Market Wrap for February 1, 2010 - ALex K Mathews (Head, Research - Geojit BNP Paribas Financial Services Ltd)

The markets had opened in red tracking weakness in the Asian front and very shortly picked up pace to move into the green but couldn?t stay there and moved back into red. In the early afternoon session the markets rebounded once again into green and moved in a range for sometime before making another upsurge and finally it came to a close on a flat note. On the domestic front, India?s exports rose an annual 9.3% in December to $14.6 billion while the imports rose 27.2% to $24.75 billion. India?s manufacturing sector grew the fastest in almost a year and half in January 2010. Also the Purchasing Managers Index rose to 57.7 in January 2010 as against 55.6 in December 2009. Good amount buying was seen from the DII front which had bough shares worth around Rs 12222 crore in January 2010 which was supporting the markets from the major fall. All these domestic cues helped the markets to inch higher. In the second part of the day the strong rebound was seen in Asian markets and the green color in the US index futures markets, on signs of recovery in manufacturing sector around the world, helped our markets to close with Sensex down 0.01% and Nifty up 0.36%.

On the sectoral front we saw buying interest coming in the Consumer Durable up 5.7%, Healthcare up 2.55%, Auto up 1.69% and Metal up 1.6% while FMCG and IT sectors remained weak. We saw buying in oil companies like BPCL, HPCL, IOC etc. Tata Motors and M&M moved up on strong quarterly sales numbers. However banks remained subdued to weak with HDFC Bank, SBI, and PNB etc in red. Midcap stocks like REI Six Ten, Titan, Kalpataru power, Lupin and Smallcap stocks like Zandu pharma, Zenith Infotech, Geodesic, Tata sponge etc attracted buying interest.

Outlook for the market still is not showing any strength even though it is oversold. We may see some value buying in the morning session tomorrow but expect selling pressure at around 4968 levels. Concerns over further monetary tightening in China and more share supply will have a negative impact on Asian markets. The Nifty is having major support at 4799 and 4727 levels.

Source : Equity Bulls

Keywords