Financial Daily from THE HINDU group of publications
Sunday, Sep 08, 2002
Financial Daily from THE HINDU group of publications Sunday, Sep 08, 2002 |
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Investment World
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Stock Markets Markets - Commentary Zee, Guj Ambuja may remain subdued B. Krishnakumar
AFTER some firm trend in earlier weeks, the stock market passed through a relatively bearish environment in the just concluded week. The weak trend in American bourses had a dampening impact on stock markets the world over. As a result, the domestic market sentiment too was affected. Sensex (3141.11): As observed in previous weeks, the index managed to move to the target zone of 3230-3250. Technically, the inability of the Sensex to move past the crucial resistance level at 3250 is a major negative factor. The index appears to have still some distance to be covered on the downside. The immediate support lies at the 3050-3070 band and a break of this range could pave way to the 2950-3000 range. As of now, only a move above 3250 would reinstate short-term bullishness. Recommendations for the week: The focus this week is on Zee Telefilms and Gujarat Ambuja Cement. The outlook for the two stocks appears negative. The share price of Zee Telefilms appears to be headed towards the Rs 50-55 band. Though the scrip is not likely to crash immediately, a steady slide towards this price target appears to be on the cards. A drop below Rs 95 would be an early indicator of further weakness in Zee. Existing holders could use price upmoves to reduce exposures. Fresh buying in Zee Telefilms may be deferred for the time being. In the case of Gujarat Ambuja Cement, the overall price pattern in the stock does not appear positive. The share price could slide to the Rs 135-140 band shortly. Investors having equity stake in the company could dilute holdings and probably contemplate re-entry at around Rs 140. Recommendation follow-up Contrary to last week's expectations, the share price of Tata Engineering and Hughes Software ruled relatively weak. This, however, has not negated the positive outlook for the two scrips. After touching a high of Rs 144.65, the share price of Tata Engineering turned weak on Friday. The scrip still appears to have the potential to touch a target zone of Rs 152-155. A drop below Rs 133 would, however, blunt the possibility of such a rally. Existing holders could remain invested with a stop at Rs 133. Fresh buying may be deferred for the time being. The share price of Hughes Software too ruled weak in the last few trading days. The scrip however still has the potential to touch Rs 195-200 band. Existing stakeholders could stay on with a stop loss at Rs 160. A drop below Rs 159 would warrant dilution of stake in the company. (Note: Recommendations in this column are based entirely on technical analysis using the Elliott Wave and the Point & Figure theory of the past price behaviour of the scrip concerned. There is a risk of loss in trading.)
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