Nifty Update:

Nifty has broken its up trendline of post-budget rally and the up-channel is now history. Technically Nifty is showing a lot of weakness now and with last 3 weeks closings being very flat market is showing signs of big correction ahead. In weekly graph Nifty is trading near channel resistance and so upside looks limited from here. Caution is advised and it is better to be in good cash levels but holding some stocks for long term (only around  30% invested) would be fair allocation at this point of time. IFCI, ONMOBILE, DISHMAN look good for upside and this is still a stock-specific market. Nifty crucial support at 5200 below which short-term panic selling is not ruled out and 5000 would be psychological level to watch. Sensex has failed to move above 18000 so far.

Companies bleed in Naxalite bloodbath

The faceoff with Naxalites is hurting India’s industry. Even as the battle to regain mineral-rich areas from the control of the Naxalites kicks off, businesses are bearing the brunt of the violence and losing big money. With the confrontation only likely to escalate, many entities fear their operations could suffer big time in the crossfire. 

• Around 80 per cent of the country’s high-grade iron ore is in the red corridor. Orissa has 33 per cent of the reserves; Chhattisgarh, 19 per cent; Jharkhand, 27 per cent. Out of the total reserves of 23.59 billion tonnes of iron ore, 13 billion tonnes is haematite ore (high-grade ore) and 80 per cent of that is in the Naxalite-infested areas.
• Business has been under attack in neighbouring Orissa. Naxalites have been blowing up railway tracks, disrupting loading of minerals, raiding mineral deposits or damaging telecom towers. The growing clout of Naxalites in the districts bordering Andhra Pradesh, Chhattisgarh and Jharkhand is hurting business activities.
• In the past couple of years, the towers of mobile operators have turned out to be the soft targets of Naxalite violence. Industry sources estimate that at least 30 towers have been destroyed by Naxalites in the last two years. The Naxalites are targeting the towers to snap any communication among the police and the security forces, a senior police officer said on condition of anonymity.
• Disruption of work, levy to insurgents, targeting of communications and security concerns stall development. http://www.business-standard.com/india/news/companies-bleed-in-naxalite-bloodbath/391233/

The disruptions due to Naxalites are impacting many important industries such as Mining, Steel, Tea Plantation, Telecom and if these industries face disruptions the growth of the economy as a whole gets affected negatively. The expenditure after destroying the facilities is for a single company but when it happens on a regular basis, it can affect the whole industry segment. Destroying telecom towers is one thing but it makes communication between people impossible.

INVESTOR MEET IN NASIK ON 04-APR-2010:

Investor Meet was very popular and main attraction was Q&A Session where almost all the queries got answered by Mr A K Prabhakar and Tanmay G Purohit. Investors were made aware of common mistakes in Trading/ Investing and F&O along with psychological factors that affect positions adversely. Indian market outlook was also given where Investors were made aware of the growth contributors for India. Mr Prabhakar talked about stocks for long-term and the event was covered very well by media also.

"Risk must be taken in Life and Stock Market also - A K Prabhakar" - Lokmat

"Investors themselves need to study markets" - Gavkari

"Good returns follow good analysis - A K Prabhakar" - Sakal

Book your seat today for Next Investor meet in Chennai on 10/April/2010 Saturday for details : http://akprabhakar.blogspot.com/2010/04/investor-meet-in-chennai-on-10april2010.html

INVESTOR MEET In Nasik

Weekly Nifty Update 01 April, 2010 by Tanmay G Purohit
Nifty has closed positive (+9 points) at 5290 positive close 8th week in a row and this is highest weekly closing for Nifty after 18-Jan-2008. Nifty broke out above 5310 resistance this week but could not sustain as still it hasn’t closed above that level on any day. BSE MIDCAP and SMALLCAP indices closed higher this week outperforming Nifty/Sensex as stock-specific performance was witnessed on the back of NAV-propping by Mutual Funds. HDFC and TATA MOTORS rose more than 7% each, REALTY stocks recovered as DLF and UNITECH were one of top gainers in Nifty. TECH stocks were on receiving end this week as Rupee appreciated towards 18-month – INFOSYS -5%, HCL TECH -4%. SUGAR stocks continued to fall this week and RENUKA, SAKTHI SUGAR, BAJAJ HIND fell 5-6% each. 
India's manufacturing growth slowed down in March, dropping from a 20-month-record in February, as mounting cost pressures took a toll on expansion in output, a survey showed. The HSBC Markit Purchasing Managers' Index, based on a survey of 500 companies, fell to 57.8 in March from 58.5 in February, which was the strongest since June 2008. A reading above 50 means activity is expanding. Overseas fund houses have made a net investment of over Rs 20,600 crore ($4.5 billion) in Indian stock markets during the last three months of financial year 2009-10, according to the SEBI data. FIIs poured over Rs 1,09,300 crore in Indian stock markets in 2009-10. In contrast, they had sold shares worth Rs 47,706.2 crore in 2008-09. 
Sensex has formed a double top at 17790 levels and until a closing past 17800 is not seen, fresh strength would be difficult to come. Nifty has to close past 5310 on a sustained basis but stock-specific action is expected to continue as investors bet on expectations of Q4 March 2010 results. INFOSYS would be important as it starts the reporting season on 13 April 2010. Nifty falling below 5200-5170 support would be a sign for reversal in up-trend and below 5000 panic selling can be seen. Nifty may face strong resistance at 5370/5450 levels as volumes are still not supporting the up move. The forecast for the southwest monsoon for 2010 is the next major trigger for the market. Good rains this year after last year's drought will boost farm output and rural incomes. But another monsoon failure will add to inflationary pressure which in turn may hamper the current strong economic rebound.
Stocks looking good: FSL, DEEPAK FERT, TINPLATE, MRPL, DISHMAN
Supp 5230/5160/5095 Res 5328/5374/5455