consolidated net sales by 33% on year to 99.02 bln rupees.
The market will now await earnings of Tata Steel and Steel Authority of India scheduled over the next fortnight, which will decide the trend for the steel stocks going forward. Steel companies will continue to face subdued demand over the next two to three months due to poor monsoon and macro economic uncertainties.
Bank sector‐ Mixed this week; RBI policy review in focus
Bank stocks are seen trading in a mixed trend in the coming week, with investors eyeing cues from the Reserve Bank of India's policy review on Tuesday along with cues from Apr‐Jun earnings of banks. Moderation in India's inflation and growth rate notwithstanding, Reserve Bank of India Governor D. Subbarao may leave key rates untouched this monthend citing sticky inflationary expectations and uncertain monsoon conditions.
Most banks have reduced their base rates by just 25 basis points since January despite the RBI reducing CRR by 125 bps and trimming repo rate by 50 basis points. However, street expect any move by the RBI to cut policy rates or banks to reduce loan rates as a positive as it will boost credit demand which has been a laggard so far, even though there may be some short‐term hit on margins.
Another key factor to eye in the coming week will be Apr‐Jun earnings of banks like Bank of Baroda, Indian Overseas Bank, Syndicate Bank, Corporation Bank, Oriental Bank of Commerce and IDBI Bank. Union Bank of India, Central Bank of India, Bank of India, Punjab National Bank and Canara Bank, the large state‐owned banks that have declared results so far have all indicated weak asset quality performance. Dena Bank is the only state‐owned bank that showed improved
asset quality in Apr‐Jun.
Pharma sector – To track Apr‐Jun results this week
The Reserve Bank of India's monetary policy Tuesday and Apr‐Jun earnings of companies are likely to provide direction to pharmaceutical stocks this week. Traders are likely to be cautious and invest in less risky stocks on Monday, ahead of the Jul 31 monetary policy of the RBI. Being defensive in nature, pharmaceutical stocks are likely to attract investors
Monday. Shares of Cipla Ltd will be in focus as the company announces its quarterly earnings on Tuesday. Shares of GlaxoSmithKline Pharmaceuticals and Pfizer Ltd are also likely to fall this week as the NPPA has cut the prices of vitamin C drugs ranging from 0.12% to 37.7% of the existing rates. Shares of Dr Reddy's Laboratories Ltd are seen gaining this week as the US Food and Drug Administration has lifted the year‐long import ban from the Mexican intermediates and
active pharmaceutical ingredients manufacturing unit of the company. The company can now start importing products from the unit to the US.
Market Range for Week 4910‐ 5250
NIFTY
Resistance – Nifty facing Resistance level @5150 level above this level it may go up to @5180 &@ 5250 level.
Support ‐ Support comes for market @5080 level for Nifty; below this level Nifty next support @5050 and @4980 will be the major support for Market.
Technical – Last week Nifty opened at 5163 & it made a high of 5164.Last week we have seen some selling from higher level. Nifty made a low of 5032 & closed at 5099.Last week Nifty drag 132 points from its high & on weekly basis it closed at 106 point’s lower. Sensex made a weekly high of 17047 & a low of 16598 almost it drags 449 points in the week from its high.So overall last week we have seen some profit booking from higher level.
For the coming week the market range we expect 4910‐5250.
Weekly View –
Last week we had expected market range (5080‐5350) & market made a low of 5032 & made a high of 5164, so overall it hold over both side range.
In last week report we had mentioned, on daily chart market was above 100&50 DMA support level.on weekly chart it was not able to cross 100WMA, but it was holding upper channel line, because of all that we had mentioned we can seen some consolidation or some volatility & all we have seen same.Now on daily chart market trading below 50, 100,&200DMA, but osilator showing some oversold.On weekly chart market still not able to cross 100WMA & osilator
showing some negative crossover. So overall 5050 will be major support level close below that we can see some downside in the market & 5150‐5180 will be major resistance at higher level close above that we can see some upside in the market.
On Friday, U.S stocks was up 188 points, or 1.5%,to end above the 13,000 mark, a psychologically important level it has not crosses since early may.The S&P500 added 26 points, or 1.9% & the Nasdaq gained 65 points, or 2.2%.The major indexes are all ended higher for the week. The Dow rose 2% for the week; the S&P added 1.7% & the Nasdaq gained 1.1%.
Market Commentary ‐
Next batch of first quarter corporate earnings, the Reserve Bank of India's (RBI) monetary policy review, progress of the monsoon rains and monetary policy review by US Federal Reserve will dictate near term trend on the bourses. Automobile and cement stocks will be focus as companies from these two sector start unveil monthly sales volume data for July 2012 from Wednesday, 1 August 2012.
The RBI is unlikely to cut its key policy rate viz. the repo rate at first quarter review of the Monetary Policy 2012‐13 on Tuesday, 31 July 2012, to guard against higher inflation as the country faces the possibility of a drought. The RBI unexpectedly left its key lending rate unchanged at its last meeting in June 2012, citing inflationary concerns.
The volume of monsoon rain in India in the week ended July 25 was 20% below the long‐term average, as rainfall remained deficient in northern and western parts of the country, the India Meteorological Department said on Thursday, 26 July 2012. Total rainfall so far this season is 22% below the long‐period average. The monsoon's slow progress across the country has heightened concerns that output of summer‐sown crops such as oilseeds, sugar and pulses may fall. A ministerial panel may soon review the drought‐like situation in the country, Farm Minister Sharad
Pawar said on Thursday, 26 July 2012, after a meeting with the country's food minister.
Slowing growth in investment remains a cause for concern for India. Investment makes up 35% of India's economic activity.
• India week to Jul 25 rainfall 54.2 mm, 20% below normal
• Wockhardt says sold nutrition business to Danone for 12.8 bln rupees
• Lupin aims to launch generic of GlaxoSmithKline's Advair
• Tata Coffee to expand instant coffee unit
• Essar moves court against ONGC for keeping it out of offshore tender
• Swiss authorities put CBI investigation over Reliance‐Swan on hold
• Fin min secy Mittal tells PSU banks to get out of lazy habits
• Govt asks cos to sell 266,000 tn more sugar from unsold levy quota
• Madhya Pradesh govt OKs land allotment for NTPC's 3,960 MW project
• Jet Airways says still looking at raising funds via rights issue
• Indraprastha Gas says PNGRB moved Supreme Court against HC order
• Hero MotoCorp to set up global parts centre in Rajasthan
• IOC plans to invest 70‐80 bln rupees in Gujarat acetic acidJV unit
• S&P says Indian banks' asset quality to deteriorate on econ slowdown
• Aurobindo Pharma gets US FDA nod for generic clarithromycin tablets
• SBI head says no immediate concern on farm loans turning into NPAs
Domestic events week ahead
• Jul 31: RBI to release first quarter policy review.
• Jul 31: Government finances for Apr‐Jun, by CGA.
• Jul 31: CPI for industrial workers for June, by Labour Bureau.
• Aug 1: Manufacturing PMI for July, by HSBC.
• Aug 1: Trade data for June, by commerce and industry ministry.
• Aug 1: Automobile sales data for July, by SIAM.
• Aug 3: Services PMI and composite PMI for July, by HSBC.
Global events week ahead
• Jul 24: French Flash Manufacturing PMI, French Flash Services PMI, Flash Manufacturing PMI of Europe, FlashServices PMI.
• Jul 25: German Retail Sales m/m, Prelim GDP q/q of Britain, Crude Oil Inventories of US.
• Jul 26: M3 Money Supply y/y of Europe, Unemployment Claims of US.
• Jul 27: German Prelim CPI m/m, Advance GDP q/q of US.
Weekly Sector Outlook and Stock Picks
Auto sector ‐ monthly sales number to set trend
The Reserve Bank of India's first quarter policy review on Tuesday and monthly sales numbers by automakers due Wednesday are expected to set the trend for auto stocks in the week. Hero MotoCorp, Mahindra & Mahindra and Bajaj Auto are expected to come out with better sales numbers for July. Maruti is expected to be rangebound in the coming week with a slightly negative bias, adding that any update on the Manesar issue will be eyed by the market. Maruti Suzuki's plant in Manesar, Haryana has been shut since Jul 18 following labour riot.The company will detail its Apr‐Jun results on Saturday.
Any significant change in repo rate by the Reserve Bank on Tuesday will lend direction to the broad market and interestsensitive
auto stocks.
Capital Goods sector ‐ In narrow range; eye RBI policy Tuesday
Shares of capital goods and engineering companies are likely move in a narrow range ahead of Reserve Bank of India's first‐quarter monetary policy review on Tuesday. According to a poll, expects the RBI governor to keep the repo rate unchanged at 8.0%. High interest costs have been hurting Indian capital goods and engineering companies for a while now. RBI has hiked the repo rate, at which it lends to banks under its liquidity adjustment facility, by a cumulative 175
basis points since January 2011. High interest rates, coupled with industrial slowdown and paucity of orders have strained the operating margins of these capital‐intensive engineering and construction companies.Shares of Suzlon Energy are likely to be in focus Monday as the company today redeemed outstanding foreign currencyconvertible bonds worth $360 mln. IRB Infrastructure shares are also likely to see an uptick as the company postedhigher‐than‐estimated net profit and net sales for Apr‐Jun.
FMCG Sector ‐ Seen up this week tracking Apr‐Jun results
Shares of major fast‐moving consumer goods companies are seen up in the week ahead tracking the positive Apr‐Junearnings of companies such as ITC and Hindustan Lever. Index heavyweight Hindustan Unilever's Apr‐Jun earnings,declared Monday, exceeded street expectations and aided a 4.2% rally in its stock during the week.
Marico Ltd and Godrej Consumer Products Ltd will declare their Apr‐Jun earnings on Aug 3 and Aug 4, respectively, and these will dictate the trend in these stocks. The companies are expected to post a healthy growth in earnings on robust sales volume growth and lower raw material costs.Over the past week, the BSE FMCG index gained 0.8% on positive Apr‐Jun earnings of Hindustan Unilever and ITC, while the broader indices lost nearly 2% of their value. The momentum in
the FMCG stocks is expected to continue through this week. Shares of FMCG companies are expected to continueoutperforming the broader market due to economic slowdown that has affected other sectors more than FMCG companies.
Cement Sector – Movement to be stock‐specific, earnings eyed
Movement in shares of major cement makers is likely to be stock‐ specific this week as investors look at companies' Apr‐Jun earnings to take a view on the scrip. Ambuja Cements, which rose nearly 8% this week after it posted a "rock solid"performance in Apr‐Jun, may rise more this week. Improved realisation, and high sales volumes took Ambuja Cements'net profit for Apr‐Jun up 35% year‐on‐year to 469 cr rupees. The company's net sales rose 18% to 2566 cr rupees. Shares
of ACC may also trade slightly up, reacting to satisfactory earnings for the quarter. The company posted a 26% on‐yearincrease in net profit at 414 cr rupees on the back of a 15% rise in net sales at 2919 cr rupees.Jaiprakash Associates will detail its quarterly earnings on Tuesday. Madras Cements' results on Thursday, and India Cements' numbers on Aug 13.
IT Sector ‐ Stock‐specific movement this week; earnings eyed
Shares of major information technology firms are likely to see stock‐specific movement this week, based on Apr‐Junearnings announced by these companies. HCL Technologies, which posted a robust year‐on‐year growth for Apr‐Jun.Infosys and Wipro, which disappointed investors with poor earnings for Apr‐Jun, are likely to continue seeing lack ofinvestor interest this week. Tuesday, Wipro posted a lower‐than‐expected net profit for Apr‐Jun, and shared a tepid guidance for Jul‐Sep, on the back of delays in decision‐making by clients, and order closures
Oil Sector ‐ Marketing cos seen subdued this week
Shares of the three state‐owned oil marketing companies are seen subdued this week despite expectations of hike in prices of regulated fuels in the near future. Softening crude oil prices may give some upside to the shares of Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd and Hindustan Petroleum Corp Ltd if the rupee remains stable at current levels or stages a recovery. Talk of a hike in diesel prices has been going on for the past few weeks but the government has not yet shown any indication. The market trend will also be a key factor in determining the trend in these stocks but overall volumes in the sector may remain subdued as the focus will be on interest rate sensitive stocks ahead of Reserve Bank of India's first quarter policy review on Tuesday and also on companies announcing Apr‐Jun results.
Most market participants do not expect the RBI to cut key rates as poor monsoon is likely to keep inflation at levelsabove its comfort zone. So, overall market sentiment is seen negative.
Steel Stocks Outlook ‐ Seen rangebound in absence of triggers
Shares of steel companies are seen rangebound this week in the absence of any stock‐specific triggers and will track key indices. This week the market trend will mainly depend on Reserve Bank of India's first‐quarter monetary policy review on Tuesday. Last week, Jindal Steel and Power and JSW Steel reported their Apr‐Jun earnings. Jindal Steel's earnings were hit mainly due to a provision of 5.74 bln rupees on account of impairment of its investment in Bolivia. Earlier this
month, the company terminated its iron ore mining and steel manufacturing projects in Bolivia terming its government non‐investor friendly. The company's consolidated net profit fell 58% on year to 3.85 bln rupees while net sales rose 18.9% on year to 46.80 bln rupees. JSW Steel reported a sharp 90% year‐on‐year decline in consolidated net profit at 500 mln rupees due to foreign exchange and associate company losses. However, strong sales volume and realisation
lifted consolidated net sales by 33% on year to 99.02 bln rupees.
The market will now await earnings of Tata Steel and Steel Authority of India scheduled over the next fortnight, which will decide the trend for the steel stocks going forward. Steel companies will continue to face subdued demand over the next two to three months due to poor monsoon and macro economic uncertainties.
Bank sector‐ Mixed this week; RBI policy review in focus
Bank stocks are seen trading in a mixed trend in the coming week, with investors eyeing cues from the Reserve Bank of India's policy review on Tuesday along with cues from Apr‐Jun earnings of banks. Moderation in India's inflation and growth rate notwithstanding, Reserve Bank of India Governor D. Subbarao may leave key rates untouched this monthend citing sticky inflationary expectations and uncertain monsoon conditions.
Most banks have reduced their base rates by just 25 basis points since January despite the RBI reducing CRR by 125 bps and trimming repo rate by 50 basis points. However, street expect any move by the RBI to cut policy rates or banks to reduce loan rates as a positive as it will boost credit demand which has been a laggard so far, even though there may be some short‐term hit on margins.
Another key factor to eye in the coming week will be Apr‐Jun earnings of banks like Bank of Baroda, Indian Overseas Bank, Syndicate Bank, Corporation Bank, Oriental Bank of Commerce and IDBI Bank. Union Bank of India, Central Bank of India, Bank of India, Punjab National Bank and Canara Bank, the large state‐owned banks that have declared results so far have all indicated weak asset quality performance. Dena Bank is the only state‐owned bank that showed improved
asset quality in Apr‐Jun.
Pharma sector – To track Apr‐Jun results this week
The Reserve Bank of India's monetary policy Tuesday and Apr‐Jun earnings of companies are likely to provide direction to pharmaceutical stocks this week. Traders are likely to be cautious and invest in less risky stocks on Monday, ahead of the Jul 31 monetary policy of the RBI. Being defensive in nature, pharmaceutical stocks are likely to attract investors
Monday. Shares of Cipla Ltd will be in focus as the company announces its quarterly earnings on Tuesday. Shares of GlaxoSmithKline Pharmaceuticals and Pfizer Ltd are also likely to fall this week as the NPPA has cut the prices of vitamin C drugs ranging from 0.12% to 37.7% of the existing rates. Shares of Dr Reddy's Laboratories Ltd are seen gaining this week as the US Food and Drug Administration has lifted the year‐long import ban from the Mexican intermediates and
active pharmaceutical ingredients manufacturing unit of the company. The company can now start importing products from the unit to the US.
Market Range for Week 4910‐ 5250
NIFTY
Resistance – Nifty facing Resistance level @5150 level above this level it may go up to @5180 &@ 5250 level.
Support ‐ Support comes for market @5080 level for Nifty; below this level Nifty next support @5050 and @4980 will be the major support for Market.
Technical – Last week Nifty opened at 5163 & it made a high of 5164.Last week we have seen some selling from higher level. Nifty made a low of 5032 & closed at 5099.Last week Nifty drag 132 points from its high & on weekly basis it closed at 106 point’s lower. Sensex made a weekly high of 17047 & a low of 16598 almost it drags 449 points in the week from its high.So overall last week we have seen some profit booking from higher level.
For the coming week the market range we expect 4910‐5250.
Weekly View –
Last week we had expected market range (5080‐5350) & market made a low of 5032 & made a high of 5164, so overall it hold over both side range.
In last week report we had mentioned, on daily chart market was above 100&50 DMA support level.on weekly chart it was not able to cross 100WMA, but it was holding upper channel line, because of all that we had mentioned we can seen some consolidation or some volatility & all we have seen same.Now on daily chart market trading below 50, 100,&200DMA, but osilator showing some oversold.On weekly chart market still not able to cross 100WMA & osilator
showing some negative crossover. So overall 5050 will be major support level close below that we can see some downside in the market & 5150‐5180 will be major resistance at higher level close above that we can see some upside in the market.
On Friday, U.S stocks was up 188 points, or 1.5%,to end above the 13,000 mark, a psychologically important level it has not crosses since early may.The S&P500 added 26 points, or 1.9% & the Nasdaq gained 65 points, or 2.2%.The major indexes are all ended higher for the week. The Dow rose 2% for the week; the S&P added 1.7% & the Nasdaq gained 1.1%.
Market Commentary ‐
Next batch of first quarter corporate earnings, the Reserve Bank of India's (RBI) monetary policy review, progress of the monsoon rains and monetary policy review by US Federal Reserve will dictate near term trend on the bourses. Automobile and cement stocks will be focus as companies from these two sector start unveil monthly sales volume data for July 2012 from Wednesday, 1 August 2012.
The RBI is unlikely to cut its key policy rate viz. the repo rate at first quarter review of the Monetary Policy 2012‐13 on Tuesday, 31 July 2012, to guard against higher inflation as the country faces the possibility of a drought. The RBI unexpectedly left its key lending rate unchanged at its last meeting in June 2012, citing inflationary concerns.
The volume of monsoon rain in India in the week ended July 25 was 20% below the long‐term average, as rainfall remained deficient in northern and western parts of the country, the India Meteorological Department said on Thursday, 26 July 2012. Total rainfall so far this season is 22% below the long‐period average. The monsoon's slow progress across the country has heightened concerns that output of summer‐sown crops such as oilseeds, sugar and pulses may fall. A ministerial panel may soon review the drought‐like situation in the country, Farm Minister Sharad
Pawar said on Thursday, 26 July 2012, after a meeting with the country's food minister.
Slowing growth in investment remains a cause for concern for India. Investment makes up 35% of India's economic activity.
