Nifty (5439) has closed positive +72points breaking previous fancy 5477 to make it 5487 till Nifty is not able to close above 5525 on 3-4days closing basis then rising wedge in rising market which could have negative implication could set-in, this market looks weak technically and weakness can be confirmed only below 5350. Breaking below 5350 we can possibly see 5200 & 5070 on the downside. Nifty long term moving average supporting market 200DMA which 5126 and 100DMA is 5238 without close below 5300 for 2-3days major weakness not seen.
Results season is almost coming to an end with results below analyst expectation of 2128 Companies results available sales has increased by 20% while net profit has fallen by 8.7% and this is mainly due to Government policy on Oil subsidy even if we take out the Oil companies Net profit growth is in single digit due over capacity globally where Metals & Capital Goods show margin pressure. Banking and consumer needs stock have given good results now many stocks have reached a level where risk is more than reward. Nifty trading around P/E of 23 while CNX500 P/E=20.97 trailing 12months has priced future growth. Telangana issue already showing on IVRCL, PATELENG & NAGARCONST and now Legislation that passed the U.S. Senate late Thursday would significantly increase fees for skilled-worker visas and US bill to push IT visa costs up by $250m/yr: NASSCOM TCS stock had impact on Friday more reaction can follow. Railway and Agri commodity stock can perform the coming week if market supports.
On June 18, 2005 Ambani brothers divided RELIANCE group and Sensex which was trading below 5000 levels touched 21000 by January 2008 and RELIANCE group stocks outperformed market. Now two brothers have comprised and Sensex almost 18000 levels this group has been underperforming markets and still looks negative.
