Game of numbers

Major hurdle for the Nifty lies at 8308 and 8326

The markets mainly remained in negative territory because of broad based selling. Nifty crossed its 200 DMA and the huge sell off by the FIIs added pressure to the markets.

Major weekly indicators are still showing further weakness to continue, in that case Nifty could test 8000-7965 levels. The major hurdle for the Nifty lies at 8308 and 8326.

On the back of higher sales, UPL reported a 22 per cent rise in the consolidated net profit to Rs 440.06 crore for the quarter that ended March 2015. The agro chemicals firm’s net profit for a year ago period stood at Rs 360.28 crore.

Total income of the company for the period under review stood at Rs 3574.97 crore from R 3365.23 crore in the corresponding period last year. During the 2014-15 fiscal, the net profit stood at R 1144.03 crore as compared to Rs 949.79 crore in the previous financial year.

Net profit
Bharti Infratel has posted an 18 per cent increase in its consolidated net profit at R 558 crore for the quarter that ended March 31 as compared to Rs 472 crore in the same period last year. The company’s consolidated revenues stood at Rs 2947 crore for the fourth quarter 2014-15 compared with Rs 2790 crore last year. The company has proposed a final dividend of Rs 6.5 per share in addition to an interim dividend of Rs 4.5 per share earlier. The overseas investors have invested in over $ 2.3 billion in Indian markets taking the total inflows to $ 15.1 (about Rs 93648 crore) billion since the beginning of the year. As per the data available from CDSL, the Foreign Portfolio Investors (FPI) have bought shares worth $ 2.6 billion (Rs 16316 crore) till April 24, while they pulled out $ 261 million (Rs 14673 crore). They have invested a net of $ 3.34 billion in March, $ 3.96 billion in February and $ 5.45 billion in January.

According to the press release from DIPP (Department of Industrial Policy and Promotion), the government has raised the limit of foreign direct investment in pension sector to 49 per cent inline with the FDI cap in the insurance sector. The FDI cap includes foreign investment in the forms of FPI, FII, QFI, FVCI, NRI and DR. As per the rules, no government approval is required till 26 per cent but FIPB nod will be necessary for the investment beyond 26 per cent and up to the cap of 49 per cent.

On the back of increased economic activity, the World Bank had projected India’s GDP to grow 7.5 per cent. The World Bank in its India Development Update report said that the country’s economic growth is expected to rise 7.5 per cent in 2015-16 followed further uptrend of 7.9 per cent in 2016-17 and 8 per cent in 2017-18. But on the other end rating agency Moody’s said that any upgrade for the country will depend on consistent improvement in inflation, fiscal deficit and other economic parameters.

Policy meets
In the beginning, the markets were high as of the strong corporate earnings but the policy meet from the central banks in the US and Japan made the investors to stay with a cautious stand. The other markets around the globe were tracking the footsteps of the US markets.

For the week ahead, HSBC manufacturing and services PMI will be data in the Chinese markets. Also balance of trade and inflation data will be in focus. Bank of Japan’s policy meet and markit services PMI are in the watch out list for the coming week.

On the commodity space, gold is weak and it is likely to test $1168 and having resistance at $1195.

HSBC manufacturing and services PMI will be the major trigger for the domestic markets for this week. In the earnings corner, companies like SKS Micro, Mangalam cements, Century Enka, Tube Investment, Kotak Bank, South Indian Bank, Century Textiles, Dabur, SBT, NIIT Tech, KPR mill, Muthoot fin, ABB, FDC, GE Shipping, Merck, Titan, PNB, Hero Motocorp and Hindustan Unilever are the major ones.

Alex K Mathews is the author of Financial Services And Systems, as well as Option Trading: Bear Market Strategies published by Tata McGraw Hill. He is also the technical and derivatives research head of Geojit BNP Paribas Financial Services Ltd. The author may have a vested interest in investments he has recommended. Feel free to e-mail him at alex@geojit.com. Geojit BNP Paribas has membership in, and is listed on, the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).

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