The Professional Ticker Reader TM

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July 03, 2004

Markets recover pre-budget. Sensex gains 114 points.

Higher volumes, positive breadth as bulls attempt comeback.

Weekly statistics

Indices	Open	High	Low	Close	Change
BSE - 30	4784	4895	4772	4870	114.19
BSE - 200	617	640	616	636	22.60
NSE - 50	1488	1547	1488	1537	49.00
Dow  Jones	10283 89	Nasdaq	2007 19	FTSE	4407 87
Advances	7250	Declines	4717	Put / Call trades - 37946 : 86046
FII Investments	Rs  145 Crs July 1		Domestic Funds	Rs  31 Crs July 1

The value of  shares advancing was Rs. 19,072 crores ( previous week Rs 14,378 crs ) and the value of shares declining was Rs. 11,867 crores ( previous week Rs 13,538 crs ). This indicates a broader buying bias. The total traded volume on the BSE was Rs. 9,441 Crores ( previous week Rs 8,373 crs ). The total traded volume on the NSE  was Rs. 21,973 Crores ( previous week Rs 19,781 crs ).

The week saw a turnaround in the sentiments as the bulls tried to regain the lost initiative in the run up to the budget. The traded volumes picked up, the market breadth was positive and the undertone saw an improvement as sentiments perked up. The US fed reserve raised the interest rates by 25 bps, which was along expected lines. The boost to the indices came from the technology, energy and pharmaceutical sectors. The fact that the week was the pre-budget week failed to evoke significant enthusiasm from the players. The Sensex was boosted by ACC, Bajaj Auto, Bharati tele, BHEL, BSES, Cipla, Dr Reddy, Grasim, Gujarat Ambuja Cements, Hero Honda, HPCL, Hindalco, Infosys, ITC, L&T, MTNL, ONGC, Ranbaxy, Reliance Inds, Satyam Computers, SBI, Telco, Tata Power, Tisco and Zee Telefilms. The Sensex  was dragged down by HDFC Bank, HDFC, Hind Lever, ICICI Bank and Wipro. The rupee ended the week at 46.88 levels ( 00.04 ) against  the US $. Overall, the week was in line with our mildly bullish expectations. Click here to view the previous weeks report.

Top I Derivatives guide I Likely triggers I Technicals I Reco's I

The markets are likely to derive significant guidance only after the budget and the pre-budget trade is likely to be range-bound and lack lustre. The week gone by has seen higher traded volumes and positive market breadth, which is a positive indicator. The bulls are likely to attempt pushing values higher in the coming days. The first indication of sustainability will be the percentage of delivery volumes of the entire traded volumes. The week gone by has seen a rally on FII sales, low delivery volumes and poor retail participation, which shows a high degree of operator presence. The oil prices are another factor that will influence international financial markets in the near term. The F&O indicators are showing a rise in open long positions but on lower traded volumes. The technology sector continued to boost the markets as per our forecast last week. Click here to view the previous weeks report. That trend may continue for the coming week also. Of the entire weeks traded volumes, the entire 100 % was transacted on positive market breadth days, which is a sign of optimism in the undertone. The volatility having come down in the markets, authorities have reduced the volatility margins on F&O trades, which has aided sentiments. This fact has been repeatedly pointed out by us in the earlier weekly editions. Please standby for our special pre-budget edition over this weekend.

The overseas markets have been under pressure and are unlikely to exert undue influence on the domestic markets in the near term. Overall, we expect a news driven week ahead.

Top I Derivatives guide I Likely triggers I Technicals I Reco's I

This segment is for paid subscribers only.

Top I Derivatives guide I Likely triggers I Technicals I Reco's I

Have a profitable day.

 

Vijay L Bhambwani

Ceo :- Bsplindia.com

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  the stocks mentioned above.

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