India Morning Report: Markets advancing to 5850, fall back to 5750 likely

Bharat Heavy Electricals Limited
Bharat Heavy Electricals Limited (Photo credit: Wikipedia)


Markets will spend another tentative week after a comeback on Friday as traders measure the accetaed  guidemarks at 5850 while Central Banks announce their proclivity to shoot the recovery down in mid flight because of the anemic recovery not established. Liquidity cutback from the Fed have finally settled down as a n expected event in Asia, Ramesh Damani coming out to point out the fundamental investments in Aviation, Media and Retail while pointing out constrained liquidity and again the Rupee making up for the negatively correlated positive moves of the market in the last two weeks with a oil led sell down as 58 seems to have found favor as a new level in the market for the transition to more stable levels for the rupee


Titan would lead the shorts into the green while outstanding 35% + shorts on ICICI Bank and Axis Bank will perhaps strain their credibility again despite monthly statistics lending heart to the shorts in question as the Banknifty not only remains bound for 12250 but the shorts on ICICI Bank will have to recede pretty fast without a score as pre results news and information asserts private sector supremacy again and ICICI being a significant lender is again paired with HDFC Bank in a twople to lead another growth phase expectation in the second half of the year and any such bullish rognostication shoots up interest in Axis Bank netting of shorts in a hurry


Shorts on L&T and BHEL do make sense for us and probably another trip trade from 210-185 on DLF and HDIL correspondingly as happened earlier though in the same cycle at end of May series ( same cycle with Rupee) Again the analysis of Corporate contributions to external debt that resume from here in the public domain will find that the 58 level will have considerably reduced the risk of loss and if in fact Rupee trundles down to 62 because of the  economic Data continuing at all time lows in the positive territory, it would probably b because foo flares in the oil trends as Oil prices strengthen chances of a global recovery


The Dollar would trend down from after Wednesday meetings likely if the US Trsy yield continue their upward march but Monday has let in a whiff of cheer for the Yen to allow the pre FOMC strength in the Dollar to ven the JGB yield – Yen equation again. ut the Rupee is trying to make sure it has practically removed all hope of recovering beyond 57 in this week even if it shoots back technically to 56.50-57.0 levels and starts the new technical recovery from there when warranted (unlikely)








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