SENSEX
17236.18 +92.50
NIFTY 5229.00 +29.20
USD/INR 0055.53 +00.29
NASDAQ 2953.23 +07.39
GOLD 29858.00 +70.00
|
UPDATEDTIME 09.28 PM 31 JULY 2012
|
The Sensex staged
a pull-back after a knee-jerk reaction to the Reserve Bank of India's policy
review announcement and closed above 17,200 on the back of short coverings.
The RBI's decision to maintain a status quo on key policy rates had already been factored by the street and thus the downside was capped in today's session, say dealers.
Meanwhile, the RBI reduced the statutory liquidity ratio (SLR) to 23 per cent from 24 per cent earlier to ensure liquidity to productive sectors. The SLR cut will free up to Rs 62,000 crore for the banks to lend.
The central bank has cut the FY13 GDP forecast to 6.5 per cent from 7.3 per cent and raised the FY13 inflation forecast to 7 per cent from 6.5 per cent.
In the current circumstances, lowering policy rates will only aggravate inflationary impulses without necessarily stimulating growth. As the multiple constraints to growth are addressed, the Reserve Bank will stand ready to act appropriately.
The policy was in line with expectations and it is the best that the RBI could have done in the present situation.
"With exception of the SLR cut, the announcements including the extent of revision of growth and inflation are in line with our house view. We expect the inflation to continue to rise till December and don't expect the RBI to cut rates till then.
With the SLR cut, the RBI is trying to avert a sharp deceleration in credit growth in an environment where deposit growth remains anemic and CD ratio is stretched. The SLR cut in the face of large government borrowing programme indicates acceleration of open market operations by the RBI. In all, the policy is the best that could be rolled out in a bad situation.
Reports that P Chidambaram will be the next finance minister also boosted the market sentiment, which is anticipating the government to initiate some reform measures.
Yes, he (P Chidambaram) has been of course a good favourite of the markets. He established his reputation by the dream budget in the 1990s. So the markets will like it.
The RBI's decision to maintain a status quo on key policy rates had already been factored by the street and thus the downside was capped in today's session, say dealers.
Meanwhile, the RBI reduced the statutory liquidity ratio (SLR) to 23 per cent from 24 per cent earlier to ensure liquidity to productive sectors. The SLR cut will free up to Rs 62,000 crore for the banks to lend.
The central bank has cut the FY13 GDP forecast to 6.5 per cent from 7.3 per cent and raised the FY13 inflation forecast to 7 per cent from 6.5 per cent.
In the current circumstances, lowering policy rates will only aggravate inflationary impulses without necessarily stimulating growth. As the multiple constraints to growth are addressed, the Reserve Bank will stand ready to act appropriately.
The policy was in line with expectations and it is the best that the RBI could have done in the present situation.
"With exception of the SLR cut, the announcements including the extent of revision of growth and inflation are in line with our house view. We expect the inflation to continue to rise till December and don't expect the RBI to cut rates till then.
With the SLR cut, the RBI is trying to avert a sharp deceleration in credit growth in an environment where deposit growth remains anemic and CD ratio is stretched. The SLR cut in the face of large government borrowing programme indicates acceleration of open market operations by the RBI. In all, the policy is the best that could be rolled out in a bad situation.
Reports that P Chidambaram will be the next finance minister also boosted the market sentiment, which is anticipating the government to initiate some reform measures.
Yes, he (P Chidambaram) has been of course a good favourite of the markets. He established his reputation by the dream budget in the 1990s. So the markets will like it.
The problems
that India faces cannot be solved by one minister. Essentially it has to be
driven from the top and it needs both the Prime Minister's firm intervention
and the political power behind that to push through things. Until that happens,
while the market may like this on a sentiment basis, eventually if things do
not move then it is back to where we are today.
The 30-share ended at 17,236.18, up 92.50 points or 0.54 per cent. It touched a high of 17,253.67 and a low of 17,004.09 in trade today.
The Nifty closed at 5,229, up 29.20 points or 0.56 per cent. It touched a high of 5,234.55 and a low of 5,154.05 in trade today.
"Nifty has been in a down trend since November 2010 and witnessing a time-wise correction. The range is getting narrower between 5,350 and 4,700. The probability of the range to break on the downside is higher with resistance around 20 monthly moving average, ie 5,326.
The 30-share ended at 17,236.18, up 92.50 points or 0.54 per cent. It touched a high of 17,253.67 and a low of 17,004.09 in trade today.
The Nifty closed at 5,229, up 29.20 points or 0.56 per cent. It touched a high of 5,234.55 and a low of 5,154.05 in trade today.
"Nifty has been in a down trend since November 2010 and witnessing a time-wise correction. The range is getting narrower between 5,350 and 4,700. The probability of the range to break on the downside is higher with resistance around 20 monthly moving average, ie 5,326.
However, if the
index manages to sustain above this average, then the overall bias would change
to positive for higher targets.
The BSE Midcap Index was up 0.58 per cent and the BSE Smallcap Index gained 0.13 per cent. Among the sectoral indices, the BSE Oil & Gas Index moved 1.80 per cent higher, the BSE Realty Index gained 1.17 per cent and the BSE IT Index advanced 0.78 per cent. The BSE Bankex was down 0.28 per cent and the BSE Power Index edged 0.20 per cent lower.
After a sharp correction in rate sensitives, a bounce back is in process. Overall trend remains negative and the strategy should be to sell on rise.
ONGC (3.34%), Sterlite Industries (2.64%), Tata Motors (1.92%), Reliance Industries (1.86%) and Wipro(1.71%) were the major Sensex gainers.
Losers included Bharti Airtel (2.77%), State Bank of India (1.27%), Hero MotoCorp (1.24%), Jindal Steel (1.02%) and Dr Reddy's Laboratories (0.69%).
Market breadth was negative on the BSE with 1252 gainers against 1307 losers.
The BSE Midcap Index was up 0.58 per cent and the BSE Smallcap Index gained 0.13 per cent. Among the sectoral indices, the BSE Oil & Gas Index moved 1.80 per cent higher, the BSE Realty Index gained 1.17 per cent and the BSE IT Index advanced 0.78 per cent. The BSE Bankex was down 0.28 per cent and the BSE Power Index edged 0.20 per cent lower.
After a sharp correction in rate sensitives, a bounce back is in process. Overall trend remains negative and the strategy should be to sell on rise.
ONGC (3.34%), Sterlite Industries (2.64%), Tata Motors (1.92%), Reliance Industries (1.86%) and Wipro(1.71%) were the major Sensex gainers.
Losers included Bharti Airtel (2.77%), State Bank of India (1.27%), Hero MotoCorp (1.24%), Jindal Steel (1.02%) and Dr Reddy's Laboratories (0.69%).
Market breadth was negative on the BSE with 1252 gainers against 1307 losers.
Regards
RAKESH MAKIN
+91, 9041667797(DIRECT),
9915684997
OFF 0172-4657997
PANCHKULA (Haryana).
Email:makin_97@yahoo.com
Group mail id: makin97NSEtips@yahoogroups.co.in
No comments:
Post a Comment