makin97 NSETIPS @ RAKESH MAKIN: MARKET ENDED 17.05.2011 TUESDAY

WERE TODAY'S NIFTY GAINERS

MARKET ENDED 17.05.2010 TUESDAY

SENSEX 18137.35 -207.68

NIFTY 5438.95 -60.05

NASDAQ 2761.61 -20.70

UPDATEDTIME 09.28 PM 17 MAY 2011

Benchmarks ended with heavy losses as poor quarterly results from State Bank of India, higher subsidy sharing reports on ONGC and concerns of possible delay in drilling of new wells by Reliance Industries in KG-D6 basin led to sharp selling in index heavy-weights.

SBI posted net profit of Rs 20.88 crores for the quarter ended March 31, 2011 where as the same was at Rs 1866.60 crores in the same period a year ago. Total income was at Rs 26536.84 crores as against Rs 22474.12 crores in the same period previous fiscal.

"On the face of it, the provisioning is going higher. Definitely, asset quality has deteriorated and the NPA has also have mounted up. I think this is a cause of concern. And going forward with the kind of provision in savings rate that the RBI has done and given by the virtue of higher CASA ratios they will have to possibly bear the impact of that and compared to Q3, Q4 has been a little bit more on the negative side.

The market had a subdued start due to lack of cues from global peers and slipped lower as profit booking emerged in heavy-weight ONGC. There were media reports that oil&gas major may have to bear higher subsidy burden upto 38.5 per cent of total subsidy. Later weakness in Reliance Industries also put pressure on the benchmarks.

According to reports, Reliance Industries may take around three years to drill new wells in KG-D6 block. This is likely to have negative impact on the output from the fields. In another development, the company has rolled back petrol price by Rs 2.5 per litre. The company had hike petrol prices by Rs 5.25 per litre on Sunday.

State Bank of India is likely to face more correction in coming sessions. He has advised traders to go short on the stock.

"The downside looks limited in Reliance Industries and ONGC while SBI looks weak. SBI can see a correction of 7-8 per cent in next couple of weeks. Traders can go short in the stock at Rs 2430-2460 levels with stop-loss of Rs 2520 for target of Rs 2200-225.

Bombay Stock Exchange's Sensex ended at 18,137.35, down 207.68 points or 1.13 per cent. The 30-share index hit a high of 18435.80 and low of 18084.67 in trade today.

National Stock Exchange's Nifty closed at 5438.95, down 60.05 points or 1.09 per cent. The broader index touched a high of 5523.85 and low of 5421.05 intraday.

The benchmarks have been moving below 200 Daily Exponential Moving Average and are likely to remain weak for the next few sessions.

As of now Nifty is seen heading lower towards 5250-5300 levels. The market is likely to remain rangebound between 5450-5400 and 5250-5300 for next couple of weeks," he added.

BSE Midcap Index was down 0.66 per cent and BSE Smallcap Index moved 0.61 per cent lower

Among the sectoral indices, BSE Oil&gas Index was down 3.23 per cent, BSE Bankex moved 2.24 per cent lower and BSE Auto Index slipped 1.02 per cent. BSE FMCG Index was up 0.53 per cent and BSE IT Index gained 0.15 per cent.

SBI (-8.08%), ONGC (-6.42%), SAIL (-4.60%), GAIL (-4.24%), Hero Honda (-3.48%) and Reliance Industries (-2.76%) were amongst the major Nifty losers.

Jindal Steel (1.94%), Hindustan Unilever (1.53%), Bajaj Auto (1.49%), ITC (0.94%) and HCL Tech (0.87%) were the major gainers.

Market breadth was negative on the NSE with 1739 declines as compared to 1115 advances.