morning thoughts...

WE WISH YOU ALL A VERY HAPPY , AUSPICIOUS , SAFE DHANTERAS

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Well the astrological change showed its effect and the markets opened up with a gap up , though gave lots of oppurtunities in individual trades.

Technically now we are into a festive week with f/o expiry ahead which will keep the markets volatile with sudden spurts and profit booking.

On the lower side 7800 remains as good supporting zones and 8050 remains as resistance zones for the markets.

The big ticket energy reforms are here now. The diesel prices have been deregulated. And much awaited gas price hike has been formalized. The move is likely to go a long way in improving fiscal health and strengthening the energy sector. No wonder the stock market has cheered the move with stocks in the energy sector leading the gains.

However, not all players will gain from the same. For example, upstream company like ONGC being a major contributor to diesel subsidies and gas producer will benefit from both the moves.
Until now, regulated pricing for diesel had kept competition from private players at bay.

Subsidy politics' has been the hallmark of the UPA government over the past decade. The fuel subsidy alone cost the government and oil producers about Rs 4 trillion during this period, according to oil ministry data, quoted by Livemint. Hence it is only natural that curbing such humungous losses should be the top priority of a government that wants to bring India's deficit under control. The government's latest bold and politically sensitive move to decontrol diesel and raise gas prices has therefore come as a relief to investors. The fall in international crude prices recently, have certainly helped. But the reform move could make a meaningful difference to India's budgetary deficit. The benefits and beneficiaries of this move will be multifold. One, it will encourage private retailers to restart idle fuel pumps. Meanwhile the PSU oil marketing companies will be able to cut down on their losses. More importantly it will attract foreign investment in the energy sector and help India achieve the much needed energy security. State control on fuel pricing has been the reason for failing to attract MNCs like Exxon, Chevron and Royal Dutch Shell to India's oil block auctions since 1999. Since oil exploration is technology and capital intensive, investments by the MNCs could go a long way in securing India's energy requirements. Currently BP Plc, Europe's second biggest oil company and Cairn India are the only two MNCs having presence in India's exploration sector. 

After focusing on resolving issues in the oil & gas space, the government is now seemingly looking at doing the same in the power space; another big ticket sector which has had negative consequences on the economy in general and the banking sector in particular. The power sector has been marred by a variety of problems, with the key ones being fuel supply concerns, payment delays and execution issues. 

Coming to the commodity markets we remain positive on bullions whereas selling pressure is likely to continue in base metals and energy

Yesterday’s calls sent

Gold Mcx – buy at cmp 27277 sl 27225 targets 28450 – booked profits at 28421

Silver Mcx – buy at cmp 38390 sl 38300 targets 38750 – booked profits at 38720

Copper Mcx – sell at cmp 409 sl 410.50 targets 405 – booked profits at 406.50

Natural gas Mcx – sell at cmp 230 sl 231.50 targets 225 – booked profits at 227

Double bumper Hpcl 500 ca – booked profits at 37 – long from 15

Double bumper Bpcl 700 ca – booked profits at 25 – long from 11

Jackpot Torrent power – buy at cmp 143 sl 137 targets 160 – went 159.30

Hexaware – buy at cmp 173 sl 171 targets 180 – went 180.50

Jackpot Option Ongc 400 ca – booked profits at 25 – long from 7