February 6: The market closing on a firmer note (a gain of 9 points) gives hope that the Sensex can strengthen further. Some recommendations follow. I have avoided repeating my earlier comments on scrips like ITC, HLL, etc., which continue to hold good.ACC is giving away by micro-inches. It shows no strong inclination either down or on the upside, just travelling along the 7-day exponential moving average. Medium term investors who entered at Rs 1200 might as well take their capital elsewhere and return later, when the scrip becomes more lively.
At Arvind Mills one might as well wait some more time to see where the bottom is. Bajaj Auto is on the come back trail with high volume on Friday. Closing at Rs 507.50, the scrip seems to heading towards Rs 550. I consider Bajaj Auto to be a market barometer. It provided no incentive for short selling and therefore, the recovery does not appear to be due to covering of shorts. That goes to prove that there is a bullish undertone in the market. BHEL has lost itssteam and one might as well do precautionary profit booking on rises or before Tuesday. The scrip has a good potential upside for medium term, but the current market conditions warrant periodic profit booking.
BSES could come up with resistance at Rs 175-177 region; but with Rs 160 as a support line you need to re-enter after booking profit. For Colgate, Rs 240 is proving to be a hurdle, which it will have to overcome in due course. On GE Shipping, you get contrasting signals. However, I would recommend profit booking at Rs 45. If it overcomes Rs 45 resistance, it could move up to Rs 48. For Glaxo, Rs 350 would be a base support line. Grasim at Rs 271-282 looks tempting for a buy. But the recovery may well have been the result of short covering for those who pulled the scrip sharply down on Thursday. If the latter is the case, the scrip may not necessarily move up. It would be advisable to book defensive profit booking in HPCL, though you could take your chance for it to move up to Rs 450, if the marketmood strengthens on Monday. ICICI does not demonstrate any momentum to move up. You might as well book profit here on rises till Tuesday.
Interest has come back in IDBI and therefore you may hold your longs. On Larsen & Toubro, too, I recommend defensive profit booking. You may continue to hold on the MTNL counter. At Reliance, look for an entry opportunity at Rs 156. SBI is going to be a puzzle for both bears and bulls. My own impression is the balance is in favour of the scrip going down!
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