For updates visit
Nifty hits new highs; more room for upside say experts
Monday, May 21, 2007
The market had an extremely good session inline with its global markets. Nifty created history by closing on anew high. All the Asian indices closed in green. Rally was seen on the back of broad based buying interest.
Except for IT and auto stocks all the BSE sector indices closed in green. Energy, metal, banking, media and FMCG stocks were among the major gainers. Broader markets also participated in the uptrend giving markets an extremely positive breadth and even the turnover was high.
On the results front, SAIL came out with numbers above street expectations pulling other steel stocks higher.
Energy stocks from Reliance stable, Reliance Energy and Reliance were among the top gainers.
The Metal & oil and gas indices have led to this new high and the BSE metal index is up 9% from the February 8 highs. It has; in fact, recovered 29% from the March 16 lows. The BSE oil and gas index is up by 10.5% from the February highs and it has recovered by 24% from the March lows. Moreover, the banking index has recovered by 22.5% from its March lows.
RIL, in the oil and gas sector, is up 17% from the February highs. RPL gas recovered 36% from the March lows. IPCL recovered by 26% from the low.
Though there have been some sectors like the auto, IT and cement stocks that have not performed, the Asian markets' positive sentiment seems to have encougared the Nifty as well.
Dilip Bhat, Prabhudas Lilladher says, “I do not think that India is any exception to what has been happening internationally. But as the index goes into the new territory, one tends to become a lot more cautious, because we have seen that every time it has gone up, it has also given a substantial reaction. The way the rupee is behaving; there is a lot of money inflow happening and to add to that, the real fears of inflation has also been diluted through the RBI - was really the cause of concern and which should have threatened to derail this so called bull moment in the market; those fears also have got diluted. Regarding the 16%-17% Nifty PAT growth, I think perhaps what we will have to see is maybe there could be some reaction but there still seems to be upwards for some more time to come.”
But this growth sentiment, driven by only a few stocks, has a few market professionals concerned.
Jagdish Malkani Member, NSE feels,
"Probably we are on a record-breaking form, but overall, one still doesn’t feel that gung-ho because frankly, the broader markets midcaps are not really participating; when you look around, it’s the same. Earlier 4,245, a whole lot of good quality midcaps which were close to their highs; some are down to 40%, some to 60%-70% of their highs. So this has been a 6-8 stock rally led by Reliance. So it needs to permeate deeper, to give us a raging bull feeling. "
Apart from oil, gas and metal, another sector doing well, has been banking. Over the past few days, the private as well as PSU banks have been faring impressively.
A Balasubramaniam, CIO of Birla Sunlife says "Banking as a space; given the current valuations which are there in the private sector and also the gap between the public sector and private sector; wherever there is some bit of quality play, one looks at the growth rate of these companies vis-à-vis the current market cap. There are areas where one can still find some winner. So effectively, whichever companies have been able to grow at substantially higher rate than some of the large cap companies, and second earnings visibility for next two-three years is reasonably clear - these are some of the companies that we feel that going forward the overall interest would lie.”
moneycontrol.com
Except for IT and auto stocks all the BSE sector indices closed in green. Energy, metal, banking, media and FMCG stocks were among the major gainers. Broader markets also participated in the uptrend giving markets an extremely positive breadth and even the turnover was high.
On the results front, SAIL came out with numbers above street expectations pulling other steel stocks higher.
Energy stocks from Reliance stable, Reliance Energy and Reliance were among the top gainers.
The Metal & oil and gas indices have led to this new high and the BSE metal index is up 9% from the February 8 highs. It has; in fact, recovered 29% from the March 16 lows. The BSE oil and gas index is up by 10.5% from the February highs and it has recovered by 24% from the March lows. Moreover, the banking index has recovered by 22.5% from its March lows.
RIL, in the oil and gas sector, is up 17% from the February highs. RPL gas recovered 36% from the March lows. IPCL recovered by 26% from the low.
Though there have been some sectors like the auto, IT and cement stocks that have not performed, the Asian markets' positive sentiment seems to have encougared the Nifty as well.
Dilip Bhat, Prabhudas Lilladher says, “I do not think that India is any exception to what has been happening internationally. But as the index goes into the new territory, one tends to become a lot more cautious, because we have seen that every time it has gone up, it has also given a substantial reaction. The way the rupee is behaving; there is a lot of money inflow happening and to add to that, the real fears of inflation has also been diluted through the RBI - was really the cause of concern and which should have threatened to derail this so called bull moment in the market; those fears also have got diluted. Regarding the 16%-17% Nifty PAT growth, I think perhaps what we will have to see is maybe there could be some reaction but there still seems to be upwards for some more time to come.”
But this growth sentiment, driven by only a few stocks, has a few market professionals concerned.
Jagdish Malkani Member, NSE feels,
"Probably we are on a record-breaking form, but overall, one still doesn’t feel that gung-ho because frankly, the broader markets midcaps are not really participating; when you look around, it’s the same. Earlier 4,245, a whole lot of good quality midcaps which were close to their highs; some are down to 40%, some to 60%-70% of their highs. So this has been a 6-8 stock rally led by Reliance. So it needs to permeate deeper, to give us a raging bull feeling. "
Apart from oil, gas and metal, another sector doing well, has been banking. Over the past few days, the private as well as PSU banks have been faring impressively.
A Balasubramaniam, CIO of Birla Sunlife says "Banking as a space; given the current valuations which are there in the private sector and also the gap between the public sector and private sector; wherever there is some bit of quality play, one looks at the growth rate of these companies vis-à-vis the current market cap. There are areas where one can still find some winner. So effectively, whichever companies have been able to grow at substantially higher rate than some of the large cap companies, and second earnings visibility for next two-three years is reasonably clear - these are some of the companies that we feel that going forward the overall interest would lie.”
moneycontrol.com
0 comments:
Subscribe to:
Post Comments (Atom)
IMPORTANT DISCLAIMER
Investment in equity shares has its own risks. Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that we consider reliable. I, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and I am not responsible for any loss incurred based upon it.& take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations given in this blog.
