The Professional Ticker Reader

These are stocks that we expect to out-perform the markets. Cash and derivative strategies are advised thereon. Please stay online to enable loading of graphics from our servers. Please also read the trading tips section at the end of the newsletter.

BHEL - This electrical power major is in a long term uptrend and derives support at it's 30 day SMA as the chart shows. The chart pattern is that of rising tops and bottoms and the stock has a very high relative strength and is therefore a market out-performer. We have previously recommended this scrip vide our newsletter dtd 08/11/03, 27/12/03, 03/01/04 & 07/02/04 Click here to view previous editions We recommend a buy on declines for the discerning investor / trader.

Glaxo - This MNC pharma major was recommended vide our earlier editions dtd 06/12/03, 20/12/03, 10/01/04, 17/01/04, 24/01/04 and 07/02/04 Click here to view previous editions and has more than lived up to our expectations. Having booked profits at the 650 levels last week, the counter is a buy on declines again. This company is quite simply the largest beneficiary of the EMR / product patents regime being ushered in from 2005 onwards. We recommend a buy. The scrip is a strong market out-performer.

Hero Honda - this 2 wheeler major is in a long term uptrend and gets strong support at the 30 day SMA. The stock is riding high on the back of strong sales figures and expanding markets due to the economic upturn. The stock is making new highs with an unfailing frequency and is a buy on declines.

ICICI Bank - This banking major has been a regular feature in our recommendations and has out-performed even our bullish projections. Previous recommendations were made on 02/08/03, 23/08/03, 27/09/03, 04/10/03, 26/10/03, 01/11/03, 08/11/03, 06/12/03, 13/12/03, 27/12/03, 03/01/04, 07/02/04 & 14/02/04. Click here to view previous editions. Being a new-age private sector bank, the growth rate has been superlative and the loan portfolio is far above average. The banks e-enabled thrust and aggressive capturing of the market share has been the main trigger in the bullishness. The recent upgradation by international agencies of the Indian banking system is good news for this company as it can avail of cheaper capital in the overseas markets. The announcement of the mega IPO is the prime cause for the sharp fall in the price due to worries on dividend yields. The strategy is two pronged one - short in the near term and accumulate at lower levels.

Infosys - We have been recommending this counter as a buy since Aug ' 03 ever since the scrip gave a breakout above the 3500 mark, vide our editions dtd 08/11/03, 13/12/03, 20/12/03, 27/12/03, 03/1/04 & 07/02/04 Click here to view previous editions. The software sector is likely to remain under pressure till the elections are not over in the USA. The reasons being the wave of anti - outsourcing sentiments to protect US jobs. Till then, the sector will be an under-performer and sell on advances for savvy traders.

IOC - This petroleum refining / distribution major was recommended earlier vide our editions dated 20/12/03, 24/01/04 & 14/2/04 Click here to view previous editions. The stock is under-going a re-rating and is a buy on advances wherein it clears short term resistance levels.

ITC - this tobacco, FMCG to hotels major has been in an uptrend and is now out-performing the markets strongly. We had recently advocated booking profits at the 1050 levels after an entry at the 1000 mark. The stock is out of the short term congestion zone and is likely to make newer highs in the short term. A buy is recommended.

Maruti - this scrip has been one of the more prolific recommendations and also one of the more profitable ones. The reco dates were 08/11/03, 03/01/04, 24/01/04 and 31/01/04 Click here to view previous editions. The scrip is a strong market out-performer and is in a major uptrend as the chart below indicates. We recommend a buy on declines.

ONGC - This oil & gas PSU major was recommended by us many a times earlier vide our newsletters dtd 20/12/03, 17/01/04 and 24/01/04 Click here to view previous editions. The upcoming IPO is likely to see the routine pre-issue run upwards and we advocate a buy above the congestion level of 780.

Reliance - this counter has been advocated by us as being capable of leading any rally from the front and the performance has been upto the mark. The earlier recommendations were dated 07/06/03, 14/06/03, 21/06/03, 02/08/03, 04/08/03, 23/08/03, 30/08/03, 06/09/03, 20/09/03, 27/09/03, 04/10/03, 11/10/03, 26/10/03, 01/11/03, 08/11/03, 20/12/03, 27/12/03, 03/01/04, 17/01/04, 24/01/04, 07/02/04 & 14/02/04 Click here to view previous editions. The scrip is building a strong base at the 580 mark and is likely to encounter resistance at the 600 mark in the near term. Once the 600 levels are convincingly surpassed, expect a new top in the making. We maintain a buy on the counter.

BSE Sensex - Last week, we predicted that should the Sensex fall below the 5,925 with high volumes, a level of 5,860 was a possibility.The index has closed near that level and below it's short and medium term averages in the bargain. If the sentiments do not pick up, we expect the 5,650 levels to be a reality in the coming fortnight. On the higher side, expect resistance at the 6,000 mark.

Your call of action - Since the Sensex futures are not very liquid, we suggest trading the Nifty 50 instead.

Nifty 50 - last week, we had advocated that the Nifty was expected to rally upto the 1932 levels. Short term support was to be seen at the 1850 levels. The index has closed at these levels and the oscillators are pointing towards a further weakness in the undertone as the short & medium term averages are violated on the downsides. We feel the 1750 levels maybe tested in the coming fortnight if the bulls do not come and extend support to the markets.

Your call of action - We advocate fresh trades on the Nifty on the long side only on declines that too in an indirect fashion by selling puts or buying calls to be on the safer side. Sell the February 1750 puts at a premium of Rs 7 - 8 or above. More aggressive traders can buy the Feb futures at current prices and hedging the position by selling the Feb 2000 calls at a premium of Rs 10 - 12.

Dow Jones Industrial Average - This old economy benchmark index measures the outlook on the New York stock exchange. Last week we had advocated resistance at the 10,750 levels ( click here to view our previous editions ) which proved a major hurdle for the markets. The Dow Jones has retraced from the 10754 mark !!! The index is likely to remain under pressure till it surpasses the 10750 levels with heavy volumes. Expect the 10,500 levels to be a good short term base for this index in the near term.

Dow Jones - Weekly chart

Your call of action - Since Indian investors are not allowed to trade in overseas markets, this is a pure academic study.

Nasdaq - This new economy benchmark index measures the outlook on the Nasdaq exchange. Last week, we forecast that the 2000 levels will be a short term support and the index took support at the 2023 mark ( click here to view our previous editions ). The 2000 levels would remain a good base for this index - which if violated, will take the Nasdaq to 1925 levels. Only above a 2175 close, expect the next resistance at the 2240 - 2250 levels.

Nasdaq - Weekly chart

Your call of action - Since Indian investors are not allowed to trade in overseas markets, this is a pure academic study.

FTSE - This index measures the outlook on the London stock exchange. As we have been forecasting a 4300 level support, this index is making a base in the near term and showing short term weakness ( click here to view our previous editions ). Our outlook though mildly positive for this index is also that of an under-performer as compared to the US markets. The oscillators are pointing towards a sideways market at present levels - only above a conclusive close above 4560 levels, will a new rally start.

FTSE - Weekly chart

Your call of action - Since Indian investors are not allowed to trade in overseas markets, this is a pure academic study.

Trading tips for the week

The put / call ratio is climbing and is currently at the 0.33 : 1 levels and the outstanding positions in the derivatives segment have shown a qualitative deteteoration. The FII investments are continuing steadily.
There is offloading at higher levels in stock futures. That indicates a cautious approach as long positions in individual stocks is being hedged by Nifty shorts.
The current week is crucial for the markets as there are big IPO's and therefore we expect a shift of focus & resources to the primary markets.
The index heavy-weights are showing strength again. This in turn will boost the indices and cause a feel good factor. The only worry is that this upbeat sentiment should continue.
The impeding expiry of the February series will see offloading and higher volatility in the near term.
Trades must be executed in small volumes due to the higher volatility expected. Trade fewer counters and conserve cash for future opportunities.
Standby for fresh recommendations via SMS on a real - time basis.

The author is a Mumbai based investment consultant and invites feedback at Vijay@BSPLindia.com and ( 022 ) 23438482 / 23400345.

SEBI disclosure :- The author has no positions in any securities mentioned above.