Market Outlook 30-09-2009

Markets opened on a buoyant note after a long weekend. Nifty traded above 5000 for the whole day. Numbers of stocks were in bullish mode but as a pack Oil and Gas outperformed strongly. ONGC led the pack as it rose more than 3% to close just below 1200. Other major moves were seen in GSPL, MRPL, Chennai Petro and Petronet. Amongst others gainers were ISCA, Sun Pharma, Patni, Educomp, Cipla, EKC, Mphasis, Yes Bank, TCS, Kotak and GTL Infra. Certain stocks continued to dip on profit taking and this list includes Patel Engg, Union Bank, Ranbaxy, JSPL, Unitech and BPCL. Breadth was marginally positive while volumes were on the lower side. Nifty closed above 5000 but failed to take out 5035-5040 during the day. Strong upward momentum is likely once Nifty begins to trade above 5040. Oil and Gas stocks are beginning to show some momentum and this momentum is likely to pick up in coming days. RIL has seen a lot of consolidation in past 3 months and both RIL and ONGC have generally under performed in the current leg of up move from 4600 onwards. This could correct in coming days and strong upside is likely in both if they begin to trade above 2230 and 1225 respectively. GAIL could target 385-390 in coming days. The lesser names within the sector are looking much more promising. GSPL and MRPL could add another 12-15% in coming days. Amongst others more upside is likely in Colgate( above 639), ICSA, EKC, MLL, Kotak, Tata Chem and HUL. Nifty has immediate support around 4950-60 and then around 4910 while it could target 5120-25 above 5030.