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Market Report

Thursday, 01-Aug-2013

NSE

  • The Sensex, which remained under pressure this week on a weakening rupee and RBI projecting low economic growth, declined 28.51 points, or -0.15 per cent to 19,317.19 today. The gauge has now lost 986 points in seven sessions. The wide-based National Stock Exchange index Nifty lost 14.15 points, or -0.25 per cent to close at 5,727.85 today, after climbing to 5,808.50 in early trade as jittery investors offloaded their positions in realty, PSU, oil&gas and metal shares, amid subdued manufacturing trend.

  • On the back of overnight positive newsflow related to US GDP and Fed's bond-buying, the Sensex hit a high of 19,569.20 but could not sustain momentum as selling picked pace. Brokers said selling pressure gathered further momentum on a HSBC survey showing that India's manufacturing sector activity managed to remain fractionally above the crucial 50 mark in July as new business orders slowed.

  • Meanwhile, the stock of Financial Technologies was seen down by almost 65 per cent, wiping out over 64% of investors wealth. The stock was hammered after suspension of all contracts except "e-series" by the National Spot Exchange Ltd, in which it has majority stake, raised concerns about liquidity crunch and settlement defaults at the exchange. Shares of MCX crashed 20 per cent to hit new 52-week low of 512.05.

  • The RBI intervened in the foreign exchange market today to stop the rupee's slide toward a record low as its defence of the currency, built around draining cash from money markets, came under rising pressure. The rupee was down 43 paise at Rs 60.83 against the US dollar. With the Reserve Bank of India struggling to hold the line, investors are skeptical whether the government will take swift, credible action to reduce a gaping current account deficit despite Finance Minister P. Chidambaram's assurances.

  • Goldman Sachs also downgraded India to 'underweight' and said it is looking for clearer growth signs to turn constructive, amid recent recent activity data being sluggish.

  • Globally, Japan's Nikkei share average jumped 2.5% today, marking its biggest one-day gain in three weeks, as investors zoomed in on better-than-expected Chinese manufacturing data. Stocks in Europe were trading with marginal gains.

  • Expect range of 5680-5850 in next few days, says Mitesh Thacker. Market has done a leg of decline and we are getting into consolidation so this may not be the most rewarding trading few days ahead. Once we start trading below and start breaking below 5680, that could be a time when we will see the declining trend accelerate, he says.

  • Market has strong support of 5650-5700, says Ashwani Gujral. This kind of fluctuation can continue for the next five to six sessions till this consolidation is over, and the moving averages have caught up. The market seems to be dealing with a lot of capex heavy stocks. It is a bad idea to try and go bottom fishing at any price in all of these stocks, he warns.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)