Nifty investors -Free Intraday Tips: Stay tuned for live updates: MARKET MONITOR FOR WEEK ENDED 25/10/2013

INSTITUTIONAL ACTIVITY DURING THE WEEK

FII ACTIVITY (Rs. Crs)				DII ACTIVITY (Rs. Crs)
DATE	BUY	SELL	NET	DATE	BUY	SELL	NET
25/10/2013	2300.66	1673.67	626.99	25/10/2013	657.4	1155.35	-497.95
24/10/2013	2890.31	1898.48	991.83	24/10/2013	800.89	1536.29	-735.4
23/10/2013	2605.31	1960.51	644.8	23/10/2013	752.53	1298.1	-545.57
22/10/2013	2548.94	1754.04	794.9	22/10/2013	639.48	1484.78	-845.3
21/10/2013	2871.82	1840.03	1031.79	21/10/2013	782.48	1506.58	-724.1
WTD	13217	9126.73	4090.31	WTD	3632.78	6981.1	-3348.32

INDIAN MARKET PERFORMANCE DURING THE WEEK

During the week, domestic markets went through a choppy trade when major indices after a strong start showed sign of fatigue and declined sharply towards the end, snapping the week with loss of about a percent. Though, there was not much on the economy front, traders took cues largely from the global markets.

The start of the week was good with buying resuming on Planning Mr. Ahluwalia’s statement that Current Account Deficit (CAD) is likely to be lower than the projection of 3.8 percent of the GDP and India will be in a better position to neutralise the impact of the tapering of monetary stimulus by the US Fed.

Some boost also came in after RBI said that it has no immediate plan to close the dollar-swap window for oil companies and it will be done in a calibrated manner. Also, there was report that the DIPP is working on a proposal to grant interest subsidy to the manufacturing sector.

The latter half of the week witnessed consolidation and profit booking. Earnings season was in full swing and the street kept rewarding and punishing the stocks based on their performance.

The major being Wipro, though it reported a decent profit numbers for the quarter ended September 30, but its revenue performance lagged to the top tier players, on the other hand Hero MotoCorp, Kotak Mahindra Bank, Yes Bank surged on reporting better than expected numbers.

Markets kept reeling in red during the final days of the week lacking any support at upside with traders opting to book profit and remain on sidelines ahead of the crucial next week of F&O series expiry and when RBI will announce its second quarter monetary policy review with some section predicting another rise in repo rate by a quarter percent amid limited scope to cut key rates as demanded by industry to spur growth.

Indices wise, Nifty lost 44.45 points, Bank Nifty up by 151.60 points, BSE Sensex lost 199.37 points, BSE Mid-cap index was up by 70.25 points, while the Small-cap index up by 87.87 points. Capital Goods up by 457.87 points, Bankex up by 191.03 points, Consumer Durables up by 25.53 points and PSU up by 22.63 points were the only gainers on the BSE sectoral space, while Realty down -29.40 points, FMCG down 134.29 points, Health Care down 173.90 points, Oil & Gas down 123.25 points and Teck down 66.25 points were the top losers on the BSE sectoral front.

FIIs were net buyers in equity segment in the week with a net inflow of Rs 4090.31 crs while DIIs were net sellers worth Rs. -3348.32 crs. Larsen & Toubro up by 8.65% was the top gainer on Nifty and Bank of Baroda up by 7.27% was another top gainer on the Nifty. While BHEL down by 7.07% was the top loser & Jindal Steel & Power down by 6.84% was another major loser on the Nifty. For the coming week, 6090 and 6035 are likely to be good support levels for the Nifty, while the index may face resistance at 6225 and 6300 levels.

INDUSRY & ECONOMY NEWS

In a move that can cheer the telecom companies, TRAI has stuck to its recommendations for steep cuts in the floor price of spectrum for upcoming auctions as well as on spectrum refarming. The regulating body refused to make any changes to its earlier recommendation of lower prices for the fresh round of spectrum auctions and rebuffed a reconsideration suggested by DoT. Also, the regulator stuck to its stand of not calling for new auctions in the 800 MHz band, used by CDMA operators. TRAI which had been tasked by the government to work out fresh floor prices after auctions in November last year and March this year, had in September recommended about 37 percent cut in base price for 1800 Mhz spectrum band compared to the reserve price in the previous auction and running up to as high as 60% for 900 Mhz in key circles of Delhi, Mumbai and Kolkata.

WORLD MARKET BEHAVIOUR DURING THE WEEK

US MARKET:

The US markets extended their positive mood during the passing week as investors assessed corporate results and were contemplating that the lingering uncertainty in Washington means the Federal Reserve is unlikely to taper its bond buying program this year. The economic data which emerged during the week supported notions that the Federal Reserve’s monthly bond purchases would continue into next year. Chicago Fed president Charles Evans stated that the Federal Reserve could begin to reduce the pace of its $85 billion-a-month asset purchase program in December but would need several good economic reports before acting. Evans all but ruled out a move at the central bank’s meeting later this month, calling it a tough one given the lack of economic data from the federal government shutdown.

On the economy front, the number of people who applied for US unemployment benefits fell for the third straight week, but the level of initial claims remained elevated because of ongoing computer problems in California that prevented many applications from being processed on time. Initial claims fell by 12,000 to 350,000 in the week ended October 19. The four-week average of claims usually a more reliable number, jumped by 10,750 to 348,250 to mark the highest level since early July. Job openings barely rose in August, as gains in education and health services, manufacturing and construction were offset by declines in federal and state and local employment. Separately, the US trade deficit rose slightly to $38.8 billion in August from a downwardly revised $38.6 billion in July. Imports were basically flat at $228.0 billion, while exports edged down 0.1% to $189.2 billion.

The preliminary reading of Markit’s US flash manufacturing purchasing managers index slipped to 51.1 in October from 52.8 in September, the lowest level for a year. In October, output contracted for the first time since September 2009. New order growth was the weakest in six months. On the other hand, there was a modest rise in employment. Besides, a Federal Reserve’s most recent survey of economist conditions released last week found residential construction continued to increase at a moderate pace in September while business construction expanded at a relatively slower rate.

EUROPEAN MARKET:

The European markets sensed some relief during the week on signs of an improving global economy. Chinese factory activity hit a 7-month high in October, a sign that manufacturing is improving in Chinese economy. Bank of England governor Mark Carney enlightened that the world’s economic recovery is entering a new phase and more reforms are needed in the financial sector to prevent another crisis. German Chancellor Angela Merkel insisted that the 17-nation euro zone must give itself a stronger coordination of economic policies to remain competitive and spur growth.

The euro zone’s debt burden rose further in the second quarter despite years of austerity. Eurostat, the EU’s statistics office, raised concern that aid debt across the 17 countries that use the euro rose to 93.4% of the euro zone’s annual gross domestic product from 92.3% the previous quarter. Though countries across the region, such as Greece and Spain, have made great strides in reducing their borrowing through spending cuts and tax increases, they’re still running budget deficits that add to their stockpile of debt. Spain’s economy grew 0.1% in the third quarter and the latest estimate by the central bank shows the country came out of a two-year long recession in the third quarter of the year.

Manufacturing activity in the euro zone expanded at a slower rate than expected in October. The preliminary manufacturing purchasing managers’ index inched up to a seasonally adjusted 51.3 in October from a final reading of 51.1 in September. The

Report also showed that service sector activity in the euro zone declined to a two-month low in October. The preliminary services purchasing managers’ index fell to a seasonally adjusted 50.9 this month from 52.2 in September, disappointing expectations for an increase to 52.4.

ASIAN MARKET:

Most of the Asian equity indices ended the session in red during the week as investors remained concerned amid uncertainty about the near-term outlook for the markets following the recent uptrend. Back on regional turf, Hong Kong benchmark edged lower by over two and a half percent during the week as the nation’s trade balance fell more-than-expected last month. The Hong Kong Census and Statistics Department stated that Hong Kong Trade Balance fell to a seasonally adjusted -42.0B, from -39.6B in the preceding month.

Moreover, Japanese stock market declined by over three percent during the week with the yen’s rise against the dollar prompting investors to offload their holding in risky assets. Meanwhile, core consumer prices in Japan were up 0.7 percent on year in September. That was in line with forecasts and down from 0.8 percent in August. Overall inflation was up 1.1 percent on year, versus expectations for 0.9 percent, which would have been unchanged from the previous month.

Chinese Shanghai too ended the week’s trade in the red as investors remained concerned over China’s economic outlook that weighed down sentiments. However, losses remained capped as the country’s flash Markit/HSBC Purchasing Managers Index (PMI) stood at 50.9 in October, above September’s final reading of 50.2 and marking a seven-month high. Meanwhile, Japanese Nikkei declined by over half a percent with investors pressing sales, tracking weak cues from Wall Street and on the dollar’s weakness against the yen.

MARKET OUTLOOK FOR THE NEXT WEEK

The market may remain volatile as traders roll over positions in the futures & options (F&O) segment from the near month to November 2013 series which is expiring on next Thursday, 31^st October 2013.Domestic equity markets, snapping three consecutive weeks’ gaining streak, witnessed correction of about a percent in the passing week and concluded below the psychological 20,700 and 6,150 levels respectively, with loss of over quarter of a percent.

The coming week would be very crucial for Indian equity markets since this would set the tone for near term future, as RBI’s quarterly monetary policy review is scheduled to be announced on October 29, amidst expectation that RBI would yet again hike the repo rates by 25 basis points. However, it is also widely expected that India’s apex bank, besides hiking the key policy rate, would further slash MSF rate by 25 bps to 8.75%.

Additionally, lot of volatility could be witnessed for the coming week as lot of traders may adjust position on account of expiry of derivatives contracts on October 31, 2013. Meanwhile, in the ongoing earning season, investors will be eyeing major results including Hindustan Unilever, Maruti Suzuki, NTPC, Ranbaxy Lab, Bharti Airtel, DLF, Grasim, Lupin and Jindal Steel & Power, Sesa Sterlite, Bank of Baroda, IDFC and Dr Reddy's Laboratories, among others.

Since the coming week would also mark the start of the new month, auto and cement stocks too would hog some limelight as they will be reporting their monthly sales number. Further, markets will also be eyeing the HSBC Manufacturing PMI to be released on November 1.

On the global front, the traders besides keeping a track of developments in FOMC’s two-day policy meeting, to be held on October 29 and October 30, 2013, would also eye other few economic data from US, including Industrial Production data on October 28, followed by Producer Price Index, Retail Sales, Jobless Claims and ISM Mfg Index data on November 1.

TECHNICAL LEVELS AND MAJOR EVENTS TO WATCH OUT FOR NEXT WEEK

_{TECHNICAL LEVELS-INDICES-EQ}
_{NIFTY PIVOT POINT}	₆₁₇₁
_{NIFTY SUPPORT}	₆₀₉₀		₆₀₃₅		₅₉₅₄
_{NIFTY RESISTANCE}	₆₂₂₆		₆₃₀₇		₆₃₆₂
_{SENSEX PIVOT POINT}	₂₀₆₉₆
_{SENSEX SUPPORT}	₂₀₆₁₀		₂₀₅₃₆		₂₀₄₅₀
_{SENSEX RESISTANCE}	₂₀₇₇₀		₂₀₈₅₅		₂₀₉₂₉
_{TECHNICAL LEVELS-USD/INR}
_{PIVOT POINT}		_61.56
_{MAJOR WEEKLY SUPPORT}		_61.17		_60.78		_60.39
_{MAJOR WEEKLY RESISTANCE}		_61.95		_62.34		_62.73

_{MAJOR EVENTS FOR NEXT WEEK}
_{28 Oct}	_{IIP DATA IN US}
_{29 Oct}	_{RBI Monetary Policy, FOMC meeting}
_{30 Oct}	_{FOMC meeting 2nd Day}
_{31 Oct}	_{F& O Expiry of Oct Series} _{JOB LESS DATA in US}
_{1st Nov}	_{US RETAIL SALES}

CURRENY UPDATES-WEEKLY-USD/INR

During the week USD against INR opened at 61.40 made a high of 61.94, low of 61.16 and finally closed at 61.55 and thus was range bound movement during the week due to weakness witnessed globally in Dollar Index. For next week Rupee may still remain range bound and show some positive movements by trying to go below 61 marks if FII inflows remain positive alongwith global weakness in Dollar Index and steps to be taken by RBI in next monetary policy on 29^th October 2013.