Thanks to a recovery triggered by the software stocks, the Sensex gained 90 points during this week. Although it gained 3 per cent on weekly basis, the Friday close was weak as traders rushed to cover their long positions. The gain, however, has certainly improved the Sensex outlook.On the downside, it enjoys a strong support at 3197 points and for a optimistic scenario, it should not go below this level. On the upperside, it has a strong resistance at 3515 points. There are greater chances that it may move in the range of 3200-3500 points in the coming days.
The main component of the Sensex, Hindustan Lever has shown a mixed trend but the weightage has been higher on the positive side. ITC, if moves above Rs 830, can show a smart rally. This, in turn, can change the sentiment for better. Two other important counters - Reliance and State Bank are in good shape and are expected to behave in bulls' favour.
Counters like MTNL, Bajaj Auto and Bhel however may show some weakness. Bajaj Auto's rally shouldbe considered as correction to its previous fall which brought the stock down from Rs 565 to Rs 475. For MTNL and BHEL, good support lie at Rs 173 and Rs 258 respectively. A fall below these levels however would be harmful for these stocks.
During this week, Telco tried to cross the Rs 232 level but failed. If it manages to move above this level, then the journey till Rs 284 will be smooth. For Tata Tea, action is expected only after it crosses Rs 421 level.
Tisco has reacted sharply during the past few days. Once it moves above Rs 115, the recovery can excellerate. ACC may also show some recovery.
Among the software counters, Pentafour has shown an impressive rally. For this stock, no hurdle is likely before Rs 1,100. Rolta has given a fresh break-out. It has entered into a new bull orbit. Satyam Computers, if moves above Rs 950, then, crossing the Rs 1,000 level would not be difficult.
Among the others, positive trend is likely on counters like Arvind Mills, Cadbury, Cochin Refineries, Hero Honda,Esab India, Ingersoll Rand, TVS Suzuki and United Phosphorus. On other hand, profit booking is likely on counters like Atlas Copco, Bajaj Auto, Corporation Bank, German Remedies, GSFC, G A Cements, Madras Cements and Phillips. GSFC and Madras Cements have given a fresh sell break-out. An exit is recommended on these counters.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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