Index Trends And Stocks In Action For February 19, 2014

Indian Equity markets after opening on a cautious and slightly listless note; it surged higher in second half of trading session and managed to close above 6100 with gains of more than 50 points. Banking stocks were the star performers in the session, with the proposal to provide Rs 11,200 crore for capital infusion in public sector banks triggering heavy buying that space. Capital goods stocks were in demand as well followed by power stocks and non banking financial firms. In our last write up we mentioned if Nifty gets past 6085 we may see a rally up to levels of 6120 and beyond.

On daily charts Nifty has formed a bullish candlestick and has managed to close above its 21-day EMA which suggest that the short term is shifting in favor of bulls. However it would be interesting to see whether it’s followed up by some more aggressive buying on the next day or not. If we manage to hold on to 6080  on downside and the Nifty gets past 6150 in next couple of trading session than we will march to levels of 6240-6280 in short term. For day trading Nifty has resistance around levels of 6150 and next resistance is around 6180. On downside Nifty has strong support around 6080 and next support is around 6040.

Power Grid Corporation (BSE Code: 532898) plans to invest more than Rs 61000 crore in the next three financial years, with a significant chunk of funds to be raised by way of bonds and debentures. Out of the total amount, Rs 37,641 crore would be raised through bonds/debentures while Rs 7,770 crore would be through multilateral funding/ECB/supplier's credit, Power Minister Jyotiraditya Scindia has informed the Rajya Sabha. The stock may remain in focus in today’s session.

Promoters of Muthoot Finance (BSE Code: 533398) may dilute their stake once their application for bank licence is cleared by the Reserve Bank of India. The management expect some decision on the licence issue by the end of February from the RBI and accordingly the company will approach SEBI for necessary approvals. The stock may remain in action in today’s trade.

Havells India (BSE Code: 517354) has set its eyes on export market as Chinese fans have started getting more expensive, thereby giving an opportunity for Indian makers to pump their products in the international markets. Pegged at approx Rs 5000 crore, India’s fan industry may get a boost with opportunities emerging in the Middle-East (ME) and neighbouring nations including Sri Lanka, Bangladesh and Nepal. The stock may remain in limelight in today’s trade.

ONGC Videsh, the wholly owned subsidiary and overseas arm of Oil and Natural Gas Corporation (BSE Code: 500312) and its partner Oil India (BSE Code: 533106) have signed contracts to explore for oil and gas in two areas in Bangladeshi waters. An equal joint venture of OVL and OIL signed production sharing contracts (PSC) for shallow water blocks SS-04 and SS-09 in Bangladesh. Both the stocks may remain in focus in today’s trade.