Equity Technical Analysis-Fortnightly Update RR Research Information

Fundamentals

It is not just Modi factor that is driving the markets; most of the crucial macro economic factors have turned positive indicating better growth prospects for Indian economy. One of the major causes for the last correction in August was Rupee depreciation, which has recovered and stabilized now owing to prudent actions of Raghuram Rajan. The Balance of Payment has turned positive from negative. The current account deficit, which had touched an all-time high of 4.8 per cent in FY13 – leading to a massive depreciation in the rupee-has come down to 2.3 per centof GDP during the first three quarters of FY14.

Foreign exchange reserves have jumped from $1.088 billion to touch $295.45 billion. Foreign exchange reserves had hit a 39-month low on September 6, 2013 when it touched $274 billion. Following several steps taken by the central bank to encourage inflows, the reserves started rising. Crude prices are stable, inflation is cooling down, FDI is increasing –the outlook is definitely positive for investments.
Coal prices are also on a downtrend which is a big relief for the power sector as most of them are coal fired and were badly hit by coal shortage for last few years.

Nifty Technical

On the daily chart of nifty we can see nifty has broken its resistance level of 6360 after consolidating in the range of 6360-5970. Nifty short term and long term trend is up and currently it is trading above its 8 days, 13 days and 21 days EMA. RSI and MACD are showing strength in upward movement. Traders should avoid short selling and should buy on dips.

NIFTY Technical Analysis

NIFTY Technical Analysis

Upcoming Events

The Reserve Bank of India’s First Bi-monthly Monetary Policy Statement, 2014-15 on Tuesday, 1 April 2014, will dictate near term trend on the bourses.

Auto stocks will be in focus as companies from this sector will start reporting sales volume data for March 2014 starting Tuesday, 1 April 2014.

PSU OMCs will be in focus as state run oil marketing companies will review the fuel prices on 1 April 2014 based on the average imported oil price in the previous fortnight.

The next major trigger for the stock market is the outcome of the upcoming Lok Sabha elections. Lok Sabha elections will be held between 7 April 2014 and 12 May 2014 in nine phases. The counting of votes will be take place on 16 May 2014. The term of the current Lok Sabha expires on June 1 and the new House has to be constituted by May 31.

Stock Ideas

Stock Ideas

Fortnightly Headlines

1) Basel III deferral to ease pressure on banks: India Ratings
2) General Atlantic Partners, Apax Partners mulls buying 49 per cent stake in PNB Housing Finance.
3) Cisco to ship new video conferencing solution to India soon.
4) Gas companies like GAIL India, Reliance Industries, and BG India may have uniform sales pact with consumers.
5) BP, Niko seek arbitration over penalty for gas output decline.
6) Tata Power seeks compensation from CLP India.
7) Qualcomm gets nod to sell stake in JV to Bharti Airtel.
8) Airtel, Safaricom get conditional nod to buy Kenya’s yu Mobile.
9) GSM user base up at 71.10 cr in Feb: COAI.
10) Telecom Commission to come with graded penalty scheme for tacos soon.
11) I&B seek over Rs 2000 crore from DTH companies as license fee.
12) Sony LIV partners BoxTV for content sharing.
13) Take action against Zee News: EC tells NBA.

Read detail analysis report here: – http://www.rrfinance.com/Reserch/ResearchHome.aspx

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