Deepak Singh Tanwar

The sentiment remained dull for a major part of the day on Monday and the trading volumes too remained at lower levels. While the IT stocks remained weak, few index based stocks like HLL, ITC, Ranbaxy help it to gain 14 points on Monday.

The current upmove of Sensex is more of a corrective nature and will face hurdles at higher levels. The level of 3640 points is an important resistance. The level of 3395 points is the first support.

Among the IT stocks, Infosys suffered the most. The stock lost more than 3 per cent and affected the uptrend for the index. The outlook for the stock will weaken further below Rs 3,700. The level of Rs 3,970 is an important hurdle.

The position of Satyam Comp also remains negative. The first resistance for the counter lies at Rs 215. Zee Tele may also show a dull move. Among the other heavyweights, HLL showed a bounce but as the rise is more of a corrective nature, selling pressure at higher levels is not ruled out.

The position of ITC is no different. The rally is of corrective nature. The outlook will weaken further below Rs 720. Reliance also improved marginally. The level of Rs 366 is the first base, and a sideways move is likely. Reliance Petro may also remain mixed.

SBI may show a firm trend. The performance of counters like Tisco and MTNL is likely to be mixed. Bhel and Cipla are expected to do well. Tata Tea and Telco may show a dull trend. Among the cement counters, ACC and L&T remained firm for a major part of the day. For ACC, the first resistance lies at Rs 149 whereas a base exists at Rs 133. For L&T, the stop loss level is Rs 230. GACL and and Grasim too remained firm. A further improvement is not ruled out.

Overall, while outlook for IT stocks remained negative, selective buying in old economy stocks will continue.

(The analyst does not hold any position in the stocks mentioned in the article)