Lower Opening seen on weak global cues - Consortium

Nifty closed almost flat at 5855 (up 4.45 points) while BSE mid-cap and small cap Index fell over 1%. BSE 200 advance-decline ratio was 1:3 which clearly indicates selling in second-line counters.

There was bloodbath in many speculative stocks on rumors of pledge shares sold and margin calls. Core Education nosedived by 63% (in the BSE F&O list) to close at Rs107 after touching day's high of Rs298. Other stocks that declined include ABG Shipyard (down 20%), Opto Circuit, Welspun Corp (down 18%), Eros Media, PC Jewelers, NCC and DB Realty (all down by 7-16%).

On the other hand, NBFC stocks like LIC Housing, Aditya Birla Nuvo, Bajaj Finance, L&T Finance etc gained on hope of banking licenses after RBI announced new banking licenses norms.

Rail budget will be announced tomorrow and Union Budget on 28th February. There was stock specific action in the market.

Tech stocks witnessed smart rally on account of Rupee depreciation against Dollar. Pharma stocks recorded smart rally after Ranbaxy reported that it was restarting generic Lipitor production. Both Asian and European markets gained by 1-2% amid speculation Japan may appoint a central bank chief who favors stimulus and as investors awaited the results of Italy's parliamentary election.

For the day coming by Indian markets are expected to open lower and below 100 days SMA on weak global cues. For the last couple of days FIIs have been selling heavily in Nifty futures which has pressured the markets. DIIs are also on selling mode on liquidity crunch. Overnight US markets ended down more than 1.5% as investors remained concerned over Italy's election results. Asian markets too in tandem are trading lower.

Yesterday The Nifty opened higher on flattering global cues and went down initially below the previous day's low of 5850 to touch 5825. It rallied sharply intraday to 5878 and late in the day to come down to close nominally up 4 points at 5854.The Nifty has closed a shade above the 100 days SMA. The last three days lows have also been in a narrow range. With the Railway budget today and the Union Budget on Thursday, the Nifty could be subdued before these events. The 5800 level is a very strong support on the downside. The supports sequentially are 5821, 5800. Sentiments will deteriorate further if Nifty falls below 5800 as no near term support lies there. However we see markets cutting losses in second half of trading.

Source : Equity Bulls

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