DETAILS OF TRADING CALLS IN THIS WEEK

D uring the week ended markets witnessed high volatility, and choppy trade saw midcap and smallcap stocks decline sharply. Uncertainty and indecisive trend was evident in the two way movement of the benchmark indices. While the Sensex on the Bombay Stock Exchange managed to gain 141 points to close at 20,828, the Nifty on the National Stock Exchange shed 74 points to end at 6,200.

After witnessing strong run in the past few weeks midcap and smallcap stocks have started to correct sharply. The CNX Midcap and the BSE Smallcap indices lost 6.9 per cent and 8.6 per cent respectively.

Market breadth was weak in the last week, market players attributing it to heavy sales by investors who are showing strong appetite for the IPO of Reliance Power.

Weak US markets and uninspiring IIP numbers were dampeners but have raised hopes of interest rate cut. Encouraging results from tech biggie Infosys failed to trigger any rally in the tech sector. Marginal price hike in petrol and diesel is likely to be decided in the coming week.

Barring any unexpected negative results surprises, markets are likely to remain flat up to the Budget with occasional bouts of volatility. Narrow breadth of the pullback rally is a concern and indicates a lack of buying conviction from the retail investors.

For the indices to move higher, participation is required from more stocks from more sectors. For the week ahead chartists predict trading band of 20,340 to 21,260 for the Sensex and 6,000 to 6,530 for the Nifty. Strong support is evident at 20,500 and 20,260 for the Sensex and 6,120 and 6,040 for the Nifty. Key trend determining levels on the indices are at 20,020 and 6,020.

Avoid aggressive longs and initiate fresh positions only if indices cross last week's highs. Put trailing stops to protect profits. Where there is panic, there is also opportunity. Luck is the opportunity you take when it presents itself.

F&O segment D uring the week, trading volumes were on lower side in the derivatives segment. High intraday volatility is taking toll on traders. Nifty futures were seen facing stiff resistance around 6,330 and 6,350 level and good support was visible at 6,120. Risk takers can attempt short straddle at 6,200 strike to take advantage of prevailing volatility.

Encouraging Q3 results from tech major Infosys and second rung Mastek and IGate failed to enthuse the markets. Despite volatile rupee-dollar environments, good management of finances and holding of operating margins reflect that worst is over for the tech companies. Contrarian buying is suggested in technology stocks.

Buy TCS, Wipro, Satyam, Polaris and HCL Tech at current levels. Expectedly possible unlocking of embedded value of subsidiaries triggered good buying interest in ICICI Bank. Good results from Axis Bank vaulted the stock to new highs. Use corrections to accumulate both private and public sector banks. Metals hit rough patch with BSE Metals index falling by 7.6 per cent. However good results may see the stocks recover lost ground. Buy at current levels Tata Steel, Sterlite, Nalco and Hindalco. Ahead of Q3 results rumours of stock split or some very good news are back again in Reliance Inds. Punters tip price of Rs 3,450 in short term. With the spectrum issue slowly unfolding telecom stocks are back in the buy list. Buy RComm and Idea for surprising gains. Pricing pressures may see cement stocks fall some more.

Delay in payment of subsidy amount may keep fertiliser counters range bound. Riding piggy back on Reliance Power IPO power stocks continued to hold their recent gains. Avoid fresh buying for present as valuations look too pricey.

Realty stocks are witnessing good buying interest at lower levels. Buy DLF and Sobha Developers for further gains. After good run up, sugar stocks encountered profit booking at higher levels. Use sharp declines to take entry. Side counters and momentum plays like RNRL, RPL, Essar Oil, Ispat and others may witness sharp fluctuations in near term. Remember that as many as 17 stocks are under ban in F&O indicating rampant speculation and overbought condition.

Caution is the watch word. Timing the market, and not having any sense of how long you should hold the stock will not work in the markets.

Hind. Dorr-Oliver Ltd is a leading engineering company engaged in turnkey projects to serve a diverse range of industries like environmental engineering, pulp and paper, chemicals and fertilisers. The company has executed some outstanding phosphatic fertiliser plants, systems for water management, and the petrochemical and oil and gas industries. The company has secured mega orders for design, supply, engineering and construction of integrated effluent treatment plants from IOC and HPCL. Excellent results are forecast from the company. Buy at current levels for target price of Rs 300. ¦ Jayant Agro-Organics Ltd (JAOL) is an emerging global oleo chemical company with leadership in the castor based speciality chemicals industry. The company offers the largest range of Castor-based products in the world and global giant Japan's Mitsui & Co has taken 24 per cent stake in JAOL's fully owned subsidiary Ihsedu. Another Japanese major Itoh Oil Chemicals is taking 4.54 per cent equity in JAOL. Buy this budding global giant castor speciality chemical for target price of Rs 250. ¦ Technologies has fallen from its recent highs on orchestrated selling. Savvy punters are accumulating the counter aggressively. Boom in valuations for online advertising and social networking portals may see the stock regain its old glory. Buy at current levels ahead of results for price target of Rs 700. After moving up sharply in past few weeks the stock prices of Videocon Inds and Empee Distilleries have corrected to reasonable valuations. Datacom, a subsidiary of Videocon Inds has secured telecom license also. Unlocking of value by demerger of different divisions is on track. Buy at current levels for target price of Rs 950. Empee Dist is likely to report excellent Q3 results. Announcement of positive news is on cards. Buy for Rs 425 target.