Market Summary for the day : 17/07/2014

Indian equity benchmarks ended the choppy day of trade on quiet note with positive bias as investors turned cautious and booked profits at higher levels. Sentiments remained optimistic on report that overseas investors bought Indian shares worth 6.21 billion rupees on July 16, 2014. Some support also came on report that the deficit in monsoon rains is expected to narrow next week as the grain bowl in northwest, oilseed areas of central parts and cotton belt of the western region are set to get higher downpours. The monsoon rains were 15% below average in the past week, against 41% below average rainfall in the previous week. 

However, upside remained capped as investors remained on sidelines ahead of important numbers of IT bellwether Tata Consultancy Services (TCS). The company is likely to report modest decline in net profit on Q-o-Q, weighed down by impact of salary increases and appreciation of rupee. 

Global cues remained sluggish with Asian markets ending mostly in the red on Thursday, giving up earlier modest gains as Chinese shares fell, while the euro probed recent lows against the dollar amid speculation the U.S. Federal Reserve was tilting towards tighter monetary policy. 

Back home, rally in capital goods shares aided the sentiments as stocks like, L&T and BHEL edged higher after Reserve Bank of India (RBI) announced incentives to raise long term bonds for infrastructure financing. Metal pack witnessed heavy buying with Hindalco and Tata Steel followed by Coal India and Sesa Sterlite on the back of positive  Chinese GDP growth data. Power stocks too remained investors’ choice after Delhi Electricity Regulatory Commission (DERC) approved tariff hike of 8.32 percent for all three discoms Reliance ADAG-owned discom BSES Yamuna  Power (BYPL), BSES Rajdhani Power (BRPL), Tata Power Delhi Distribution Company (TPDDL). 

Export oriented stocks too remained on buyers’ radar, as Federation of Indian Exports Organisations (FIEO) has said that export momentum is likely to continue in the coming months on the back of higher demand helped by an uptick in global economies and measures announced in the Union Budget. Additionally, public sector oil marketing companies (OMCs) too edged higher on reports that losses on sale of diesel have fallen by nearly a rupee to Rs 2.49 per litre as international oil rates have moderated. On the flip side, auto pack ran out of steam after Bajaj Auto’s net profit rose marginally 0.31% to Rs 739.98 crore in first quarter ended June 2014 over the corresponding quarter in the previous year. 

The NSE’s 50-share broadly followed index Nifty ended higher by over fifteen points to end above its psychological 7,600 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex edged higher by over ten points to end above the psychological 25,550 mark. The broader markets outperformed benchmarks and ended the session with a gain of around one and a half percent. The market breadth remained in favour of advances, as there were 1,746 shares on the gaining side against 1,188 shares on the losing side while 112 shares remain unchanged. 

Finally, the BSE Sensex added 11.44 points or 0.04%, to 25561.16, while the CNX Nifty gained 16.05 points or 0.21%, to 7,640.45. 

The BSE Sensex touched a high and a low of 25613.03 and 25494.46, respectively. The BSE Mid cap index was up by 1.37%, while Small cap index gained 1.35%. 

The top gainers on the Sensex were Hindalco Inds up by 3.91%, Tata Power up by 3.53%, Tata Steel up by 2.99%, Coal India up by 2.86% and NTPC up by 2.63%. On the flip side, the key losers were Mahindra & Mahindra down by 3.18%, Bajaj Auto down by 2.27%, Gail India down by 0.91%, Maruti Suzuki down by 0.87% and TCS down by 0.84%. 

On the BSE sectoral front, Metal up by 2.46%, Power up by 2.36%, Consumer Durables up by 2.11%, Capital Goods up by 1.16% and PSU up by 0.89% were the top gainers, while Realty down by 0.77%, Oil & Gas down by 0.42%, Auto down by 0.16% and Bankex down by 0.01% were the losers in the space.

Technical Parameters of Nifty

Today, RSI was at 57. MACD Positive below Signal line; India VIX was at 15~. Nifty closed below its short moving averages like 5 DMA (7541) & 20 DMA (7593) but still above its medium term moving average like 50 DMA (7456) & long term MA of 200 DMA (6583) which all indicates that profit booking may continue at higher levels, but long trend remains positive in the medium to long term.