Stock Market Updates For March 11th, 2014

Advertisement

Corporate News/Results Corner

As per media reports, power tariff likely to go up in Delhi, as power regulator works out plan to liquidate past dues – Positive in short term for Tata Power and Reliance Infra

As per media reports, Delhi Electricity Regulatory Commission (DERC) has allowed distribution companies (discoms) to recover dues from the years when retail tariff increase was disallowed – referred to as regulatory assets (RAs). The regulator has worked out a plan to allow the Delhi’s 3 private discoms recovery of dues totaling Rs 80bn over eight years beginning 2014-15. As part of this, the discoms will recover Rs 16.7 bn of RAs from consumers through tariff in the first year. The overall scheme is to liquidate the Rs 114.3 bn of RAs – recognized but unrecovered revenues – as on March 2012. The move will help the discoms raise additional financial resources from banks but also increase consumers’ tariff burden. The annual installments’ allowed to be liquidated are Rs 4.2 bn for BSES Yamuna Pvt Ltd (BYPL), Rs 7.7 bn for BSES RajdhaniPvt Ltd (BRPL) and Rs 4.8 bn for Tata Power Delhi Distribution Ltd (TPDDL). This development is positive in short term for Tata Power and Reliance Infra.

Copper hits 8-month low of less than $7000/tonne – Negative in short term for SesaSterlite and positive for cable companies like Finolex Cables

Fears over the health of China’s financial system are spilling over into the global copper market, where prices tumbled to a seven-month low to below $7000/tonne on Monday. The metal, which is used in products from smartphones to cars, is piling up in warehouses in China as demand from manufacturers slows coupled with problems in China’s financial system.
Much of the copper stored in China, the world’s biggest consumer of the metal, is used by companies and investors as collateral for loans from banks and other lenders. They then invest the money in higher-yielding assets. Some investors are concerned that the recent sharp drop in copper prices could lead to a downward spiral in the market. As prices fall, borrowers could come under pressure to post more collateral, forcing them to sell copper to raise money. Banks could also become less willing to accept copper as collateral. We believe this development to be negative in short term for SesaSterlite and positive for cable companies like Finolex Cables.

Economic and Other News

IIP, CPI data to be released today

The IIP for December is expected to post decline of 0.8% versus a contraction that we saw in the month of November of around 2.1%. CPI will be more critical in terms of a data point and the street is expecting an estimate of 9.1%. This compares to 9.87% on the month-on-month basis. So there is a cool off, which is expected on a month-on-month basis.
World News

China posted $23 bn trade deficit

China posted a $23 billion trade deficit. Exports fell 18.1% in February, surprising analysts that expected a 6.8% rise in exports and a trade surplus of $14.5 billion.

Market Trend
NIFTY – CMP 6537

Synopsis

Nifty opened with a positive bias & traded rangebound withstock specific movement & finally closed 0.2% positive.
Going forward, Till Nifty holds 6510, it can move upto 6578-6590 zone where it will face high resistance. Index RSI isapproaching 75 which is a sign of overbought condition.
If Nifty breaks 6510 support zone, then 6460-6440 would beretested.
Daily as well as Weekly Momentum is in positive indicatingbuying support on all dips.
Bank Nifty – CMP – 12108

Synopsis

Bank Nifty opened with a positive bias & witnessed buying ondips leading the Index to finally close 1.8% positive.
Going forward, till it holds 11,980, it can move upto 12,450zone where it will face high resistance.
If breaks & sustains below 11,980, would fall upto 11700-11750.
Daily as well as Weekly Momentum is in positive indicatingbuying support on all dips.

Related Articles:

StriveBlue Home|Poompugar Shoppings