FII and DII activity that was seen on Friday, February 27, 2009 is shown below. The report shows that FII were net seller of Rs. 463 crore where as enormous buying was seen by DII of around 649.26 crore.

Instanex FII Index: FII seem to be seller of Indian shares today. While Nifty was down by 0.79%, the Instanex was only down by 0.34% and DII portfolio was weaker by just 0.58%, which indicates that neither FII nor DII were buyers.

Instanex FII Index at close on Friday, February 27, 2009 

Citigroup Chief Executive Vikram Pandit sought to reassure employees in the midst of reports the U.S. government is in talks to increase its stake in CitiGroup.

The complete text of letter by Mr. Vikram Pandit follows:

Dear Colleagues:

As you know, financial markets around the world remained under great pressure this week, again fueling speculation about additional intervention in financial institutions by the U.S. government. As we continue to navigate these unprecedented times, I want to reassure you that I remain very confident in Citi’s prospects and business position around the world. Our Tier 1 capital base is very strong and is one of the strongest in the financial service industry. Additionally, we continue to focus and make progress on reducing the assets on our balance sheet, reducing expenses and streamlining our business for future profitable growth.

While rumors and speculation persist in the market, I want to highlight for you statements earlier today from U.S. government officials. The White House reiterated that it “continues to strongly believe that a privately held banking system is the correct way to go.” Additionally, the U.S. Treasury Department said “it plans to preserve a financial system that is owned and managed by the private sector.”

I know how challenging these times are, and ask only that you continue your outstanding work in serving our clients and customers around the world. Your hard work is generating results that we are seeing on a daily basis. We need to continue to do our part to instill confidence in the financial system. Building confidence starts with each and every one of us communicating the strength of Citi to our clients and customers every day.

With our presence in more than 100 countries, Citi continues to be uniquely positioned to benefit when the global economies rebound. Thank you for your continued effort and dedication.

Vikram Pandit

Reliance Industries Limited (RIL), India’s largest private sector enterprise, declared merger of Reliance Petroleum Limited (RPL) with RIL. RIL will issue about 34-crore additional equity shares of market value of approximately Rs 11,000 crore. Earlier, RIL had sold 4% stake in RPL taking its stake down to 71%.

The value of RPL’s assets has been put at Rs 21,000 crore by industry consultants and ChemSystems, a firm providing support in the field of petroleum, chemical, and petrochemical industries.

The merger would result in accretion of Rs 1,300 crore to RIL’s net profit. Post-merger, the equity shareholding of the promoters in RIL would come down from the current 44% to 34%.

The merger would increase RIL’s operational synergies and its cost efficiencies would optimise fiscal incentives, enhance financial strength and flexibility. It would also eliminate transfer pricing issues.

RIL’s shareholding pattern:

Promoters:       49%

MF/UTI:             2.53%

FII:                    15.52%

RPL’s shareholding pattern:

Promoters:       75.28%

The Gross Domestic Product (GDP) for the third quarter has been declined to 5.6% as compared to 8.9% during the same quarter last year. The GDP growth for previous quarter this year was 7.6%.

The average GDP growth for the period between April and December stands at 6.9% versus 9% during the same period last year.

The manufacturing sector declined by 0.2% in the October-December quarter as compared to last year, while the farm sector contracted an annual 2.2 per cent.

Nifty and Sensex dropped sharply immediately after the Q3 GDP growth numbers were declared.

Yesterday: As we said, Indian Stock Market didn’t show any movements due to last day of F&O but closed positive by 50 points.

Today: Market has not shown any sign of strength so far and every high must be capped by shorts.

BSE Sensex: (8843) The support for the Sensex is 8750-8630 and the resistance to the up move is at 9030-9157

NSE Nifty: (2786) the support for the Nifty is at 2730-2685 and the resistance to the up move is at 2824

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Today’s Pick:

-          Sell L&T around 622 with a intraday target of 615-612

-          Sell BHEL around 1430-1435 with a intra day target of 1418-1415

Profit booked through our yesterday picks:

-          Cairn India might have given a profit of Rs 3 per share.

-          HDFC didn’t reach our entry price, so trade was not executed.

FII and DII activity that was seen on Thursday, February 26, 2009 is shown below. The report shows that FII were net seller of Rs. 273.94 crore.

Inflation: Inflation for week ended February 14, 2009 declined at 3.36% as compared to 3.92% the week earlier. The inflation numbers are in line with the street expectations.

Wholesale Price Index (WPI) for all commodities declined by 0.1% to 227.8 a week earlier and December 20 WPI revised to 5.91% from 6.38%.

Yesterday: As we said, Indian Stock Market didn’t go up much despite other markets were up by 2-3%, and the same happened in yesterday’s trading session.

Today: Today also Indian Stock Market won’t see much movement unless RBI announce rate cut. But we may get strong opportunities for short if nifty reach the level of 2790-2800.

BSE Sensex: (8843) The support for the Sensex is 8600 and the resistance to the up move is at 9000.

NSE Nifty: (2736) the support for the Nifty is at 2680 and the resistance to the up move is at 2800-2810.

Today’s Pick:

-          Buy HDFC (1254) for delivery for a two month target of 1350-1400.

-          We strongly recommend to buy Cairn India as chart shows possibilities of solid upside and we revised our one month target from 170 to 175 as our team believes that crude is bottomed out and there won’t be any big fall in the price of crude.

Profit booked through our yesterday picks:

As we suggested buying

-          L&T at 628 for intraday, it might have given profit of about 20 Rs per share.

-          ICICI Bank didn’t reach our entry price of 338.

-          Reliance Industries at 1263 for intraday, it might have given profit of 18 Rs per share.

-          Reliance Capital at 376 for intraday, entry price was not reached so no trading in this stock.

So Stay connected and Keep visiting EquityPandit.com to book handsome profits in Stock Market.

FII and DII activity that was seen on Wednesday, February 25, 2009 is shown below. The report shows that FII were net seller of Rs. 384.37 crore.

Instanex FII Index: FIIs seems to be seller of Indian shares today. While Nifty and Sensex were up, DII 15 Portfolio also saw only rise by 0.60%, which indicated that neither FIIs nor DIIs were interested in buying.

 Out of the 15 companies of the Instanex FII Index, 12 gained while three lost. The main stocks contributing to the strength of the Index were ONGC (+3.02%; weight 4.44%), Infosys (+2.69%; weight 12.15%) and TCS (+2.53%; weight 2.61%). The main losers were HDFC (-2.86%; weight 11.10%) and L&T (-2.02%; weight 2.59%).

 Instanex FII Index at Close on Wednesday, February 25, 2009

Yesterday: As predicted market opened with negative trend and gradually started to see some short covering rally and ended flat.

Today: Indian Stock Market will see some more short covering rally as F&O expiry date is approaching. But don’t expect much upside trend, so profit booking should be done at every up move till this expiry.

BSE Sensex: (8843): The support for the Sensex is 8600 and the resistance to the up move is at 9000.

NSE Nifty: (2736) the support for the Nifty is at 2680 and the resistance to the up move is at 2800.

Today’s Picks:

Buy Lnt 628 with intraday

Buy ICICI @ 338 intraday

Buy RIL @ 1263 for intraday

Buy Relcapital @ 376 for intraday

Profit booked through our yesterday picks:

As we suggested buying

-          Reliance at Rs 1210 and it must have given profit of 40 Rs on one share.   

-          SBI at 996 and it reached the same level it must have given a profit of Rs 30 per share

-          Cairn India at Rs 149 and it must have given profit of Rs 7-8 per share.

-          ICICI Bank at Rs 315 and it must have given profit of Rs 7 per share.

So Stay connected and Keep visiting EquityPandit.com to book handsome profits in Stock Market

The Standard & Poor’s Rating Services (S&P) has revised the outlook on the long-term sovereign credit rating on India to negative from stable and has affirmed BBB rating on India.

The Outlook revision reflects that India’s fiscal position has been downgraded to a level that is unsustainable in medium term.

S&P negative rating for India is a bad news for Indian Financial Market.

Larsen and Toubro (L&T) said that it has bagged three orders worth Rs 1,438 crore for power-infrastructure related projects.

L&T reported Bombay Stock Exchange (BSE) on Tuesday that it has secured a Rs 800 crore order from AI Ain Distribution Company for the construction of seven electrical substations and overhead transmission line in Abu Dhabi.

Furthermore, L&T also bagged a Rs 300 crore order from Abudhabi Distribution Company for expansion of a 33 KV power transmission network in the gulf country.

L&T also secured a power project worth Rs 308 crore from West Bengal State Electricity Distribution Company for a rural electrification project in the state.

NEW DELHI: Government reduced Excise duty and Service tax by 2% on Tuesday, February 24, 2009. This step was taken to provide relief to the Industry stumbled due to the impact of slowdown.

Excise duty has been reduced from 10 percent to 8 percent and the service tax was cut from 12 percent to 10 percent.

The Finance Ministry said that the fiscal sops given to provide stimulus to slowing down economy will be effective from midnight on Tuesday and will have revenue implications of about Rs 28,000 crore.