Sunday, February 07, 2016

NIFTY INTRADAY VIEW ( 08 / 02 / 2016 )

NIFTY INTRADAY LEVELNIFTY PROBABLE HIGHNIFTY PROBABLE LOW
R47597BULL76207284
R37551UP BREAKOUT75537351
R27535UP CAUTIONLEVEL FOR LONGLEVEL FOR SHORT
R17524SELL74607374
PIVOT7465 LAST DAYSTRONG BULL LOW VOLATALITY
S17454BUYOPEN7418
S27443DOWN CAUTIONHIGH7503.0
S37427DOWN BREAK OUTLOW7407.0
S47381BEARCLOSE7489.1
NIFTY MONTHLY LEVELNIFTY DAILY VOLATALITY1.3%
R26082LONGNIFTY WEEKLY VOLATALITY3.4%
R15976SHORT EXITNIFTY WEEKLY HIGH7600.0
S15765LONG EXITNIFTY WEEKLY LOW7350.0
S25659SHORTNIFTY DAY MEAN7475

BANK NIFTY INTRADAY VIEW ( 08 / 02 / 2016 )

BANKNIFTY INTRADAY LEVEL BANKNIFTY PROBABLE HIGHBANKNIFTY PROBABLE LOW
R415527BULL 1549514595
R315368UP BREAKOUT 1531514775
R215311UP CAUTION LEVEL FOR LONGLEVEL FOR SHORT
R115273SELL 1504614810
PIVOT15081  LAST DAYSTRONG BULL
S115051BUY OPEN14928
S215014DOWN CAUTION HIGH15212.0
S314956DOWN BREAK OUT LOW14891.0
S414798BEAR CLOSE15162.05

BANKNIFTY


The Banking Sector Index

 BANKNIFTY DAILY VOLATALITY2.16%
 BANKNIFTY WEEKLY VOLATALITY5.45%
 BANKNIFTY WEEKLY HIGH15566.0
 BANKNIFTY WEEKLY LOW14761.0
 BANKNIFTY DAY MEAN15163.5

THE WEEK AHEAD

Last batch of Q3 results, Q3 GDP data to dictate near term trend

Macroeconomic data, Q3 results of India Inc., trend in global markets, investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs), the movement of rupee against the dollar and crude oil price movement will dictate trend on the bourses in the near term.

On macro front, the government will announce data on gross domestic product (GDP) for Q3 December 2015 on Monday, 8 February 2016. GDP rose 7.4% in Q2 September 2015. Data on industrial production for December 2015 will be announced by the government after market hours on Friday, 12 February 2016. Industrial Production declined 3.2% in November 2015 over a year ago period.

The government will also announce after market hours on Friday, 12 February 2016, data on inflation based on the consumer price index (CPI) for January 2016. CPI inflation inched up to 5.61% in December 2015 from 5.41% in November 2015.

The results season of India Inc. is drawing to a close by next week. Among quarterly results of prominent companies scheduled for release next week, Dr Reddy's Laboratories, Hindalco Industries, Punjab National Bank, and GAIL (India) will announce Q3 results on Tuesday, 9 February 2016. ACC and Ambuja Cements will announce their Q4 results on Wednesday, 10 February 2016. Cipla also announces Q3 results on Wednesday, 10 February 2015. Coal India, State Bank of India, ONGC, Hero MotoCorp, Tata Motors, and Bharat Heavy Electricals will announce their Q3 results on Thursday, 11 February 2016. NMDC, Sun Pharmaceutical Industries, Mahindra & Mahindra (M&M) and BPCL will announce Q3 results on Friday, 12 February 2016. Adani Ports and Special Economic Zone will announce Q3 results on Saturday, 13 February 2016.

On global front, Chinese stock markets remain closed next week for the Lunar New Year holiday. In the US, Federal Reserve Chairwoman Janet Yellen presents semi-annual monetary report to House Financial Services Committee, in Washington on Wednesday, 10 February 2016 and to Senate Banking Committee on Thursday, 11 February 2016.

THE WEEK THAT WAS

Market drifts lower on weak global stocks


Key indices edged lower as weakness in global stocks affected sentiment on the domestic bourses. Nevertheless, the market recouped some losses in last two sessions of the week, tracking recovery in global stocks triggered by reduced expectations for further interest rate increases from the US Federal Reserve in this calendar year. Key indices fell in three out of five sessions in the week ended Friday, 5 February 2016. Meanwhile, the Reserve Bank of India kept its benchmark interest rate viz. the repo rate unchanged at 6.75% after a scheduled monetary policy review on 2 February 2016.

The barometer index, the S&P BSE Sensex, declined 253.72 points or 1.02% to settle at 24,616.97. The 50-unit Nifty 50 index dropped 74.45 points or 0.98% at 7,489.10. The BSE Mid-Cap index shed 0.78%. The decline for this index was lower in percentage terms than the Sensex's decline. The BSE Small-Cap index lost 2.76%. The decline for this index was higher in percentage terms than the Sensex's decline.

Trading for the week started on a weak note. After swinging between positive and negative zone alternately in intraday trade, the key benchmark indices registered small losses on Monday, 1 February 2016. The Sensex fell 45.86 points or 0.18% to settle at 24,824.83, its lowest closing level since 28 January 2016.

Stocks of metal and mining companies, oil sector firms and public sector companies led losses for key benchmark indices on Tuesday, 2 February 2016. The Sensex lost 285.83 points or 1.15% to settle at 24,539, its lowest closing level since 28 January 2016.

Metal, power and oil sector stocks led losses as key benchmark indices edged lower for the third day in a row on Wednesday, 3 February 2016. The Sensex lost 315.68 points or 1.29% to settle at 24,247.21, its lowest closing level since 21 January 2016.
Stocks of metal and mining firms, oil exploration and production companies and index heavyweight Infosys led gains for key benchmark indices on Thursday, 4 February 2016, in what was a choppy trading session on Thursday, 4 February 2016. The Sensex rose 115.11 points or 0.48% to settle at 24,338.43, its highest closing level since 2 February 2016.

Trading for the week ended on a positive note, as key equity benchmark indices registered strong gains on Friday, 5 February 2016, on firmness in global stocks. The Sensex rose 278.54 points or 1.14% to settle at 24,616.97.

From the 30-share Sensex pack, 15 stocks fell and the rest rose in the week ended Friday, 5 February 2016.

NTPC slumped 12.31%. The stock was the biggest loser from the Sensex pack.
Tata Steel dropped 6.42%. The company reported consolidated net loss of Rs 2127 crore in Q3 December 2015 compared with net profit of Rs 157 crore in Q3 December 2014. Turnover fell 16.63% to Rs 28039 crore in Q3 December 2015 over Q3 December 2014. Earnings before interest, taxation, depreciation and amortization (EBITDA) excluding one-offs and profit on sale of investments declined 69.96% to Rs 838 crore in Q3 December 2015 over Q3 December 2014. The result was announced on 4 February 2016.

GAIL (India) dropped 6.91%. GAIL (India) on 5 February 2016 announced that Prime Minister Narendra Modi on 5 February 2016, dedicated to the nation the Brahmaputra Cracker and Polymer (BCPL) petrochemical complex in Assam. BCPL is a central public sector enterprise under the Government of India (GoI), with GAIL (India) as the main promoter having 70% equity participation. The rest 30% is equally shared by Oil India, Numaligarh Refinery (NRL) and the state government of Assam. Set up with an investment of about Rs 10000 crore, the BCPL plant will have the capacity to manufacture 2.80 lakh tonnes per annum of polymer products which will result in the growth of new downstream plastic processing industries in the North Eastern region, besides reducing dependency on polymer supply from other parts of the country, GAIL (India) said in a statement.

Lupin jumped 5.33%. The stock was the second biggest gainer from the Sensex pack. Lupin's consolidated net profit rose 29.6% to Rs 529.80 crore on 7.1% growth in revenue from operations (net) to Rs 3555.80 crore in Q3 December 2015 over Q2 September 2015. Operating profit surged 30.5% at Rs 877.20 crore in Q3 December 2015 over Q2 September 2015. The operating profit margin (OPM) edged up to 24.66% in Q3 December 2015 from 20.23% in Q2 September 2015.

Among other pharma stocks, Sun Pharmaceutical Industries (down 1.86%) and Cipla (down 2.69%) declined. Dr Reddy's Laboratories rose 0.18%.

Bharat Heavy Electricals (Bhel) dropped 4.36%. The company announced that President of Sudan Omer Hassan Ahmed El-Basheer inaugurated the 500 megawatts (MW) Kosti Thermal Power plant built by the company. This is the largest thermal power plant in Sudan. Bhel had executed this 500 MW project comprising of 4 units of 125 MW each, on engineering, procurement and construction (EPC) basis, having designed, manufactured, supplied and installed the complete power project including associated civil works. The announcement was made on 5 February 2016.

L&T gained 3.4%. The company's consolidated net profit rose 19% to Rs 1035 crore on 8.4% growth in gross revenue to Rs 26058 crore in Q3 December 2015 over Q3 December 2014. The result was announced after market hours on Friday, 29 January 2016. The bottom line was boosted by a sharp surge in non-operational income or the so called other income. The other income jumped 90.8% to Rs 451.68 crore in Q3 December 2015 over Q3 December 2014.

Most bank stocks declined. Axis Bank (down 2.27%), ICICI Bank (down 9.08%) and State Bank of India (down 6.53%) declined. HDFC Bank rose 0.71%.

Auto stocks were mixed. Tata Motors rose 0.16%. Jaguar Land Rover (JLR) North America on 3 February 2016, said its US sales rose 7% to 7,007 units in January 2016 over January 2015. JLR is the British luxury car unit of Tata Motors. Separately, Tata Motors on 1 February 2016 said total sales of Tata Motors passenger and commercial vehicles rose 10% at 47,034 vehicles in January 2016 over January 2015.

Hero MotoCorp rose 0.6%. The company said on 1 February 2016 its two-wheeler sales rose 0.89% at 5.63 lakh units in January 2016 over January 2015.

Maruti Suzuki India (MSIL) slumped 9.13%. The stock was the second biggest loser from the Sensex pack. MSIL on 4 February 2016 unveiled Concept Ignis and Concept Baleno RS on the second day of Delhi Auto Expo 2016. Concept Ignis is a smart compact urban concept vehicle built on a new-generation platform. Concept Baleno RS is a sporty version of premium hatchback Baleno. Ignis and Baleno RS will be launched in India in the festival season,

Separately, MSIL reported 2.6% decline in its total sales to 1.13 lakh units in January 2016 over January 2015.

Bajaj Auto rose 0.66%. Bajaj Auto's net profit rose 4.67% to Rs 901.49 crore on 0.21% growth in total income to Rs 5764.58 crore in Q3 December 2015 over Q3 December 2014. The result was announced on 4 February 2016.

Mahindra & Mahindra (M&M) declined 0.88%. The company on 4 February 2016 announced the launch of its new heavy commercial truck series under the BLAZO brand at the Auto Expo at Greater NOIDA. The BLAZO series of heavy commercial vehicles include multi-axle trucks, tippers and tractor trailers in the range of 25 to 49 ton GVW for the domestic market.

Bharti Airtel jumped 6.01%. The stock was the biggest gainer from the Sensex pack.
TCS rose 1.45%. The company announced on 3 February 2016 that Investec India, a part of wealth management giant Investec, has gone live on TCS BaNCS to power its front and back office operations in India.

Index heavyweight and IT major Infosys advanced 0.87%.

Meanwhile, the Reserve Bank of India kept its benchmark interest rate viz. the repo rate unchanged at 6.75% after a scheduled monetary policy review on 2 February 2016. The RBI kept the cash reserve ratio (CRR) unchanged at 4% of net demand and time liability (NDTL). While retaining accommodative stance of the monetary policy, RBI Governor Raghuram Rajan said in a statement that structural reforms in the Union Budget 2016-17 that boost growth while controlling spending will create more space for monetary policy to support growth. With unfavourable base effects on the ebb and benign prices of fruits and vegetables and crude oil, the January 2016 consumer price inflation target of 6% should be met, the RBI said. Consumer price inflation stood at 5.61% in December 2015.

Going forward, under the assumption of a normal monsoon and the current level of international crude oil prices and exchange rates, inflation is expected to be inertial and be around 5% by the end of fiscal 2016-17, RBI said. However, the implementation of the VII Central Pay Commission award, which has not been factored into these projections, will impart upward momentum to this trajectory for a period of one to two years, the RBI said.

Meanwhile, the outcome of a monthly survey showed on 1 February 2016 that India's manufacturing sector returned to expansion mode in January 2016 as the industry recovered following the contraction seen at the end of calendar year 2015. Alongside a resumption of output at some firms impacted by December's flooding in Tamil Nadu, manufacturers also benefited from rising inflows of new business from domestic and export clients. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers' Index (PMI) rose to 51.1 in January 2016 from 49.1 in December 2015. A reading above 50 indicates expansion while one below points to contraction.

The outcome of a monthly survey on 3 February 2016 showed that growth in India's services sector accelerated last month. The seasonally adjusted Nikkei India services purchasing managers' index (PMI) hit a 19-month high at 54.3 in January 2016. The Services PMI rose from December's reading of 53.6. Amid forecasts of further improvements in demand and favourable government policies, service providers in India expect output to continue to increase over the course of the next year. Additionally, the degree of optimism registered in January was the most pronounced in six months, Markit Economics said.

THE END SESSION ( 05 / 02 )

Trading for the week ends on positive note


Positive lead from Asian markets aided the upmove on the domestic bourses, with key benchmark indices moving higher for the second day in a row. The barometer index, the S&P BSE Sensex, rose 278.54 points or 1.14% to settle at 24,616.97. The 50-unit Nifty 50 index rose 85.10 points or 1.15% to settle at 7,489.10. The two key benchmark indices extended gains after seeing a bout of volatility in late trade. Stocks of public sector banks, metal and mining firms and pharma companies led the rally for key benchmark indices. All the nineteen sectoral indices on BSE logged gains.

In overseas stock markets, Asian and European stocks edged higher amid reduced expectations for further interest rate increases from the US Federal Reserve in this calendar year.

Lupin jumped after the company reported strong financial performance on sequential basis in Q3 December 2015. Steel sector stocks surge on media reports the government may set minimum import price (MIP) on steel imports. Mahindra & Mahindra (M&M) rose after the company announced the launch of its new heavy commercial truck series under the BLAZO brand at the Auto Expo at Greater NOIDA.
The Sensex jumped 278.54 points or 1.14% to settle at 24,616.97, its highest closing level since 1 February 2016. The index rose 334.47 points or 1.37% at the day's high of 24,672.90. The index rose 7.36 points or 0.03% at the day's low of 24,345.79.
The Nifty rose 85.10 points or 1.15% to settle at 7,489.10, its highest closing level since 1 February 2016. The index rose 99.15 points or 1.33% at the day's high of 7,503.15. The index rose 2.65 points or 0.03% at the day's low of 7,406.65.

The BSE Mid-Cap index rose 1.9%. The BSE Small-Cap index rose 1.21%. Both these indices outperformed the Sensex.

The market breadth indicating the overall health of the market was strong. On BSE, 1,620 shares rose and 1,016 shares declined. A total of 135 shares were unchanged.
All the nineteen sectoral indices on BSE logged gains. The S&P BSE Basic Materials index (up 1.99%), the BSE Finance index (up 1.87%), the BSE Healthcare index (up 3.37%), the BSE Bankex index (up 2.11%), the BSE Metal index (up 3.37%), the BSE Telecom index (up 1.6%) and the S&P BSE Auto index (up 1.6%) outperformed the Sensex. The S&P BSE FMCG index (up 0.95%) and the BSE Realty index (up 1.03%) underperformed the Sensex.

Bank stocks edged higher on renewed buying. Among public sector banks, Canara Bank (up 6.04%), Union Bank of India (up 5.62%), Bank of India (up 4.88%), Punjab National Bank (up 4.07%), Bank of Baroda (up 3.21%) and State Bank of India (up 3.16%) gained.

Among private sector banks, Axis Bank (up 4.4%), ICICI Bank (up 2.52%), Kotak Mahindra Bank (up 2.45%), Yes Bank (up 2.3%) and HDFC Bank (up 0.58%) edged higher. IndusInd Bank (down 0.11%) declined.

Pharma stocks gained. Cadila Healthcare (up 4.74%), Strides Shasun (up 4.57%), Cipla (up 3.58%), Dr Reddy's Laboratories (up 3.38%), Aurobindo Pharma (up 2.94%), Sun Pharmaceutical Industries (up 2.91%), GlaxoSmithkline Pharmceuticals (up 2.38%), Wockhardt (up 2.36%), Glenmark Pharmaceuticals (up 1.51%) and Divi's Laboratories (up 1.43%) edged higher. Ipca Laboratories (down 2.02%) and Alkem Laboratories (down 0.52%) edged lower.

Lupin jumped after the company reported strong financial performance on sequential basis in Q3 December 2015. The stock jumped 9.04% at Rs 1,801.45. Lupin's consolidated net profit rose 29.6% to Rs 529.80 crore on 7.1% growth in revenue from operations (net) to Rs 3555.80 crore in Q3 December 2015 over Q2 September 2015. Operating profit surged 30.5% at Rs 877.20 crore in Q3 December 2015 over Q2 September 2015. The operating profit margin (OPM) edged up to 24.66% in Q3 December 2015 from 20.23% in Q2 September 2015.

Consolidated net profit fell 11.9% to Rs 529.80 crore on 11.9% growth in revenue from operations (net) to Rs 3555.80 crore in Q3 December 2015 over Q3 December 2014. Operating profit fell 0.7% to Rs 877.20 crore in Q3 December 2015 over Q3 December 2014. The OPM fell sharply to 24.66% in Q3 December 2015 from 27.78% in Q3 December 2014. The result was announced during market hours today, 5 February 2016.

Nilesh Gupta, Managing Director of Lupin said that the quarter saw a significant pick up in approvals as well as product launches with the company clocking in good growth in the US, India and Japan. The company would continue its investments in research as well as its manufacturing operations and this will drive long-term growth, Gupta said.

Shares of public sector oil marketing companies (PSU OMCs) gained. HPCL (up 1.98%), BPCL (up 1.56%) and Indian Oil Corporation (up 1.35%) edged higher.
Shares of oil exploration and production (E&P) firms declined. ONGC (down 0.07%) and Reliance Industries (down 0.17%) declined. Cairn India (up 3.83%) edged higher.
In the global commodities markets, Brent for April settlement was currently up 16 cents at $34.62 a barrel. The contract had declined 58 cents or 1.65% to settle at $34.46 a barrel during previous trading session.

GAIL (India) fell 3.62% at Rs 341.75. The stock hit a high of Rs 354.60 and a low of Rs 338.50 in intraday trade. Oil India fell 0.12% at Rs 341.50. The stock hit a high of Rs 347.95 and a low of Rs 338.05 in intraday trade. GAIL (India) during market hours today, 5 February 2016, announced that Prime Minister Narendra Modi today, 5 February 2016, dedicated to the nation the Brahmaputra Cracker and Polymer (BCPL) petrochemical complex in Assam. BCPL is a central public sector enterprise under the Government of India (GoI), with GAIL (India) as the main promoter having 70% equity participation. The rest 30% is equally shared by Oil India, Numaligarh Refinery (NRL) and the state government of Assam. Set up with an investment of about Rs 10000 crore, the BCPL plant will have the capacity to manufacture 2.80 lakh tonnes per annum of polymer products which will result in the growth of new downstream plastic processing industries in the North Eastern region, besides reducing dependency on polymer supply from other parts of the country, GAIL (India) said in a statement.

Bosch edged lower after announcing third quarter results. The stock fell fell 4.97% at Rs 16,133.20. The stock was volatile. The stock hit a high of Rs 17,646 and a low of Rs 16,005 in intraday trade. The company's net profit rose 99.12% to Rs 220.77 crore on 12.7% growth in total income to Rs 2786.08 crore in Q3 December 2015 over Q3 December 2014. The result was announced during market hours today, 5 February 2016.

Bosch's board of directors at its meeting held today, 5 February 2016, approved in principle the transfer by way of sale, of the Starter Motors and Generators business of the company (SG-IN) to a subsidiary of Robert Bosch Starter Motors Generators Holding GmbH. The board approved the sale of SG-IN business as a going concern on a slump sale basis for a consideration of Rs 486.2 crore. In case the global SG transaction gets executed within the next 18 months and results in a higher implicit price for SG-IN, there will be an additional contingent consideration payable to Bosch, the company said.

Steel sector stocks edged higher on media reports the government may set minimum import price (MIP) on steel imports. Jindal Steel & Power (up 10.44%), Steel Authority of India (up 6.1%) and JSW Steel (up 2.83%) edged higher. The government has been considering MIP on steel in order to protect domestic steel manufacturers from cheap imports from China, according to reports.

Tata Steel shrugged off dismal Q3 December 2015 results. The stock rose 3.47% at Rs 234. The stock hit a high of Rs 239.10 and a low of Rs 215 in intraday trade. The company reported consolidated net loss of Rs 2127 crore in Q3 December 2015 compared with net profit of Rs 157 crore in Q3 December 2014. Turnover fell 16.63% to Rs 28039 crore in Q3 December 2015 over Q3 December 2014. Earnings before interest, taxation, depreciation and amortization (EBITDA) excluding one-offs and profit on sale of investments declined 69.96% to Rs 838 crore in Q3 December 2015 over Q3 December 2014. The result was announced after market hours yesterday, 4 February 2016.

T V Narendran, Managing Director of Tata Steel India and South East Asia said that steel markets in India have been affected by depressed international steel prices and predatory imports. The quarter saw a sharp decline in steel prices which has impacted the margins, Narendran said. Koushik Chatterjee, Group Executive Director (Finance and Corporate), Tata Steel said that the current business conditions for the global steel industry are extremely challenging with confluence of elevated imports across regions, currency headwinds and depressed market sentiments affecting Tata Steel Group's profitability. The Tata Steel Group has embarked on significant cost rationalisation program including fixed cost reduction, right sizing of manpower, productivity management and enriching the product mix across all geographies, Chatterjee said. These programs are expected to enhance the sustainable profitability profile of the company, he added. The company has also undertaken significant portfolio restructuring and will continue to pursue the same in the future, Chatterjee said.

Among other metal stocks, Vedanta (up 9%), Hindalco Industries (up 3.93%), NMDC (up 4.32%), Hindustan Zinc (up 4.28%), National Aluminium Company (up 2.71%) and Hindustan Copper (up 1.96%) gained.

Mahindra & Mahindra (M&M) rose after the company yesterday, 4 February 2016, announced the launch of its new heavy commercial truck series under the BLAZO brand at the Auto Expo at Greater NOIDA. The stock rose 1.73% at Rs 1,221.90. The BLAZO series of heavy commercial vehicles include multi-axle trucks, tippers and tractor trailers in the range of 25 to 49 ton GVW for the domestic market.


The Sensex and the Nifty rose for second straight session. The Sensex has gained 393.65 points or 1.62% in the preceding two trading sessions from its close of 24,223.32 on 3 February 2016. The Sensex has fallen 253.72 points or 1.02% in this month so far (till 5 February 2016). The Sensex has fallen 1,500.57 points or 5.74% in calendar year 2016 so far (till 5 February 2016). The Sensex is up 777.21 points or 3.26% from a 52-week low of 23,839.76 hit on 20 January 2016. The Sensex is off 5,407.77 points or 18.01% from a record high of 30,024.74 hit on 4 March 2015.

Wednesday, February 03, 2016

NIFTY INTRADAY VIEW ( 04 / 02 )

NIFTY INTRADAY LEVELNIFTY PROBABLE HIGHNIFTY PROBABLE LOW
R47475BULL76137225
R37427UP BREAKOUT75357303
R27409UP CAUTIONLEVEL FOR LONGLEVEL FOR SHORT
R17398SELL75327440
PIVOT7389 LAST DAYSTRONG BEAR LOW VOLATALITY
S17326BUYOPEN7392
S27314DOWN CAUTIONHIGH7419.0
S37297DOWN BREAK OUTLOW7350.0
S47249BEARCLOSE7361.8
NIFTY MONTHLY LEVELNIFTY DAILY VOLATALITY0.94%
R26082LONGNIFTY WEEKLY VOLATALITY3.4%
R15976SHORT EXITNIFTY WEEKLY HIGH7600.0
S15765LONG EXITNIFTY WEEKLY LOW7350.0
S25659SHORTNIFTY DAY MEAN7475

THE END SESSION ( 03 / 02 )

Market sees broad based decline on weak global cues


Metal, power and oil sector stocks led losses as key benchmark indices edged lower for the third day in a row. The barometer index, the S&P BSE Sensex, lost 315.68 points or 1.29% to settle at 24,247.21. The 50-unit Nifty 50 index lost 93.75 points or 1.26% to settle at 7,361.80. The Sensex and Nifty, both, hit their lowest closing level in almost two weeks. Weakness in global stocks hit sentiment on the domestic bourses adversely. All the nineteen sectoral indices on BSE ended in negative zone.

The Sensex and the Nifty traded in negative zone throughout the trading session after opening with a downward gap. After seeing range bound movement in negative zone until the first half of the trading session, the two benchmark indices losses witnessed intraday volatility later. The two benchmark indices extended losses in late trade.

The broad market depicted weakness. More than three stocks fell against each stock that rose on BSE. 2,084 shares declined and 578 shares rose. A total of 98 shares were unchanged. Quite a few stocks constituting the broad based BSE Small-Cap index registered losses exceeding 3%. The BSE Small-Cap index shed 2.25%. The BSE Mid-Cap index dropped 1.3%. The losses for both these indices were higher in percentage terms than those for the Sensex.

Stocks from steel, aluminium and cement sector edged lower after the Cabinet Committee on Economic Affairs (CCEA) approved auction based coal linkage for non-regulated sectors. Crompton Greaves slumped a staggering 21.72% in a single trading session after the company reported reversed turnaround in Q3 December 2015. Shares of oil exploration and production (E&P) firms edged lower after sharp decline in crude oil prices overnight.

The Sensex lost 315.68 points or 1.29% to settle at 24,247.21, its lowest closing level since 21 January 2016. The index lost 351.46 points or 1.43% at the day's low of 24,187.54. The index lost 129.74 points or 0.52% at the day's high of 24,409.26.

The Nifty lost 93.75 points or 1.26% to settle at 7,361.80, its lowest closing level since 21 January 2016. The index lost 105.25 points or 1.41% at the day's low of 7,350.30. The index lost 36.15 points or 0.48% at the day's high of 7,419.40.

The total turnover on BSE amounted to Rs 2698 crore, lower than turnover of Rs 2937.85 crore registered during the previous trading session.

All the nineteen sectoral indices on BSE ended in negative zone. The S&P BSE Utilities index (down 2.59%), the S&P BSE Power index (down 4.16%), the S&P BSE Auto index (down 1.62%), the S&P BSE Capital Goods index (down 2.79%). the S&P BSE Finance index (down 1.44%), the S&P BSE Bankex (down 1.63%), the S&P BSE Oil & Gas index (down 1.58%), the S&P BSE Realty index (down 2.63%), the S&P BSE Basic Materials index (down 2.14%), the S&P BSE Metal index (down 2.03%), the S&P BSE Industrials index (down 2.69%), the S&P BSE Energy index (down 1.71%), the S&P BSE Consumer Discretionary Goods & Services index (down 1.35%), and the S&P BSE Telecom index (down 2.05%) underperformed the Sensex. The S&P BSE Healthcare index (down 0.75%), the S&P BSE Teck index (down 1.25%), the S&P BSE IT index (down 1.17%), and the S&P BSE FMCG index (down 0.3%) outperformed the Sensex.

In overseas stock markets, European stocks edged lower, tracking losses for Asian stocks and overnight sharp slide in the US equities. Shares in Japan and Hong Kong led most markets across Asia lower amid ongoing volatility in the oil market and concerns that global growth is slowing. In Japan, the Nikkei Stock Average ended 3.15% lower. In Hong Kong, the Hang Seng index ended 2.34% lower. US stocks closed sharply lower yesterday, 2 February 2016, as investors unloaded energy and financial stocks amid a selloff in crude-oil futures.

Shares of power generation and distribution companies declined. JSW Energy (down 6.54%), Reliance Power (down 6.65%), GMR Infrastructure (down 5.35%), Adani Power (down 4.03%), NTPC (down 3.46%), NHPC (down 3.63%), Jaiprakash Power Ventures (down 2.91%), Reliance Infrastructure (down 3.58%), Tata Power Company (down 3.22%) and CESC (down 0.88%) edged lower. Torrent Power (up 0.43%) edged higher.
Shares of Power Grid Corporation of India were off 1.27% at Rs 144.20. The stock hit a high of Rs 146.20 and a low of Rs 141.45 in intraday trade.

Shares of power finance companies also declined. Power Finance Corporation (down 2.84%) and Rural Electrification Corporation (down 3.63%) edged lower.

Stocks from steel, aluminium and cement sector edged lower after the Cabinet Committee on Economic Affairs (CCEA) today, 3 February 2016, approved auction based coal linkage for non-regulated sectors viz. cement, steel, sponge iron, aluminium, and others excluding fertilizer (urea) sector. Among steel stocks, Jindal Steel & Power (down 7.32%), JSW Steel (down 3.4%), Tata Steel (down 3.91%) and Steel Authority of India (down 1.52%) edged lower. Among aluminium makers, Hindalco Industries (down 2.7%) and National Aluminium Company (down 2.34%) edged lower.

Among other metal stocks, Vedanta (down 4.85%), NMDC (down 1.9%) and Hindustan Zinc (down 0.45%) edged lower.

Among cement stocks, Ambuja Cements (down 2.39%), Shree Cement (down 2.41%), ACC (down 1.68%) and UltraTech Cement (down 2.07%) edged lower.

Grasim Industries was off 0.58%. Grasim has exposure to cement sector through its holding in UltraTech Cement.

For non-regulated sectors, there will be no renewal of existing fuel supply agreements (FSAs) for coal linkage which are maturing in 2015-16 onwards after completion of their current agreement tenure. However, there will not be premature termination of exiting FSAs. The auction based coal linkage framework attempts to make the coal available in a fair manner to the end-users. To start with, in the first tranche, the quantities corresponding to FSAs of non-regulated sector maturing in 2015-16 onwards and 25% of incremental Coal India/Singareni Collieries Company production during 2015-16 (over 2014-15) will be put up for auction.

Shares of state-run coal mining giant Coal India were off 1.11% at Rs 315.45. The stock was volatile. The stock hit a high of Rs 323.90 and a low of Rs 314.45 in intraday trade.

Index heavyweight and housing finance major HDFC lost 1.41% at Rs 1,160.80. The stock hit a high of Rs 1,180.80 and a low of Rs 1,159 in intraday trade.

Index heavyweight and cigarette maker ITC lost 0.92% at Rs 321.40. The stock hit a high of Rs 323.80 and a low of Rs 319.50 in intraday trade.

Bharat Heavy Electricals (Bhel) dropped 4.86%, with the stock extending previous sessions' 3.99% losses.

Crompton Greaves slumped 21.72% at Rs 130.80 after the company reported consolidated net loss of Rs 107.03 crore in Q3 December 2015 as against net profit of Rs 274.29 crore in Q3 December 2014. Net sales declined 14.18% to Rs 2067.80 crore in Q3 December 2015 over Q3 December 2014. The result was announced after trading hours yesterday, 2 February 2016.

In a separate announcement after trading hours yesterday, 2 February 2016, Crompton Greaves said that with effect from 3 February 2016, Laurent Demortler will be stepping down as the CEO and Managing Director of the company and K. N Neelkant will take over as CEO and Managing Director of the company. From 1 April 2016, Madhav Acharya will join as a member of the Board of the company as Executive Director Finance in addition to being the CFO of the company. Norberto Santiago will remain as the CEO of the international Automation business and will report to the international board of the company.

Meanwhile, the company further added that its board of directors received a definitive offer for the purchase of selected power businesses in Europe, the USA and Indonesia. After due discussion and deliberation, the board decided not to accept the offer in its current form.

Shares of oil exploration and production (E&P) firms edged lower after sharp decline in crude oil prices overnight. Cairn India (down 1.86%), Oil India (down 1.74%), ONGC (down 1.68%) and Reliance Industries (down 2.13%) declined. Lower crude oil prices will result in lower realization from crude sales for oil exploration firms.

Shares of public sector oil marketing companies (PSU OMCs) also declined. BPCL (down 2.21%), HPCL (down 1.88%) and Indian Oil Corporation (down 0.69%) edged lower

In the global commodities markets, Brent for April settlement was currently up 41 cents at $33.13 a barrel. The contract had declined $1.52 a barrel or 4.43% to settle at $32.72 a barrel during previous trading session.

Bank stocks declined. Among shares of public sector banks, Punjab National Bank (down 0.06%), Corporation Bank (down 3.34%), Allahabad Bank (down 2.54%), Bank of India (down 3.78%), State Bank of India (SBI) (down 2.01%), Union Bank of India (down 2.54%) and Canara Bank (down 2.85%) edged lower.

Among shares of private sector banks, Axis Bank (down 2.75%), HDFC Bank (down 1.11%), IndusInd Bank (down 0.26%), ICICI Bank (down 3.09%), Kotak Mahindra Bank (down 1.57%), and Federal Bank (down 0.97%) declined. Yes Bank rose 1.71%.
TCS rose 0.65%. The company announced after market hours today, 3 February 2016 that Investec India, a part of wealth management giant Investec, has gone live on TCS BaNCS to power its front and back office operations in India.

Index heavyweight and IT major Infosys dropped 1.42% at Rs 1,158.15. The stock hit a high of Rs 1,175 and a low of Rs 1,152.70 in intraday trade.

The Sensex and the Nifty edged lower for the third day in a row. The Sensex has declined 647.37 points or 2.6% in three sessions from its close of 24,870.69 on 29 January 2016. The Sensex has fallen 1,894.22 points or 7.25% in calendar year 2016 so far (till 3 February 2016). The Sensex is up 383.56 points or 1.6% from a 52-week low of 23,839.76 hit on 20 January 2016. The Sensex is off 5,801.42 points or 19.32% from a record high of 30,024.74 hit on 4 March 2015.

NIFTY INTRADAY VIEW ( 03 / 02 )

NIFTY INTRADAY LEVELNIFTY PROBABLE HIGHNIFTY PROBABLE LOW
R47612BULL76457345
R37544UP BREAKOUT75857405
R27520UP CAUTIONLEVEL FOR LONGLEVEL FOR SHORT
R17504SELL75847457
PIVOT7487 LAST DAYSTRONG BEAR
S17407BUYOPEN7567
S27391DOWN CAUTIONHIGH7576.0
S37367DOWN BREAK OUTLOW7428.0
S47299BEARCLOSE7455.55
NIFTY MONTHLY LEVELNIFTY DAILY VOLATALITY1.99%
R26082LONGNIFTY WEEKLY VOLATALITY2.66%
R15976SHORT EXITNIFTY WEEKLY HIGH7600.0
S15765LONG EXITNIFTY WEEKLY LOW7403.0
S25659SHORTNIFTY DAY MEAN7501.5

Tuesday, February 02, 2016

THE END SESSION ( 02 / 02 )

Key indices edge lower for the second day in a row


Stocks of metal and mining companies, oil sector firms and public sector companies led losses for key benchmark indices. The barometer index, the S&P BSE Sensex, lost 285.83 points or 1.15% to settle at 24,539. The losses for the 50-unit Nifty 50 index were higher in percentage terms than those for the Sensex. The Nifty dropped 100.40 points or 1.33% to settle at 7,455.55. After seeing high volatility in mid-morning trade in the aftermath of the Reserve Bank of India's (RBI) decision to keep its benchmark interest rate unchanged after a monetary policy review, the Sensex and the Nifty moved decisively lower later on weakness in European stocks and losses for US index futures, with the two key benchmark indices extending losses in late trade. The Sensex and the Nifty edged lower for the second day in a row. World stocks fell as fresh losses for oil weighed on sentiment.

The broad market depicted weakness. There were more than two losers against every gainer on BSE. 1,843 shares fell and 859 shares rose. A total of 106 shares were unchanged. A number of stocks forming part of the BSE Small-Cap index registered losses exceeding 4% for the trading session. The BSE Small-Cap index skidded 1.25%. The BSE Mid-Cap index shed 1.74%. The losses for both these indices were higher in percentage terms than those for the Sensex.

Shares of oil exploration and production (E&P) companies declined on sharp drop in crude oil price. Bank stocks edged lower after the RBI kept the repo rate and the cash reserve ratio (CRR) unchanged after the latest policy review. Tech Mahindra dropped after announcing Q3 results. Lupin moved higher after the company's US subsidiary announced the launch of a generic drug in the US.

The Sensex lost 285.83 points or 1.15% to settle at 24,539, its lowest closing level since 28 January 2016. The index lost 364.30 points or 1.46% at the day's low of 24,460.53. The index rose 103.92 points or 0.41% at the day's high of 24,928.75.
The Nifty dropped 100.40 points or 1.33% to settle at 7,455.55, its lowest closing level since 28 January 2016. The index lost 127.90 points or 1.69% at the day's low of 7,428.05. The index rose 20.35 points or 0.26% at the day's high of 7,576.30..
The total turnover on BSE amounted to Rs 2888 crore, higher than turnover of Rs 2603.85 crore registered during the previous trading session.

Among sectoral indices on BSE, the S&P BSE Utilities index (down 2.11%), the S&P BSE Power index (down 2.42%), the S&P BSE Auto index (down 1.39%), the S&P BSE Finance index (down 1.3%), the S&P BSE Bankex (down 1.68%), the S&P BSE Oil & Gas index (down 2.59%), the S&P BSE Realty index (down 1.71%), the S&P BSE Healthcare index (down 2.46%), the S&P BSE Basic Materials index (down 2.4%), the S&P BSE Metal index (down 4.33%), the S&P BSE Industrials index (down 1.79%), and the S&P BSE Energy index (down 2.69%) underperformed the Sensex. The S&P BSE Consumer Discretionary Goods & Services index (down 1.02%), the S&P BSE Telecom index (up 0.41%), the S&P BSE Teck index (down 0.19%), the S&P BSE IT index (down 0.17%), the S&P BSE FMCG index (down 0.44%), and the S&P BSE Capital Goods index (down 0.9%) outperformed the Sensex.

In overseas stock markets, European stocks edged lower as oil prices resumed their downward trend and as concerns over global economic growth persisted. Trading in US stock index futures pointed to losses for US stocks at the opening bell. Trading in US index futures indicated that the Dow Jones Industrial Average could slide 108 points at the opening bell today, 2 February 2016.

Asian equities edged lower on fresh weakness in oil prices. But Chinese stocks edged higher after the country's central bank injected more liquidity into the financial system, in a move to stave off potential liquidity squeezes ahead of the weeklong Lunar New Year holiday that starts on 7 February 2016. The Shanghai Composite index settled 2.26% higher.

Bank stocks edged lower after the RBI kept the repo rate and the cash reserve ratio (CRR) unchanged after the latest policy review. Among public sector banks, State Bank of India (down 2.28%), Bank of Baroda (down 0.86%), Punjab National Bank (down 1%), Indian Bank (down 1.85%), Canara Bank (down 0.99%) and Bank of India (down 1.38%) declined. IDBI Bank (up 1.2%) edged higher.

Among private sector banks, ICICI Bank (down 2.95%), Axis Bank (down 2.03%), IndusInd Bank (down 1.91%), Kotak Mahindra Bank (down 2.14%), Yes Bank (down 1.06%) and HDFC Bank (down 0.73%) edged lower.

Most auto stocks declined after the RBI kept the repo rate unchanged after the latest policy review. Ashok Leyland (down 0.6%), Maruti Suzuki India (down 1.79%) and TVS Motor Company (down 0.86%) declined. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
Tata Motors dropped 2.56% to Rs 329.70. The stock was volatile. The stock hit high of Rs 344.60 and low of Rs 328.10 in intraday trade. The company said total sales of Tata Motors passenger and commercial vehicles rose 10% at 47,034 vehicles in January 2016 over January 2015. The announcement was made by the company after market hours yesterday, 1 February 2016.

Mahindra & Mahindra (M&M) shed 1.79%. The company after market hours yesterday, 1 February 2016, announced that it has completed the sale of equity shares in its subsidiary Swaraj Automotives. M&M said it has received a consideration of Rs 24.83 crore from the sale of shares.

Bajaj Auto gained 1.48%. The company's total sales rose 2% to 2.93 lakh units in January 2016 over January 2015. Sales of motorcycles rose 2% to 2.52 lakh units in January 2016 over January 2015. Sales of commercial vehicles declined 2% to 40,951 units in January 2016 over January 2015. Exports dropped 8% to 1.32 lakh units in January 2016 over January 2015. The company announced the sales volume data before market hours today, 2 February 2016.

Hero MotoCorp declined 0.52% to Rs 2,521.80. The stock was volatile after the company reported monthly sales figures. The stock hit high of Rs 2,545.50 and low of Rs 2,510.25 in intraday trade. The company said its two-wheeler sales rose 0.89% at 5.63 lakh units in January 2016 over January 2015. Riding on the success of scooter range, driven by the new Maestro Edge and Duet, the company continues to expand its market share in the scooter segment, Hero MotoCorp said. Hero MotoCorp scooter sales rose 20% in January 2016 over January 2015.

Steel stocks led decline in metal and mining stocks. Tata Steel (down 7.6%), Jindal Steel & Power (down 5.72%), Steel Authority of India (down 7.61%) and JSW Steel (down 4.43%) edged lower. Among other metal stocks, Hindalco Industries (down 3.8%), Hindustan Zinc (down 2.96%) and National Aluminium Company (down 1.44%) declined.

Stocks of iron ore makers edged lower. Vedanta (down 8.38%) and NMDC (down 1.18%) declined. According to reports, the mines ministry has written to the finance ministry to withdraw 10% export duty on low-quality iron ore from Goa to help boost sales amid a sharp fall in prices. Goa is known for low-grade ore used mainly by Chinese steel mills.

Index heavyweight and housing finance major HDFC fell 0.36% at Rs 1,175.25. The stock hit a high of Rs 1,192.85 and a low of Rs 1,166.50 in intraday trade. HDFC announced during market hours today, 2 February 2016, that it intends to raise Rs 510 crore through private placement of senior secured redeemable non-convertible debentures. The debentures have a tenor of 3 years 131 days with a coupon rate of 8.59% per annum. The issue opens and closes on the same day tomorrow, 3 February 2016.

Tech Mahindra dropped after announcing Q3 results. The stock lost 4.68% at Rs 475.45. Tech Mahindra's consolidated net profit fell 3.4% to Rs 759 crore on 1.3% increase in revenue to Rs 6701 crore in Q3 December 2015 over Q2 September 2015. The sequential decline in bottom line was due to a sharp fall in non-operational income or the so called other income. The other income dropped 61.43% to Rs 63.94 crore in Q3 December 2015 over Q2 September 2015. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 3.2% to Rs 1136 crore in Q3 December 2015 over Q2 September 2015. The EBITDA margin edged higher to 16.95% in Q3 December 2015 from 16.64% in Q2 September 2015. The result was announced after market hours yesterday, 1 February 2016.

In US dollar terms, Tech Mahindra's net profit fell 3.7% to $115 million on 0.4% growth in revenue at $1015 million in Q3 December 2015 over Q2 September 2015. EBITDA rose 2.5% at $172 million in Q3 December 2015 over Q2 September 2015. The EBITDA margin stood at 16.9% in Q3 December 2015, an increase of 30 basis points on sequential basis. In constant currency terms, Tech Mahindra's revenue rose 1.2% on sequential basis in Q3 December 2015.

Stocks of public sector firms declined. NTPC (down 4.28%), Coal India (down 2.92%), GAIL (India) (down 1.4%), Bharat Heavy Electricals (Bhel) (down 3.99%), Bharat Electronics (down 0.82%) and Power Grid Corporation of India (down 0.58%) declined.

Pharma stocks declined. Aurobindo Pharma (down 4.28%), Cipla (down 3.98%), Glenmark Pharmaceuticals (down 5.1%), Wockhardt (down 2.48%), Ipca Laboratories (down 0.8%), Alkem Laboratories (down 0.43%), Dr Reddy's Laboratories (down 0.15%), GlaxoSmithkline Pharmaceuticals (down 0.41%), Divi's Laboratories (down 1.54%) and Cadila Healthcare (down 1.04%) edged lower.

Sun Pharmaceutical Industries (Sun Pharma) was down 4.12%. Strides Shasun was off 3.96%. Sun Pharma announced after market hours yesterday, 1 February 2016, that Strides Shasun has completed the acquisition of CNS divisions of erstwhile Ranbaxy Laboratories. It may be recalled that Sun Pharma had acquired Ranbaxy Laboratories.

Separately, Sun Pharma announced after market hours yesterday, 1 February 2016, the launch of Imatinib Mesylate Tablets (therapeutic equivalent to Gleevec for indications approved by the FDA) in US market. Sun Pharma's subsidiary received final approval for Imatinib Mesylate from United States Food & Drug Administration (USFDA) in December 2015. Being a First-to-File product, it was granted 180 days of marketing exclusivity by FDA from the time of its launch.

Lupin rose 0.71% at Rs 1,713.45 after the company's US subsidiary Lupin Pharmaceuticals Inc. announced the launch of its Metformin HCI ER Tablets, 500 mg and 1000 mg in the US. The drug is a generic equivalent of Santarus Inc.'s Glumetza HCI ER Tablets, 500 mg and 1000 mg. Lupin is eligible for 180 days of generic drug exclusivity for its Metformin HCI ER Tablets, 500 mg and 1000 mg. Glumetza HCI ER Tablets had annual sales of $450.4 million in the US as per IMS MAT Septemer 2015 data. The drug is indicated as an adjunct to diet and exercise to improve glycemic control in adults with type II diabetes mellitus.

Shares of oil exploration and production (E&P) companies declined on sharp drop in crude oil price. Cairn India (down 4.98%), Oil India (down 2.62%), ONGC (down 3.6%) and Reliance Industries (down 2.54%) edged lower. Lower crude oil prices will result in lower realization from crude sales for oil exploration firms.

Shares of state-run oil marketing companies (PSU OMCs) also declined. HPCL (down 2.35%) and Indian Oil Corporation (down 1.29%) edged lower.

BPCL lost 3.32% as the stock turned ex-dividend today, 2 February 2016, for interim dividend of Rs 12.50 per share for the year ending 31 March 2016.

In the global commodities markets, Brent for April settlement was currently off $1.07 a barrel at $33.17 a barrel. The contract had declined $1.75 a barrel or 4.86% to settle at $34.24 a barrel during previous trading session.

The Sensex and the Nifty edged lower for the second day in a row. The Sensex has declined 331.69 points or 1.33% in the two sessions from its close of 24,870.69 on 29 January 2016. The Sensex has fallen 1,578.54 points or 6.04% in calendar year 2016 so far (till 2 February 2016). The Sensex is up 699.24 points or 2.93% from a 52-week low of 23,839.76 hit on 20 January 2016. The Sensex is off 5,485.74 points or 18.27% from a record high of 30,024.74 hit on 4 March 2015.

Meanwhile, the Reserve Bank of India kept its benchmark interest rate viz. the repo rate unchanged at 6.75% after a scheduled monetary policy review today, 2 February 2016. The RBI kept the cash reserve ratio (CRR) unchanged at 4% of net demand and time liability (NDTL). While retaining accommodative stance of the monetary policy, RBI Governor Raghuram Rajan said in a statement that structural reforms in the Union Budget 2016-17 that boost growth while controlling spending will create more space for monetary policy to support growth. With unfavourable base effects on the ebb and benign prices of fruits and vegetables and crude oil, the January 2016 consumer price inflation target of 6% should be met, the RBI said. Consumer price inflation stood at 5.61% in December 2015.

Going forward, under the assumption of a normal monsoon and the current level of international crude oil prices and exchange rates, inflation is expected to be inertial and be around 5% by the end of fiscal 2016-17, RBI said. However, the implementation of the VII Central Pay Commission award, which has not been factored into these projections, will impart upward momentum to this trajectory for a period of one to two years, the RBI said.

5 HABITS THAT ARE STOPPING YOU FROM BECOMING RICH

Everybody loves a blame game.If stock markets crash just after you made your first investment in equity, it’s a bad gamble. When interest rates rise just when you take a home loan, you blame it on your luck.Our bad luck happens all too often!!

As a finance writer earlier and now as a financial planning guide for women, I have come to understand that we choose to multiply our savings with our habits and attitudes and not just due to sheer luck or timing.

I spend a lot of time helping people understand their wealth-obstructing habits. The top five are:

#1. Procrastination: 

Close the dormant bank accounts.Visit the post office to encash national saving certificate (NSC). Start a systematic investment into a mutual fund.

Our financialto-do-list just keeps growing. I admit having a long-one as well. Until I got an SMS alert from my bank about low minimum balance in3 out of 4 savings accounts I have, I didn’t realise that I needed to close the dormant ones.

Similarly a cousin in his early forties has been “thinking of an SIP” since the past 5 years.

A few weeks ago, I advised a friend to consolidate her multiple insurance policies into one and invest money in other avenues. She is yet to take out a weekend to figure out the list of the policies she has.

We make great plans but don’t implement it until we realise what is the cost of postponing these decisions.May be I should call up my cousin and say “You just lost the opportunity to earn 14-15% return on your savings”

2Staying Ignorant: 

Our ignorance is a blessing for someone who is lurking around for a big bonus or a commission. Someone who parked their savings into unit-linked insurance plan (ULIP) will very well understand the dangers of ignorance.

These days,bankers give it a fancy name; a savings product with words like guaranteed rate of return thrown into it. Recently a high net worth senior citizen couple in my family were persuaded to open a third bank account along with a Rs 20 lakh commitment into a closed-ended fund for 7 years. The banker came through a friend’s reference so they trusted him.

Staying ignorant these days could easily lead you into a trap of investments not suited for you.

3Being Fearful Always: 

Indeed equities are a very risky asset class. My heart sank when I heard a 22 year old engineering graduate telling me “I would rather put my first job’s savings in fixed deposits otherwise I will lose all of it in shares” The young man wasn’t really convinced about the mutual fund route too. You will have to work really hard for your retirement is what I felt like telling him.

Not that staying away from shares or equity funds is a wrong decision but there are some risks you can take early on in life. At 45, you should think twice about the equity risk you take. At 22, you can atleast try and see what a risky asset looks like.

4. Living a Life others live: 

We think owning the latest car or a phone is an absolute necessity, even if it depletes in value the moment we purchase it. For some people I have seen, a palm size tablet phone has got more value than a kids’ education fund.

Instead of our income, or budgets, it’s our office colleagues, relatives and neighbours Facebook posts that decide our expenditure. Whatever is left is what we save instead of it being the other way round.

5.Expecting a Free Ride Always: 

Let’s admit that we love bargains and we love free goodies with our grocery bills. But how many times do we really find those goodies worth using? 8 out of 10 times we don’t use it. Same is the case for the free financial advice that you always look out for? A free insurance or the accident cover that comes with credit card or investment plans, may not serve the purpose at all.

A stock broker will tell you to buy a stock that he must have bought two years ago at a much lower price.

But it’s our fickle mind that at times doesn’t want to do our own research and instead look out for someone who can tell us the best insurance policy or a best fund that will double the money at one go.