NEW DELHI: The 50-share Nifty index is seen opening lower tracking mixed Asian Markets on Friday and poised for a weekly fall after the Reserve Bank of India (RBI) raises base rate by 25 bps on Thursday.
The RBI raised key policy rates by 25 bps for a 10th time in 15 months bringing its repo rate to 7.50 percent, reverse repo rates to 6.50 per cent in a move to arrest surging inflation in Asia's third largest economy.
Indian markets continued to slide on Thursday after the RBI announced another round of rate hikes.
"Markets have broken a key technical support of 5420 and are likely to head further south most likely to levels closer to 5350", says Kunal Saraogi, CEO, Equityrush. Markets must close above 5460 on Friday for any prospects of a recovery in the next week to come true, he adds.
Traders need to be very circumspect and be wary of buying into stocks in the metals, real estate and auto space that have seen the biggest sell off in the recent fall. FMCG, pharma and textiles continue to afford buying opportunities despite weakness in the broader markets.
At 08:19 AM, Tokyo shares were trading flat, Hong Kong fell 0.48 percent and Shanghai fell 0.10 percent.
US markets ended marginally higher after the Labor Department said new jobless claims fell to 414,000 in the week ending June 11, a decline of four percent from the previous week. Another report said US housing grew more than expected last month.
The Dow Jones industrial average gained 64.25 points, or 0.54 percent, to end at 11,961.52. The Standard & Poor's 500 Index rose 2.22 points, or 0.18 percent, to 1,267.64. But the Nasdaq Composite Index slipped 7.76 points, or 0.29 percent, to close at 2,623.70.
The euro hit a record low against the Swiss franc and slid against the dollar and the yen on rising concerns that Greece's problem were far from resolution. The cost of insuring Greek debt against default hit another record high, a report said.
Stocks to watch:
Maruti Suzuki after the auto major settles 13-day strike at Manesar plant. The plant will start production from Saturday.
Cadila Healthcare after Somaxon Pharma sues company on patent infringement.
NMDC after the company signed a JV with Severstal to set up a 5 mn tn steel plant in Bellary. Both companies will jointly invest close to Rs 9000 crore in steel plant.
Tata Steel after the steel major on Thursday agreed to sell its 26 percent stake in Australia's Riversdale to Rio Tinto for $1.1 billion.
Auto parts maker Amtek Auto Ltd has brought down its debt to about 30 billion rupees after it redeemed $250 million foreign currency convertible bonds.
Pipavav Shipyard after the company managed to get a large order book from defence sector. The company bagged $660 million from India Navy.
Agro Tech Food after the company renewed focus on distribution and low ad spends. The company is moving from trading to a branded food business and is working on emerging niche food categories.
M&M will be in focus as most analysts put the company as a 'SELL' idea in the short term. The stock has fallen nearly 12 per cent year-to-date on back of lower demand and rising interest rates. The company's margins fell to 14.7 pct in FY11 vs 15.9 % in FY10.
Stock ideas from Ashwani Gujral
Jubilant Foods - Verdict: BUY
Target - 860.00
Stop Loss - 790.00
Pantaloon Retail - Verdict: BUY
Target - 338.00
Stop Loss - 280.00
Lovable Lingerie - Verdict: BUY
Target - 450.00
Stop Loss - 395.00
The RBI raised key policy rates by 25 bps for a 10th time in 15 months bringing its repo rate to 7.50 percent, reverse repo rates to 6.50 per cent in a move to arrest surging inflation in Asia's third largest economy.
Indian markets continued to slide on Thursday after the RBI announced another round of rate hikes.
"Markets have broken a key technical support of 5420 and are likely to head further south most likely to levels closer to 5350", says Kunal Saraogi, CEO, Equityrush. Markets must close above 5460 on Friday for any prospects of a recovery in the next week to come true, he adds.
Traders need to be very circumspect and be wary of buying into stocks in the metals, real estate and auto space that have seen the biggest sell off in the recent fall. FMCG, pharma and textiles continue to afford buying opportunities despite weakness in the broader markets.
At 08:19 AM, Tokyo shares were trading flat, Hong Kong fell 0.48 percent and Shanghai fell 0.10 percent.
US markets ended marginally higher after the Labor Department said new jobless claims fell to 414,000 in the week ending June 11, a decline of four percent from the previous week. Another report said US housing grew more than expected last month.
The Dow Jones industrial average gained 64.25 points, or 0.54 percent, to end at 11,961.52. The Standard & Poor's 500 Index rose 2.22 points, or 0.18 percent, to 1,267.64. But the Nasdaq Composite Index slipped 7.76 points, or 0.29 percent, to close at 2,623.70.
The euro hit a record low against the Swiss franc and slid against the dollar and the yen on rising concerns that Greece's problem were far from resolution. The cost of insuring Greek debt against default hit another record high, a report said.
Stocks to watch:
Maruti Suzuki after the auto major settles 13-day strike at Manesar plant. The plant will start production from Saturday.
Cadila Healthcare after Somaxon Pharma sues company on patent infringement.
NMDC after the company signed a JV with Severstal to set up a 5 mn tn steel plant in Bellary. Both companies will jointly invest close to Rs 9000 crore in steel plant.
Tata Steel after the steel major on Thursday agreed to sell its 26 percent stake in Australia's Riversdale to Rio Tinto for $1.1 billion.
Auto parts maker Amtek Auto Ltd has brought down its debt to about 30 billion rupees after it redeemed $250 million foreign currency convertible bonds.
Pipavav Shipyard after the company managed to get a large order book from defence sector. The company bagged $660 million from India Navy.
Agro Tech Food after the company renewed focus on distribution and low ad spends. The company is moving from trading to a branded food business and is working on emerging niche food categories.
M&M will be in focus as most analysts put the company as a 'SELL' idea in the short term. The stock has fallen nearly 12 per cent year-to-date on back of lower demand and rising interest rates. The company's margins fell to 14.7 pct in FY11 vs 15.9 % in FY10.
Stock ideas from Ashwani Gujral
Jubilant Foods - Verdict: BUY
Target - 860.00
Stop Loss - 790.00
Pantaloon Retail - Verdict: BUY
Target - 338.00
Stop Loss - 280.00
Lovable Lingerie - Verdict: BUY
Target - 450.00
Stop Loss - 395.00
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