Month: April 2021

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IMF Estimates India’s FY22 GDP Growth at 12.5%; Tata Steel Production Hits New High in Q4 FY21

At 8:00am IST, the SGX Nifty Futures was trading at 14,751, compared with Nifty’s close of 14,683, yesterday.

Market status: Uptend Under Pressure

Distribution days: Seven

Global stock markets: Dow30, -0.3%; S&P 500, -0.1%; Nasdaq, -0.1%; Nikkei, -0.1%; Kospi, +0.2%

Yesterday, Nifty opened 100 points higher and advanced further to make an intraday high of 14,779. Similar to previous few sessions, it succumbed to selling pressure and turned negative intraday. Some buying in the last few hours helped the index close with a gain of 0.3%. Of Nifty50 stocks, 62% of the stocks advanced. Barring Nifty Media and Financial-related sectors, all the sectoral indices closed in the green. Nifty Pharma (+1.8%) and Metal (+1.4%) were the top advancers. The advance-decline ratio was in favor of advancers. Of 2,255 stocks traded, 1,157 advanced, 736 declined, and the rest remained unchanged. FIIs net sold shares worth Rs 1,092 crore, while DIIs net bought shares worth Rs 416 crore.

Nifty breached its 21- and 50-DMA on Monday, after hovering around its key moving averages in the past few weeks. Index breaching its moving averages is a sign of weakness. Yesterday, it found resistance around its 50-DMA. We will change the status to a Downtrend, if Nifty doesn’t retake its 50-DMA and if market leaders show signs of deterioration in their price actions.

Key News

Tata Steel achieved the highest ever quarterly crude steel production of 4.75M tonnes with 3% q/q growth in Q4 FY21.

Reliance Industries’s Jio Infocomm has entered into a definitive agreement with Bharti Airtel to acquire the right to use spectrum in 800MHz band in Andhra Pradesh, Delhi, and Mumbai circles through spectrum trading.

-In Gujarat, night curfew is imposed between 8pm to 6am from today till April 30.

-IMF increased FY22 real GDP growth estimates by 100bps (from January) to 12.5%. However, there is a severe downside risk to the growth outlook for the economy if COVID-19 cases continue to increase.

O’Neil Market Condition Report

For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 30%; [Rally Attempt], 12%; Uptend Under Pressure, 52%; Downtrend, 6%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 65%; Rally Attempt, 10%; Uptend Under Pressure, 25%; Downtrend, 0%.

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Nifty Manages to Close in the Green; Financials Continue to Decline

Today’s Action

Nifty, +0.3%; Sensex, +0.1%; Nifty Midcap, +0.9%; Nifty Smallcap, +1.4%; Model Portfolio, +2.1%

Market Pulse: Uptend Under Pressure

Distribution Day Count: Seven

Nifty opened 100 points higher and it advanced further to make intraday high of 14,779. As with the previous few sessions, it succumbed to selling pressure to turned negative intraday. Later some buying helped the index to close with a gain of 0.3%. Of Nifty50 stocks, 62% of the stocks advanced, led by Adani Ports and Special Economic Zone (+12.6%) and Tata Consumer Products (+4.6%). On the flip side, Power Grid Corp.Of India (-2.3%) and Grasim Industries (-0.9%) were the major decliners.

Barring Nifty Media and financial-related sectors, all the sectoral indices closed in the green. Nifty Pharma (+1.8%) and Metal (+1.4%) were the top advancers. The advance-decline ratio was in favor of advancers. Of 2,255 stocks traded, 1,157 advanced, 736 declined, and the rest remained unchanged.

Market Status Overview

– Nifty breached its 21- and 50-DMA yesterday, after hovering around its key moving averages in the past few weeks. Index breaching its moving averages is a sign of weakness. Today, it found resistance around its 50-DMA. We will change the status to a Downtrend, if Nifty doesn’t retake its 50-DMA and if market leaders show signs of deterioration in their price actions.

– Under current market conjecture, since we are in an Uptrend Under Pressure with higher number of distribution days, investors should consider booking profits in stocks that have performed well and have advanced 20–25% from their ideal buy points. Even if the market undergoes a small correction, these stocks are more likely to consolidate and test their moving averages. Further, stocks slipping below their 50- and 200-DMA on above average volume should be sold. Consider exiting stocks that have declined 8% from your buy price.

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Breakout Alert: Laurus Labs Stock Has Cleared a Buy Point Today

Laurus Labs stock has cleared an 11-week, 14% deep Flat base today. The stock is up over 4.0% on volume 250% greater than the 50-day average volume. Currently, the stock is trading around just 1% away from its ideal buy price of INR 386. The stock is offering investors an opportunity to get on board at the current price.

 

The key trend lines, 10 and 40-week moving averages are at a comfortable position. The current trends of both the averages are upward and the 10-week moving average is trending above the 40-week moving average. The current price of the stock is trading around 8% away from the 10-week moving average.

 

Laurus Labs has been a roaring outperformer as compared to the broader market. It has a top-notch Relative Strength Rating of 93. In the last twelve months, the stock has soared over 354% as compared to 60.6% for the Nifty500.

 

The Relative Strength Line of the stock is offering a lot of encouragement to investors. It has been making good progress in the last four weeks. The overall long term trend of the line is also trending upward. If Laurus Labs can maintain this outperformance, it could make sense as a CANSLIM trade.

 

Laurus Labs stock has a strong institutional support. The Accumulation/Distribution Rating of ‘A-‘ represents heavy institutional buying over the past 13 weeks. Although the shares held by institutions dropped in the last quarter, the number of institutions holding the stock increased at the same time. This shows increasing interest among the institutions.

 

On the earnings front, Laurus Labs has a respectable EPS Rank of 78, which is okay but needs improvement. The earnings and sales for the stock have grown by 68% and 26%, respectively over the past three years. Its 3-years earnings stability is 61, on a 0 to 99 scale (lower the better). Over the past five years, the sales for the stock have grown by 16%; however the earnings growth remained muted at -14%. The 5-years earnings stability is 99. The return on equity for the last reported year is 14%.

 

The stock belongs to the industry group of Medical-Diversified. You would still want to see some improvement in the industry group rank for the group. The current industry group rank is 132. The current price of Laurus Labs is -2% off from its 52-week high price and 471% above its 52-week low price.

 

The stock appears on our idea lists: Growth 50, Trend Template – 5 Months.

 

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This Long Term Leader is Still in Buy Zone: Mphasis Ltd.

Is Sequent Scientific Stock Ready for a Breakout?

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This Long Term Leader is Still in Buy Zone: Mphasis Ltd.

Mphasis Ltd. stock has cleared a 5-week, 12% deep Flat Base last week. The base is formed on another 5-week, 13% deep Flat Base that tried to clear a buy point in February, 2021. This makes it a base on base formation for the stock. Currently, the stock is trading around just -2% away from its ideal buy price of INR 1788. The stock is offering investors an opportunity to get on board at the current price.

What makes Mphasis Ltd.. a stock to watch closely is its consistency in earnings. It has an excellent EPS Rank of 88 and a very strong 5-years earnings stability of 4 which indicates its ability to post consistent earnings growth. The earnings and sales for the stock have grown by 18% and 15%, respectively over the past three years. Over the past five years, the earnings and sales for the stock have grown by 19% and 11%, respectively. The return on equity for the last reported year is 20%.

Another key part of the jigsaw is institutional sponsorship. Mphasis Ltd.. has an Accumulation/Distribution Rating of ‘B+’. This represents heavy institutional buying over the past 13 weeks. The number of institutional sponsors and shares held by the sponsors, both increased in the last reported quarter.

In the last twelve months, Mphasis Ltd. has rallied nearly 159.8% as compared to 60.6% for the Nifty500. It has a Relative Strength Rating of 78. We definitely would like to see improvement in the rating. At this point we are taking a step back and focusing on the RS Line.

The Relative Strength Line of the stock is offering a lot of encouragement to investors. It has been making good progress in the last four weeks. The overall long term trend of the line is also trending upward. If Mphasis Ltd. can maintain this outperformance, it could make sense as a CANSLIM trade.

The key trend lines, 10 and 40-week moving averages are at a comfortable position. The current trends of both the averages are upward and the 10-week moving average is trending above the 40-week moving average. The current price of the stock is trading around 5.7% away from the 10-week moving average.

The stock belongs to the industry group of Computer-Tech Services. You would still want to see some improvement in the industry group rank for the group. The current industry group rank is 87. The current price of Mphasis Ltd. is -3% off from its 52-week high price and 168% above its 52-week low price.

The stock appears on our idea lists: Trend Template – 5 Months, Long Term Leaders.

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Is Sequent Scientific Stock Ready for a Breakout?

Why You Should Watch Ratnamani Metals Stock Now?

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Is Sequent Scientific Stock Ready for a Breakout?

Sequent Scientific stock is worth watching as the stock is forming an 8-week, 19% deep Consolidation. The current price is only 6% away from its ideal buy price of INR 265. Aggressive investors could use any tight area Breakout inside the base as an opportunity to initiate a small position. A conservative approach may be to add the stock to your watchlist so that you are ready to pounce if it breaks out to the traditional entry point.

The key trend lines, 10 and 40-week moving averages are at a comfortable position. The current trends of both the averages are upward and the 10-week moving average is trending above the 40-week moving average. The current price of the stock is trading around 4.4% away from the 10-week moving average.

Sequent Scientific has been an outperforming stock as compared to the broader market. It has a strong Relative Strength Rating of 88. In the last twelve months, the stock has rallied over 208.4% as compared to 60.6% for the Nifty500.

The Relative Strength Line of the stock is offering a lot of encouragement to investors. It has been making good progress in the last four weeks. The overall long term trend of the line is also trending upward. If Sequent Scientific can maintain this outperformance, it could make sense as a CANSLIM trade.

Another key part of the jigsaw is institutional sponsorship. Sequent Scientific has an Accumulation/Distribution Rating of ‘A’. This represents heavy institutional buying over the past 13 weeks. The number of institutional sponsors and shares held by the sponsors, both increased in the last reported quarter.

On the earnings front, Sequent Scientific has an excellent EPS Rank of 94, which indicates consistency in earnings. The earnings and sales for the stock have grown by 168% and 13%, respectively over the past three years. Its 3-years earnings stability is 53, on a 0 to 99 scale (lower the better). Over the past five years, the earnings and sales for the stock have grown by 168% and 18%, respectively. The 5-years earnings stability is 53. The return on equity for the last reported year is 9%.

The stock belongs to the industry group of Medical-Diversified. You would still want to see some improvement in the industry group rank for the group. The current industry group rank is 132. The current price of Sequent Scientific is -6% off from its 52-week high price and 262% above its 52-week low price.

The stock appears on our idea lists: Trend Template – 5 Months.

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