Domestic indices down on profit booking - ZENMoney

Domestic indices opened the day on a gap down note following weak domestic cues as the Reserve Bank of India (RBI) announced a slew of measures to address exchange rate volatility. Also data that foreign institutional investors (FIIs) sold shares worth a net Rs 227.26 crore on Monday, 15 July 2013, further weakened the markets. Though markets pared some of their initial losses by noon session, but continued to trade weak in the afternoon session on the back of selling witnessed in front liners and taking negative cues from European counterparts. Indices ended the day with losses.

On a sectoral front, FMCG is the top gainer of the day followed by Oil&Gas and Tech sectors. Realty sector witnessed heavy selling in the day followed by Banking and Capital Goods sector. Banking stocks dampened as RBI has increased the marginal standing facility (MSF) rate and bank rate each by 200 basis points to 10.25% reduced the amount up to which banks can borrow or lend under its daily liquidity window and declared a sale of government securities via an open market operation. Metals, Consumer Durables, Auto, Health Care, IT and Power are other sectors witnessed selling pressure by the end of the day.

The Indian markets are expected to open sideways with a negative bias mirroring weak global markets and are likely to remain choppy thereafter tracking domestic cues.

On the domestic front, sentiments will continue to remain weak as abysmal economic growth and currency woes keep markets under pressure. Soaring crude prices in the international markets will further affect market sentiments in the near term.

The Government's move to relax foreign direct investment (FDI) norms in 12 sectors including telecom and insurance is likely to cheer markets. Positive sentiments will likely be seen in telecom and insurance stocks.

The market will also be eyeing the ongoing earning season for cues. Big names coming out with their results today re HDFC Bank, Heritage Foods etc. Stock specific action is likely to be witnessed based on their outcome.

Crude prices will continue to get support from rising demand in US and speculations of US crude inventories falling for a third straight week. Any further rise in the crude prices will hurt domestic markets which are already struggling with rupee depreciation.

FIIs continued to take out money from the Indian markets. As per provisional figures they net sold equities worth Rs 357.4 Cr on Tuesday. Further outflow from the FIIs can take the markets to new lows.

For the Nifty 5978, 6000, 6055 are the immediate resistance levels, while 5922, 5888, 5833 are its immediate support levels.

For the Sensex, 19945, 20039, 20280 are the immediate resistance levels, while 19703, 19556, 19315 are its immediate support levels.

Source : Equity Bulls

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