Daily Report July 31st, 2006 Monday

Nifty (3130) SUPPORT-3108-3082-3035 RESISTANCE-3169-3200-3277 Nifty range 3109-3169 and which side nifty breaks would give a direction markets more towards positive but a huge resistance at 3200 is making weak bulls to exit there longs till 3080 below close is not seen bulls would target higher levels and with Fiis and MF turning net buyers in the month of July short should be careful above 3212 levels on closing basis. TOP 5GAINERS=SBIN-DRREDDY-SAIL-PNB-TATATEA TOP5LOSER=GAIL-NATIONALUM-MTNL-BAJAJAUTO-BHARTIATL. P/E=17.57 p/b=4.27 adv=17 dec=33 NSE adv: 512 dec: 383 -vol-rs.6014crs



Sensex (10680) SUPPORT-10605-10510-10390 RESISTANCE-10799-10900-11050 Sensex should close the gap at 10797 for a fresh up move and 10940 which is a double top should be broken with good volumes with results season almost coming to an end and all negatives factors getting over the trend in markets will be decided in the coming week any down move below 10400 would only trigger fresh correction in markets till then being positive would be safe.

8dma=10389 13dma=10469 21dma=10550 34dma=10334 55dma=10386 OPEN=10787 HIGH=10787 LOW=10603 BSE adv: 1366 dec: 1014 -vol-rs.2789crs

Fiis buyer rs.461crs and Mutual funds buyer rs.262crs on Thursday, Fiis buyer rs.1014crs in July month and buyer rs.12615Crs in 2006, mutual fund buyer rs.39crs in July month. F&O DATA Fiis buy rs.80crs in nifty future and buy rs.108crs in stock future on 28th July and provisional Fiis buy in cash rs.23crs source NSE website



Day That Ended: Weekend consideration and lack of fresh buying ended the markets with profit booking while BANKS gained with SBIN leading the charge. Fiis and MF turning buyers for month of July and reduction in F&O lot size would be factors to be watched going forward. International markets U.S closed positive and Indian ADRs gained against Indian market sentiment ICICIBANK-VSNL-INFY major gainers gaining more than 3% EURO markets closed positive, Crude $73.36.

Outlook for Monday: Results season will come to an end from Monday and that would help to decide the movements in markets as Geo-political tension would end as per indication as many govt face internal pressure to end Middle East crisis created by unwanted Israel aggression. And early indication also point to softening of stand would happen in interest rate hike from FED but too early to comment. Now no major negative news market should give a clear direction the coming week. CENTURYTEX above rs.402 would be a big breakout but watch out for results on Monday. VSNL-HEROHONDA-BHARATFORGE-HINDALCO-IVRCL-IPCL-ORCHIDCHEM would be good buy for the coming week.



Counter view: Stop loss trade does it make sense and how much should be the loss a trade can carry and what reward it gives do traders follow this is always a big debate. Traders play a big role in markets and there are big time revenue to brokers and Govt but they losing money has started to worry many big broking house as lower volumes means lower revenue so now many new method are being adopted to make then earn. I see many calls given where the risk is more than the reward which doesn't make sense for traders and they should immediately reject those kinds of calls are else wait till the stock comes near stop loss to buy. In my view if the reward is 3% and more a risk of 1% would be reasonable but many over the net give calls where risk is higher than the reward and many traders suffer losses due to these kind of calls. And there is a thumb rule which one should follow never go short on a stock and bad news and never go long on a stock based on a good news as the bad or good news is already and almost discounted I would quote SBIN where I saw many sell calls based on the outlook of the results and the stock after touching a low of rs.725 spurted to rs.799. Stop loss is meant to protect u r capital erosion as short trades are done to earn more profits with less capital and holding capacity so basic should be always right and one should know if u can arrest u r losses to bare minimum profits would start to flow.



NEWS:

http://www.capitalmarket.com MTNL's Q1 June 2006 net profit declined 17% to Rs 131 crore (Rs 158 crore). Total income declined 2.3% to Rs 1362 crore from Rs 1395 crore. Hindalco has reported a 85% growth in Q1 June 2006 net profit to Rs 601.50 crore (Rs 324.90 crore. Net sales jumped 93.5% to Rs 4,273.70 crore (Rs 2,207.80 crore) Hindalco is setting up a 3.2 lakh tonne aluminium smelter in Sidhi district, Madhya Pradesh (MP), at an estimated cost of Rs 7,700 crore. Engineers India posted 38.16% fall in net profit to Rs 27.82 crore for the quarter ended 30 June 2006 as compared to Rs 44.99 crore for the quarter ended 30 June 2005. Total income decreased 37.88% to Rs 161.26 crore (Rs 259.58 crore). Steel Authority of India (Sail) reported 23% growth in Q1 June 2006 net profit to Rs 1, 386.41 crore (Rs 1126.48 crore). Total income (net of excise) surged to Rs 7,567.70 crore (Rs 5772.75 crore). The company said sales during the quarter was boosted by sales of Rs 558.17 crore pertaining to earlier periods consequent to the effect of price escalations finalised with a major customer.

http://www.businessstandard.com Asian Paints today reported a 37.73% increase in consolidated net profit at Rs 60.30 crore for the first quarter ended June 30, 2006 when compared with Rs 43.78 crore in Q1FY06. Both the major Wall Street indices finished with sharp gains on Friday as investors expect better Q2 numbers based on inflation numbers released by the commerce department. Indian ADRs, too, largely finished with gains. Infosys zoomed over 3% to $41.61. Satyam, Wipro, VSNL, HDFC Bank and ICICI Bank also closed with gains. Siemens bags addl order for new B'lore airport. Petronet LNG Ltd today reported a 43% increase in net profit at Rs 56.08 crore for the first quarter ended June 30, 2006 when compared with Rs 39.13 crore in Q1FY06.

http://www.financialexpress.com The Government on Friday said 10.3 billion dollars of FDI, including money raised from ADRs and GDRs, flowed into the country country during 2005-06. The Videocon group has bagged a contract for supplying 22,500 of the 30,000 colour television sets that the ruling DMK had promised to give the poor in Tamil Nadu free of cost. This was one of the most attractive promises DMK made before the last Assembly elections.

http://www.thehindubusinessline.com The RBI on Friday said that FIIs have been permitted to offer foreign sovereign securities with AAA rating as collateral to the recognised stock exchanges in India for their transactions in derivatives segment. Dr Reddy's Laboratories Ltd has approved bonus issue of one equity share for every equity share held. Neyveli Lignite Corporation today signed an agreement with the Gujarat Government for setting up a 12-million tonne a year lignite mine and a 1,500 MW power project.

http://economictimes.indiatimes.com Asian Development Bank (ADB) has for the first time agreed to extend up to $300 million loan to state-owned power major NTPC Ltd for its power generation programme without seeking government guarantee. FM okay with cut in petro duty, but warns of fiscal load.



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Disclaimer: trade in stock market is high risk& high return and I do not accept any financial and/or legal responsibility arising the use of the information this is no offer to buy/sell jus my views to share.

: Who is making money in markets?

Who is making money in markets? Many investor and small traders have this question in mind. And everyone knows broker by way of brokerage and Govt by way of taxes and bankers by way of margin funding interest make money for sure. While 95% of the people lose money by way of trading and investor normally come at the peak and sell at bottom jus to lose money with India having bull markets which has lasted almost 3yrs. With so much of information jus at click and more transparency corporate India (we didn’t have quarterly results and guidance before) 13 quarters of amazing growth where is investor getting it wrong. My simple understanding says when markets goes up they feel there is no end it will be moving up and they miss to take profits and buy more on F&O and margin funding markets comes down they feel it is end of everything and there is no tomorrow. Jus think market crashed from 12600-8800 almost 38% how many corporate closed down shop not even one. So investor should understand the dynamics of markets and spend time in knowing the companies they invest I have seen many people taking advice from people who facilitate trade, in my view they are people who have the same knowledge as u have so investor u are the best judge so do u r homework invest in companies which have growth and make u r stock market experience profitable.

Stop loss trade does it make sense

Stop loss trade does it make sense and how much should be the loss a trade can carry and what reward it gives do traders follow this is always a big debate. Traders play a big role in markets and there are big time revenue to brokers and Govt but they losing money has started to worry many big broking house as lower volumes means lower revenue so now many new method are being adopted to make then earn. I see many calls given where the risk is more than the reward which doesn’t make sense for traders and they should immediately reject those kinds of calls are else wait till the stock comes near stop loss to buy. In my view if the reward is 3% and more a risk of 1% would be reasonable but many over the net give calls where risk is higher than the reward and many traders suffer losses due to these kind of calls. There is a thumb rule which one should follow never go short on a stock and bad news and never go long on a stock based on a good news as the bad or good news is already and almost discounted I would quote SBIN where I saw many sell calls based on the outlook of the results and the stock after touching a low of rs.725 spurted to rs.799. Stop loss is meant to protect u r capital erosion as short trades are done to earn more profits with less capital and holding capacity so basic should be always right and one should know if u can arrest u r losses to bare minimum profits would start to flow.

Outlook for Monday

Day That Ended: Weekend consideration and lack of fresh buying ended the markets with profit booking while BANKS gained with SBIN leading the charge. Fiis and MF turning buyers for month of July and reduction in F&O lot size would be factors to be watched going forward. International markets U.S closed positive and Indian ADRs gained against Indian market sentiment ICICIBANK-VSNL-INFY major gainers gaining more than 3% EURO markets closed positive, Crude .36.
Outlook for Monday: Results season will come to an end from Monday and that would help to decide the movements in markets as Geo-political tension would end as per indication as many govt face internal pressure to end Middle East crisis created by unwanted Israel aggression. And early indication also point to softening of stand would happen in interest rate hike from FED but too early to comment. Now no major negative news market should give a clear direction the coming week. CENTURYTEX above rs.402 would be a big breakout but watch out for results on Monday. VSNL-HEROHONDA-BHARATFORGE-HINDALCO-IVRCL-IPCL-ORCHIDCHEM would be good buy for the coming week.