Mixed cues, flat notes

Markets in the previous week ended on a flat note with mixed cues from foreign and domestic front On weekly basis Sensex and Nifty closed up around 1 per cent and 04 per cent respectively The major sectoral gainers were FMCG and IT sector which closed up around 7 per cent and 4 per cent respectively Nifty may test 6185 and 6200 levels whereas strong support lies at 5975 below 5940 and 5925 Stability In order to arrest the volatility in the currency instability the central bank of India raised two interest rates On Monday of last week the Reserve Bank of India RBI decided to raise the Marginal Standing Facility MFS to 200 basis points to 1025 per cent from 825 per cent which sucked R 12000 crore from the system The bank rate was adjusted to 1025 per cent MFS is the rate at which the scheduled banks can borrow funds from RBI on overnight basis and the bank rates refers to the rate at which RBI gives loans to the banks Under the new move the liquidity adjustment facility will be capped at R 75000 crore from Wednesday 17 2013 Shortfall Indiarsquos trade deficit data for the month June narrowed from a seven month high by the slowdown in the gold imports The trade deficit narrowed to 1224 billion from 2014 billion in the month May which was a seven month high The gold and silver imports slowed to 228 per cent on yearly basis at 245 billion in June But on year on year basis imports of gold and silver grew by 228 per cent Imports were seen declined marginally by 037 per cent 36 billion during the month and exports stood at 2379 billion as compared to 249 billion in a year ago period Rise The wholesale inflation for the June rose to 486 per cent as compared to 470 per cent in the previous month which was also 43 month low The rise in the inflation data was due to the sharp prices rise in the primary articles which jumped by 814 per cent in June from 665 per cent in May The prices of the food articles rose by 974 per cent from 825 per cent The core inflation fell to a 42nd month low which was due to the lack of demand in the economy The core inflation data stood at 21 per cent in the month of June as compared to 243 per cent in the previous month However the wholesale inflation data remained in the RBIrsquos comfort zone of 4 to 5 per cent Hopeful In the earnings small cap bank DCB gave out with encouraging numbers The company posted a net profit of Rs 43 crore in the first quarter as compared to Rs 19 crore in the same period last year The net interest margin for the quarter under review stood at 344 per cent as against 318 per cent for the first quarter last year The operating income of the bank also rose to Rs 30584 crore on an annual basis The bankrsquos capital adequacy ratio as per Basel II norms stood at 1389 per cent as the quarter ended 30 June 2013 Global On the international front the US markets rose to their ever high on the comments from Federal Reserve FED Chairman The FED chairman in his twice yearly monetary policy report to the Congress said that the central bank is committed to support the economy and revamping of the stimulus plan will only happen after achieving its goals Forecast The major data to watch for on the global front include US continuing jobless claims Durable goods order Markit manufacturing PMI Nonfarm Payroll data balance of trade and new home sales data Also ECB interest rate decision will be another trigger for the markets In Japan GDP and Industrial data will be in focusu00a0 Gold is sideways and may breach 1300 level in the near term It has immediate support at 1272 and 1263 Powerful movements can be seen if gold breaches 1300 mark next week Investors can buy TCS Bank of Baroda PNB HUL and ITC call options ahead of expiry 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 email him at alexgeojitcom Geojit BNP Paribas has membership in and is listed on the National Stock Exchange NSE and the Bombay Stock Exchange BSE Disclaimer No financial information whatsoever published anywhere in this newspaper should be construed as an offer to buy or sell securities or as advice to do so in any way whatsoever All matter published here is for educational and information purposes only and under no circumstances should be used for actual trading or making investment decisions Readers must consult a qualified financial advisor prior to making any actual investment or trading decisions based on information published here Any reader taking decisions based on any information published here does so entirely at his or her risku00a0