Nifty 7929 /Sensex 25765/ Bank Nifty 18446
9 Advances /42 Declines/ 0 Unchanged
“Sensex sinks 389 pts, Nifty ends below 8000 on growth worries”
It was a disappointing start to the week on Monday as equity benchmarks erased all 2016 gains. The BSE Sensex shed 432 points intraday as concerns over economy & earnings growth after demonetisation and consistent outflow of funds on fears of likely Fed rate hike in December policy dented the market sentiment.
The 30-share BSE Sensex closed below the psychological 26000 level, down 385.10 points or 1.47 percent at 25765.14. The index fell for the sixth consecutive session today, the biggest losing streak since March 2015.
Dealers say margin calls triggered after the 50-share NSE Nifty breached the 8000-mark. It plunged 145 points or 1.80 percent to close at 7929.10.
Deutsche Bank expects the remainder of 2016 to be highly uncertain, which will keep markets volatile with a downward bias. It cut December 2016 Sensex target to 25,000 (from 27,000 earlier) as India will not remain immune to the outflow pressure seen across emerging markets, though balance of payments situation has improved sharply since the taper tantrum in May 2013.
Key Results Today
Allcargo
Birla Corp
Indraprastha
IRB Infra
JBF Industries
Larsen
National Stand
Ushdev Intl
Siti Networks
RESULT ANALYSIS & POLL
IMPORTANT RESULT:LARSEN
EXPECTATAION: L&T Q2 net seen down 11%, order inflow disappointment unlikely
Analysis
Engineering and construction major Larsen & Toubro (L&T) is expected to report a 11 percent degrowth in consolidated profit at Rs 890 crore on yearly basis, according to average of estimates of analysts polled by CNBC-TV18. Profit of Rs 996 crore in Q2FY16 was boosted by exceptional gain of Rs 310 crore.
-Revenue during the quarter is seen rising 8 percent year-on-year to Rs 25,253 crore but EBITDA (earnings before interest, tax, depreciation and amortisation) may fall 5 percent to Rs 2,466 crore and margin may shrink by 120 basis points to 9.8 percent.
-Moderate revenue growth may be on back of growth in infra, IT and finance businesses while change in accounting standards may have an impact on margin
-Further losses in its heavy engineering and metallurgy & material handling segment might also lead to EBITDA margin compression.
--Analysts say disappointment on order inflows is unlikely as L&T's announced order inflows stood at Rs 25,000 crore in Q2FY17.
-Key factors to watch out for would be working capital, order inflow, guidance, demonetisation impact and Kattupalli port & other asset moves.
L&T has guided FY17 revenue growth of 12-15 percent, order inflow growth of 15 percent and margin improvement of 50 basis points in FY17.
TECHNICAL LEVELS :Larsen &Turbo
CMP 1348 L&T has immediate support at 1324 and immediate resistance at 1375
Break and sustain below 1324 will make it positionally weak as lower support seen around 1300--1270.Below 1270 Next support at 1245.
Above 1375 if level is positively breached and sustained then next resistance seen around 1300—1424……Next at 1454
OUR RECOMMENDATIONS
Our call to buy Maruti 4900 PE (Option) around 70--68 proved great as it flared and made high of 148 before settling at 126 on closing. We booked full profit around 145--150
[Profit of 12000 on 1 Lot]
Our call to buy DLF 110 PE (Option) around 2.00 proved great as it flared and made high of 4.45 before settling at 3.00 on closing. We booked full profit around 3.55—4.00
[Profit of 10000 on 1 Lot]
Our call to Sell Bank of Baroda (FUT) around 174--175 proved great as it cracked and made low of 159.80 before settling at 161.80 on closing. We booked full profit around 166.
[Profit of 28000 on 1 Lot]
Our call to Sell Nifty (FUT) below 8050 proved great as it cracked and made low of 7921 before settling at 7959 on closing. We booked full profit at 7950.
[Profit of 7500 on 1 Lot]
Now what to expect??
Nifty and Bank Nifty Levels
-Nifty has immediate support at 7930 and resistance is at 8050—8080
A move and sustain below 7930 will take to 7880---7830 and then to 7750 mark. Further downside panic will see only close below 7750 else it could test its resistance level of 8050—8080 again.
On the other hand, Bank Nifty has immediate support 18200. Further downside panic will see only close below 18200 else it could test it's resistance level of 18600---18850 again.
Today's Top Pick
Trade with levels only. More will update during market hours
More will update soon!!
