Tag Archives: RR Research Information

SENSEX Gets Cheaper: May see new highs in September

  • SENSEX has gained 5.8% in past two months whereas 12 month profit projections have climbed 7.2% (according to about 800 analyst forecasts compiled by Bloomberg)
  • SENSEX is valued at 15.5 times estimated profit (forward PE), down from this year’s high of 16.3, and it makes Sensex cheap compared to its average
  • Major positives –
  1. Falling crude oil prices are reducing import costs
  2. Rising confidence that policies will revive economy
  3. Main positive policy changes are – reduction in bureaucracy, faster project approvals, lower income taxes, attracting more FDI, working on land acquisition laws, focus on reducing coal shortage, initiatives on digitization and corruption free government, focus on roads and other infra, focus on manufacturing sector and job creation
  4. Results of government actions will take time but there are clear signs of action, focus, and accountability – and it has improved business sentiment

Technical View

Nifty has maintained its uptrend and if it sustains above 7850, it may cross 8000 which is 161.8% Fibonacci Level. RSI is also indicating a bullish trending market. Above 8000, Nifty has a target of 8300.

SENSEX 30 augBelow 7850, it has strong support at 7730 and 7650.

RECOMMENDATION:

Several midcap, small-cap, and infrastructure stocks have fallen sharply, offering excellent opportunity to investors to enter.

The markets still offer opportunities for medium to long term investors in Equity Mutual Funds.

Click here to see our other Research Reports or visit:- http://goo.gl/cK9K67

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Filed under Currency Update, Debt News, Equity Market, Finance

Technical: Wait & Watch & Good time to Switch

Nifty future has broken its crucial supports of 7640 & 7530. The markets may fall further and Nifty may hover between 7300-7450. At these levels, 7300 is a strong support and can be broken only if there is a very strong negative event.

wait and watch good timesWe reiterate that lower levels will offer an attractive investment opportunity for equities. Immediate market movements are based on risk aversion and escalation in tensions in Middle East. Money is moving from risk assets to safety of gold. The hike in Rail fares has increased fears of inflationary trend & interest rates have moved up by 20 basis points in the last one week.

Click here to see our other research reports:- http://www.rrfinance.com/Reserch/ResearchHome.aspx

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Filed under Commodity News, Currency Update, Debt News, Equity Market, Finance, World News

Wholesale price index (WPI) eased to 5.2 in April from 5.7% March 2014!

Key benchmark indices edged higher amid high intraday volatility after the latest data showed that inflation based on monthly wholesale price index (WPI) eased to 5.2 in April 2014 from 5.7% in March 2014. The barometer index, the S&P BSE Sensex, close up by 90.48 points or 0.38%, up close to 170 points from the day’s low and off about 60 points from the day’s high. The market sentiment was boosted by data showing that foreign funds made substantial purchases of Indian stocks on Wednesday, 14 May 2014.

WPI Index

WPI Index

Who Moved and Why

1) Adani Ports & SEZ gains after Q4 results.
2) LG Balakrishnan gallops to record high on strong results, liberal bonus issue.
3) Tata Motors slips in volatile trade as global wholesales decline in April.
4) Bajaj Auto slides after weak quarterly earnings.
5) Bank of India slips after weak Q4 earnings.
6) Shakti Pumps spurts to 52-week high after stellar Q4 outcome.
7) Sun Pharma gains after settling Novartis lawsuit.
8) Aurobindo Pharma gains after MSCI inclusion.

Read detail analysis report here:http://rrfinance.com/Reserch/Pdf/07-July/DMR/15_may_equity_closing_update.pdf

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Filed under Commodity News, Currency Update, Debt News, Equity Market, Finance

Ukraine Conflict-Impact on India

The ongoing Ukrainian conflict has created nervousness amongst investors. But as far as India is concerned, it is not expected to face any major impact of this conflict. India’s trade with erstwhile USSR, which used to account for 26% of the country’s total trade, has now been reduced to less than 1%. The main effects of this conflict are to be seen in Europe and Russia. It has alerted EU countries to Russian threat and it has helped in uniting them, whereas Russia is increasingly getting isolated in international community.

Ukrainian problem started simmering in the region when pro-Russia leader Viktor Yanukovych was ousted on February 21. Putin feared European Union dominance in Ukraine and started supporting pro Russian groups in Ukraine leading to annexation of Crimea to Russia. The situation in Ukraine is deteriorating with pro Russian groups increasingly taking control. The Ukrainian government and its military are not strong enough to take on Russia supported groups and in most probabilities Putin will be able to directly or indirectly take control of substantial parts of Ukraine.

Though this conflict will create economic disturbances at global level, it is not expected to have any major impact on India. The main effects of this conflict are explained below in brief –

Russia’s role to be diminished: Russia’s role in international affairs is diminished. Moscow has been de facto excluded from the Group of Eight industrialized powers. Its bids to join the Organization for Economic Cooperation and Development and the International Energy Agency are frozen. Western summits with Moscow are cancelled until further notice.

Energy diversification by countries to reduce risk: The energy map of Europe is being redrawn with accelerated action to reduce dependence on Russian oil and gas. EU states are set to build more liquefied natural gas terminals, upgrade pipeline networks and grids and expand a southern gas supplies through Georgia and Turkey to southern and central Europe. The EU gets a third of its oil and gas from Russia, and 40 percent of that gas is pumped across Ukraine. Europe may now look to tap its own shale gas reserves and expand nuclear power, despite environmental concerns.

China factor: The diplomatic alliance between Russia and China, which often vote together in the U.N. Security Council, could change in one of two directions – either rapprochement through a stronger energy partnership, with new pipelines being built to pump Russian oil and gas spurned by Europe to Beijing; or a cooling if China distances itself more from Putin’s behavior and sees less benefit in closer ties with an economically weakened and relatively isolated Moscow. For now, President Xi Jinping is refusing to take sides in public.

U.S. leadership: Washington’s global leadership role weakened by the rise of emerging powers and by retrenchment under President Barack Obama, has been partially restored. Despite his disengagement from wars in Iraq and Afghanistan and strategic “pivot” towards Asia, events have pushed Obama back into the old-fashioned role of “Leader of the Free World” in an East-West crisis in Europe. In Brussels last week Europeans appealed to Obama to sell them shale gas, and both sides agreed to speed talks on a transatlantic free trade and investment pact.

EU united: The European Union has been reunited, at least for now, by the return of a common external threat. This may have helped EU leaders overcome some long-running disputes.

Contest for Central Asia: Both Putin and the West are wooing central Asian autocrats in energy-rich Azerbaijan, Kazakhstan, Turkmenistan and Uzbekistan, drawing a discreet veil over their human rights records. If Russia weakens economically, they will want at least a foot in the Western camp.

Putin’s future: Russia’s leader is near the peak of his popularity, riding a wave of nationalist pride over Crimea. However, instability may grow if he comes under pressure from Russian business magnates angry at losing value on their businesses, forfeiting foreign investment in Russia and facing travel restrictions and asset freezes in the West. Most are loyal for now, but things may look different in six months’ time.

CONCLUSION: Russia may succeed in expanding its control over former soviet territories but the European countries have started ensuring energy security and the final impact on global economies will not be a catastrophic one. India may feel the pinch but it will not affect it strongly.

Resource:- http://www.prlog.org/12321194-ukraine-conflict-impact-on-india.html

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Filed under Commodity News, Currency Update, Debt News, Equity Market, Finance, World News

Currency Market: The Indian rupee continued to falter!

The Indian rupee continued to falter, retreating from an eight-month high hit last week, to post its second consecutive weekly fall after data showed the trade deficit widened to a five-month high in March. The data – showing the trade deficit widening to $10.5 billion from $8.13 billion in February on the back of falling exports – revived concerns about the current account deficit after a recent sharp narrowing. Investors will now be closely eyeing the consumer inflation data due on Tuesday, as well as the start of corporate earnings results next week, for a better snapshot of the domestic economy.

USD vs INR

Pre Opening Currency Market

Today’s Headlines

1) Dollar Holds Gain Before Manufacturing, Yellen; Aussie Weakens
2) Mexico’s Local Bonds Slump After Debt Offering
3) Retail Sales in U.S. Increased in March by Most Since 2012
4) Ruble Falls With Stocks as Ukraine Unrest Spurs Sanctions Threat
5) Brazilian Real Bears Foiled by Presidential Election

Read detail analysis report here:- http://www.rrfinance.com/reserch/MorningBell/Cr_MorningBell.pdf

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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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Shriram City gains after foreign brokerage initiates coverage!

Volatility ruled the roost in late trade as the key benchmark indices regained positive zone after erasing entire gains to hit intraday low in negative zone in mid-afternoon trade. The market breadth, indicating the overall health of the market, was negative. The barometer index, the S&P BSE Sensex closed up by 40.09 points or 0.18%, up 75.07 points from the day’s low and off 76.45 points from the day’s high.

Shri Ram CITY Gains

Shri Ram CITY Gains

Who Moved and Why

1) Shriram City gains after foreign brokerage initiates coverage.
2) Sintex Industries gallops on plan to divest stake in unit.
3) Dewan Housing Finance gains after block deals.
4) Suven Life Sciences gains after securing two product patents.
5) Educomp Solutions jumps after final approval of debt restructuring.
6) RPower gains after a large block deal.
7) Oberoi Realty jumps after winning Tata Steel Mumbai land.

Read detail analysis report here:- http://rrfinance.com/Reserch/Pdf/07-July/DMR/26th_March_equity_closing_update.pdf

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