BEST BUY

PUNJ LLOYD (BUY) 280 (Target1) 285 ( Target 2) 289 (Sl) 274

DLF (BUY) 583 (Target1) 591 ( Target 2) 596 (Sl) 572

CINEMAX (BUY) 140 (Target1) 143 ( Target 2) 157 (Sl) 135


Buy Andhrabank with sl 82.50 target 86.70---88.60

Asianelec with sl 918 target 950--980

sell Adaninet near 352 with sl 357 target 337--327

Start selling IFCI near 65-66.60 target 61--58

Expect a relief rally

A relief rally or a technical bounceback is expected tomorrow if global cues are not extremely bearish. The expectation is based on a technical development that has place on Monday.

Though the index saw a huge slide on opening, the lows made in the first 15 minutes were not tested during the day. The Nifty also posted a new intra-day high of 4355, making the intra-day trend-day bullish. This, according to Kamalesh Langote, director VFMDirect.com, indicates that the markets may open on a firm note.

Trading volumes were marginally up from Friday’s level while the advance-decline ratio strongly favoured bears. Immediate support is seen at 4,300 levels while strong resistance is seen at 4,404 levels. The 50-day moving average (Nifty 4,348) and 20 day-swing (Nifty 4,340) are placed nearby.

The 13-week moving average is at 4,310. This indicates there may not be a major pullback in the near future. The put/call ratio of the Nifty open interest moved down to 1.36 from 1.42 as 12.82 lakh open interest was added in call options against 7.65 lakh in put options.

The support and resistance on the basis of the Nifty put/call ratio is at 4,400 as the open interest is evenly placed at 4,400 levels. The support is seen at 4,300 levels as 15 per cent of the total put open interest is seen at 4,300 levels.

The intra-day volatility saw the players squaring there positions during the last hour of trading. If the markets open with a strong upward gap, the mid-day profit booking will pull down early gains. On Monday, the short covering was seen at lower levels, which pulled the Nifty above the psychological levels.

According to analysts, we are into a strong bear market if Nifty sustains below 4321-26 for two days. Below it, Nifty will be clearly in a mid-term bear phase. Investors have to be cautious as a heavy selloff is not ruled out.

Hindalco, TPC join hands for coal block

The AV Birla flagship Hindalco Industries and Tata Power Company (TPC) will jointly develop a coal block in Jharkhand that will feed both the companies’ upcoming power projects in the state.

According to sources close to the state government, the two companies will form a joint venture to develop the mines. “Hindalco will hold 70% of the venture, with TPC holding the rest,” said a senior state government official. The Jharkhand government had recently allotted the mines to the two companies.

The development, according to industry observers, is another instance of two corporate houses coming together to meet raw material needs at a time when demand is fast outstripping the supply. At present, Hindalco and Essar Power, through their JV firm Mahan Coal Company, are developing coal mines at the Mahan block of Sidhi-Singrauli fields in Madhya Pradesh.

Hindalco chairman Kumar Mangalam Birla made a mention of the Jharkhand project in his last week’s address at the company’s annual general meeting. Company spokesperson declined to give further details. A TPC spokesperson confirmed the allocation of the coal mines.

Shares of TPC were down 3.5% on the BSE at Rs 670 on Monday. Hindalco’s stock was down 3% at Rs 157.4. The Sensex had gone down by 1.55% on Monday. The mines allotted to Hindalco and TPC are located in Palamau, near Latehar, where the Birla company is setting up its greenfield project that includes a 350,000 tonne per annum aluminium smelter.

The company is also setting up a captive power plant of 750 mw, which will be fed from the coal mines. According to industry standards, the investment is estimated to be close to Rs 2,400 crore. The company has also filed an application for environmental clearance, water, construction, power and other necessary infrastructure for the project.

TPC is at present setting up a Rs 3,800-crore power project of 1,000 mw in the state under the Maithon Power joint venture it had signed with Damodar Valley Corporation in 2005.

According to company officials, the project already has a coal-linkage and the new allocation at Palamau will be used for a yet-to-be announced project in the state. In 2005, TPC had signed an agreement with the Jharkhand government to set up facilities to generate upto 3,000 mw over an unspecified time period.

Jharkhand has coal deposits of about 70 billion tonnes, 30% of the country’s total reserves of the mineral. Most of the reserves in the state is thermal coal, used in power generation. Coking coal is used in making steel.

The state government has signed memorandum of understanding with about 25 companies to set up plants to generate as much as 31,000 mw of power. The players include Arcelor-Mittal and the Jindal Group

[07.08.07] Market Forecast

The Dow syndrome worked perfectly with the india market today. Eventhough the market opened and fell sharply, it receovered in the late trade to minimise the losses for the day. The dow is now trading in green and we can see a relief rally tomorrow. If anybody is stuck badly in scrips, use this dead cat bounce as an oppurtunity to exit safely. I still advise all not to go long before the market closes above 4533. till then do intraday trade only

Tomorrow, market may open flat or positive with gap up of 30-40 points attached with high volatility and remain long only above 4340 with SL 4325 for a tgt of 4410-4454. If it remains below 4335 keep short with SL 4355 for tgt 4270-4245. Dont carry overnight positions till the nifty closes above 4533.. Till then,trade Intraday only....Mint Money..