Focus more on trading specific stocks

Enthused by the absence of negative factors in the 2022 Union budget and a policy of continuity of the 2021 Union budget with growth initiatives and support from global signals; markets broke a two-week losing streak to post gains of almost 2.5% in the week ended February 4, 2022. The BSE Sensex jumped 1,444.59 points to 58,644.82 , and the NSE Nifty jumped 414.35 points to 17,516.30. Moving in tandem with the benchmarks, the broader markets also joined the rally. The Nifty Midcap 100 and Smallcap 100 indices rose 2.14% and 1.87% respectively. Reflecting global markets and keeping an eye on global signals such as geopolitical tensions between Russia and Ukraine and high oil prices, markets witnessed volatile swings.

With the Union budget maintaining policy continuity, fiscal stability and consistency in the strategic direction of the economy, almost all sectors participated in the fiscal rally, metals, pharmaceuticals, commodities consumer goods, with IT and banking being the main gainers up 3-6.6 percent. There might be thematic changes that could be seen from now on. Therefore, it is advisable to focus more on the stock-specific front rather than broader indices. The coming week would also be crucial as the RBI revises its policy, especially against the backdrop of oil prices surging above $90 a barrel and central banks around the world waging a war on inflation with rate hikes. rate.

Although the Cryptocurrencies Bill has not been passed by Parliament so far, cryptocurrencies will finally be taxed in India. In its budget speech, FM said the transfer of digital assets – and these include cryptocurrencies and non-fungible tokens – will incur a 30% tax. In addition, all transfers of these assets will incur a 1% withholding tax (TDS).

Even the donation of such assets will incur the 30% tax. The short-term direction of the markets will be dictated by the outcome of the RBI policy meeting, national macroeconomic data, global stock market trends, the movement of the rupee against the dollar and international crude oil prices. FIIs have been relentless sellers of Indian equities for the fifth straight month now, limiting the market’s upside. In fact, since October 2021, FIIs have net sold Rs 1.46 lakh crore. It is pertinent to note that despite continued FII selling, the market has been hovering in the 1,500-2,000 point range on the Nifty since October 2021. As the earnings season is in full swing, as many as 1,625 companies will report their quarterly results. this week. The main ones to watch would be Bharti Airtel, ACC, Bosch, Power Grid Corporation of India, Hero Motocorp, Hindalco, Mahindra & Mahindra, Divi Labs and ONGC.

Market Thoughts: Investments are not tested in turbulent markets; they are investors. Individual investors should ignore the futile efforts of commentators and strategists to extrapolate the latest market moves into a prediction of what will happen next. Instead, use recent volatility to make an honest reassessment of the type of investor you are and the level of risk you can bear. If you’ve been glued to TV or financial websites, obsessed with the sight of falling arrows and blushing charts, then this year’s short-term turbulence has already revealed something about yourself that has a enormous long-term importance: you probably have too many things to do actions.

Whether you reduce your stocks or not, the more frequently you check the evolution of your portfolio, the more volatile it will be. Try turning off your phone, moving it to another room, removing trading apps from your home screen, all to build positive habits and improve your investing hygiene. On the other hand, if you can control it, fear is “the best fertilizer for future bull markets”. Stock market panics are essential market hygiene, the natural way in which overvalued assets realign, making future returns more attractive.

F&O / sector watch

Despite making spirited profits at higher levels during the latter part of the week ended, the derivatives segment saw rapid trading. In the options segment, peak interest for call options was seen at 17,800 strikes, followed by 18,500 and 18,000 strikes; and Maximum open interest for the put at 17,500 strikes, followed by 17,000, 17,400 and 17,200 strikes. The concentration of call options is much higher than the Put for the week ahead, suggesting limited upside.

Options data indicates that 17,200 could be crucial support while 17,800 could be a major hurdle for the Nifty in the coming trading sessions. Bank Nifty continued to outperform the Nifty and ended the week with gains of over 2.5%. Avoid aggressive shorts and use this consolidation phase to pick good stocks with strong relative strength. Sector outperformance will continue.

The banking, financial services, oil and gas, infrastructure and automotive sectors are expected to show resilience over the coming weeks. Guidelines issued last month by IRDAI indicate that insurance companies can offer six types of bonds, namely prepayment bond, bid bond, contract bond, customs and court bond, proper performance and the retention of guarantee. Equity futures look good ITC, IDFC First Bank, Sun Pharma, Maruti, Torrent Power, United Breweries and Voltas. Stock futures look weak Atul, ICICI Prudential, Jubilant Foods, M&M Financials, Shriram Transport and Ultratech Cement.

(The author is a stock market expert. He is the former vice chairman of the AP planning board)

Choice of actions

Container Corporation of India Limited (CONCOR), a PSU company is an undisputed market leader with the largest network of 60 ICD/CFS in India (58 terminals and 3 strategic approximations). In addition to providing inland rail transportation for containers, it has also expanded to cover port management, air cargo complexes, and cold chain establishment. It has played and will continue to play the role of promoting containerization in India through its modern rail car fleet, user-friendly business practices and widely used information technology. The company has developed multimodal logistics support for India’s international and domestic containerization and trade.

The Company’s EXIM and Domestic divisions are engaged in handling, transportation and warehousing business. Its international services include rail services, road services, air cargo movements, refrigerated services and bulk booking on a round trip basis. Its domestic services include rail services, volume discount system, door delivery/pickup and terminal handling charges. Its E-Filing software is a web-based application for Exim sites operating at CONCOR’s Terminal/Inland Container Depot. Thanks to its software, any importer/exporter/commissioner can archive its documents, including invoicing and take printouts. Use the dips to buy at the target price of Rs1100.

TANFAC Industries Limited offers aluminum fluoride, AHF acid and sulfuric acid, as well as specialty chemicals. The Company operates through Fluro-Chemicals segment in India. Its product line includes boron trifluoride complexes, dilute hydrofluoric acid, isobutylacetophenone, acetic acid, peracetic acid, oleum, gymsum (anhydride), potassium, potassium fluoride and sodium silicofluoride. Anupam Rasayan India Ltd, one of India’s leading contract synthesis and specialty chemicals players, announced the acquisition of 24.96% of the total stake and joint control of Tanfac Industries Limited (TIL) from Birla Group Holdings Private Limited (BGH), ( a promoter

company which is part of the Aditya Birla Group) and some other groups of TIL promoters (sellers) and the launch of an open offer under the Securities Exchange Board of India Regulations 2011 (Substantial Acquisition of Shares and control) to acquire another 26 per 100 of TIL’s public stockholders. TIL recorded revenue of Rs253 crore, EBITDA of Rs65 crore and PAT of Rs46 crore through the third quarter of FY2022. The deal is proceeding at a P/E multiple of 13 times given the PAT of four quarters behind. Buy for an open offer target price of Rs1,100 in the medium term.

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