- The Nifty drifted lower towards the 10,700 mark on Thursday as the crude oil price crossing $75 decisively put pressure on the Indian markets. Oil companies were the only clear beneficiaries in the market.
- Karnataka goes to polls over the week end and traders may be advised to keep light over the week end. Expect some selling pressure on Friday. The outcome on Tuesday will be seen as a mandate for the current government or otherwise.
- FIIs were net sellers to the tune of Rs.(-365) crores while DFIs bought Rs.901crore on Thursday. Traders need to be cautious that any plunge in the INR below the 68/mark could see FII selling if the RBI does not intervene.
- Markets across the US and Europe have gained on Thursday and the SGX Nifty also indicates a higher start for India. However, ahead of Karnataka elections investors will have to be a tad cautious about being too long on markets.
- With crude oil moving higher upstream oil could again be in favour. We have already recommended buying Oil India and would suggest to traders to add ONGC also at the current market price of Rs.185 for targets of R.220 in 2 months.
- It may be time to start accumulating Ultratech with the Binani deal likely to go in favour of the highest bidder. Ultratech can derive huge benefits of scale from the buy-out and we foresee a price target of Rs.4400 on the stock.
- Our joker in the pack could be Bharti Airtel. With a sharp rebound in its Africa business and the proposed IPO, the company could move towards substantial deleveraging in the coming years. Buy at Rs.410 for targets of Rs.450.
- Global cues are positive but the critical Karnataka elections could be a big overhang over the markets during the next week.
