- The Nifty on Monday showed a sharp bounce and closed above the 10,400 level. Whether this is a decisive break above the 10,300 levels will be known in the next few days but it was a mix of short covering and selective buying.
- The combination of higher IIP and lower inflation should aid the market sentimentally. At 7.5% IIP growth with promise of a capital cycle revival, the lower inflation should set the base for higher real growth in GDP.
- FIIs were net buyers to the tune of Rs.375 crores while DFIs sold Rs.(-465) crore on Monday. Surprisingly, the markets were sharply up on Monday despite limited institutional participation. This may raise doubts about its sustainability.
- Asian and European markets on Monday were flat to negative with the trade overhang continuing to spook markets. The SGX Nifty is marginally down and may see some pressure today after the frenetic rise in the indices yesterday.
- We had recommended Bharti Airtel yesterday morning and the stock was up by over 4% yesterday. We suggest holding on for targets of Rs.450-460 and will also suggest picking up Bharti Infratel at current prices.
- We have been reiterating about accumulating Tata Motors at around the Rs.350 levels and with higher JLR numbers expected with a revival in growth, Tata Motors should bottom around these prices. Expect targets of 440-450 on the stock.
- Punjab National Bank, even assuming the write-off in the next year, appears to have bottomed out at around the Rs.90 mark. It offers a good level to accumulate with a time frame of 1 year for targets of 150-160.
- The positive cues from IIP and CPI inflation should keep the traders and institutions interested in the Indian markets for now.
