Winning Strokes:

A Resurrected Dr.Reddy's "Political-steriod", baloons the market to the Bull Territory: The "innovative" decision of the RBI, this time cut short the spell of "doom and gloom" and "dressed-up the markets" for the next upmove; after the markets steadily conquered the important resistance level of 5150 on the Nifty: I have mentioned in my yesterday's mail to the Yahoo Group, SumanSpeaks that the market should not go too low from here because of the strong support in the range of 4980 and 4850 on the Nifty: Todays' strong rally not only attested my views but also silenced those bears (I mentioned in my letter yesterday to the Yahoo Group that bears will only lick their wounds in the days to come as the markets will be taken over by the bull army. And if Mr.Chidambaram helps a bit, then bears will be completely routed from the trading arena) who were tying to "win an impossible battle "against the heavily armoured Bulls":

The RBI as expected and as mentioned in my morning mail to the Paid Group Members, kept the Repo Rate unchanged---a very welcome sign: The markets are expected to "leap- frog" in the days to come as the Governor, made clear that India cannot sacrifice, its "habitual 8% growth" at the altar of inflation. RBI also increased the tolerance level of Inflation to 5.5% from earlier an obsolete 5%: I have been advocating this in various forums, so that the RBI becomes a little more pragmatic and increases the tolerance levels, since the inflation is here to stay for quite sometime. But if the growth is sacrificed too much then it will be difficult to bring the economy into back to the rails once again--it seems FM and RBI understood this simple fact at last. It now remains to be seen when the RBI will stop trading in Rupee and allow the INR to appreciate against the Dollar. But having said this rupee cannot be made to appreciate too much because of the yawning current account defecits:

Thanks Mr.Chidambaram, at last you have heard my call from Delhi. I hope such "innovative measures" are necessary to sail you party to the shores of Delhi. Keep the track record intact!! Now we need a little bit more from you in terms of Tax Reforms so that Day Traders will have a little easy way in the markets---please take into consideration that, many of these unfortunate breeds, might be maintaining their families, sitting in a small town in Gujarat or in Andhra Pradesh or in Kerala or in Assam, through the earnings of day trading!!! U have not done any justice to them by suddenly hiking the tax structure. I hope you would rationalise the tax structure so these Stock Market Participants are benefitted along with the long term players. I of course do not do any daily trading and my voice is for the collective good of the Market Participants: Anway, today, K Sera Sera Productions Ltd hit the buyer freeze before cooling down a bit: My Recommended Kenex Mircro Systems Ltd (Recommended at Rs.150--Rs.155, some weeks back), Ferro Alloys Ltd, India Foils Ltd, Ritesh Properties Ltd, Radhe Developers Ltd, BPL Ltd, Khoday Ltd, IKF Technologies Ltd (mentioned only a few days back to the Paid members) etc. hit the buyer freezes today. Next could be the turn of Southern Online Bio Technologies Ltd which is another players in the Bio-diesel space like IKF Technologies Ltd. But SBTL is highly undervalued at the CMP of around Rs.27:

There is some important developments in Phoenix International Ltd, which saw it hit the circuits before cooling down a bit. Is Phoenix International Ltd in anyway related to Focus Energy Ltd--the oil and gas major?? Why has Focus Energy Ltd taken loan??? How will it benefit Phoenix International Ltd after some months?? Why is tomorrow important for Phoenix International Ltd: Which stocks could be benefitted in a large way, due to the governments recent announcements in the matters of STP??

I would recommend a stock to the Paid Groups tomorrow which is at around Rs.14 and which is also into Bio-disel and is doing extremely well. But it will get maximum benefits from the government's recent announcements as regards to STP. The name by 8 a.m. tomorrow morning to the Paid Groups: Keep accumulating NEPC India Ltd, Relaxo Footwear Ltd and Southern Online Bio Technologies Ltd:

The market remained firm in mid-afternoon trade. It had surged in afternoon trade led by IT stocks after Finance Minister extended tax exemption for the IT sector by a year. Market had surged earlier after Reserve Bank of India (RBI) kept interest rates unchanged at its annual monetary policy review announced today afternoon. Rate sensitive banking, auto and realty stocks surged. Metal and oil & gas stocks rose. The market breadth was strong. The central bank raised the cash reserve ratio (CRR) by 25 basis points and the stance of its monetary policy was hawkish. The market had witnessed a bout of volatility earlier in the day ahead of monetary policy announcement. Asian markets which opened before Indian market were mixed. European markets which opened after Indian markets were mixed. At 14:21 IST, the 30-share BSE Sensex was up 368.72 points or 2.12% at 17,376.78. Sensex hit a high of 17,424.35 in afternoon trade. At the day’s high, Sensex rose 408.39 points. Sensex hit a low of 17011.60 in mid-morning trade. At day's low Sensex fell 4.36 points. The broader based S&P CNX Nifty was up 99.85 points or 1.96% at 5,189.50. The CRR is the percentage of banks' deposits which they must keep as cash with the central bank. It may be recalled that RBI had earlier this month announced a two-stage rise in CRR to 8%. The Reserve Bank of India (RBI) said managing liquidity would continue to receive priority in its policy objectives and warned it would act swiftly to curb any signs of adverse developments in inflation expectations. RBI has forecast economic growth of 8% to 8.5% in the fiscal year that began this month, after an estimated 8.7% growth in 2007/08. RBI said it aims for inflation of around 5.5% this fiscal year with the goal of lowering it close to 5% as soon as possible. The market breadth was strong on BSE with 1560 shares advancing as compared to 1047 that declined. 65 remained unchanged. The BSE Mid-Cap index rose 0.99% to 7137.46 and BSE Small-Cap index rose 0.72% to 8,7772.82. Oil & Gas stocks rose. Reliance Industries (up 2.89% to Rs 2,668), GAIL India (up 1.51% to Rs 443.50), Reliance Petroleum (up 2.6% to Rs 199), ONGC (up 1.16% to Rs 1,059.80) edged higher. IT stocks surged. Satyam Computer Services (up 7.54% to Rs 476.35), Infosys (up 4.51% to Rs 1,740), Wipro (up 4.33% to Rs 477.50) and Tata Consultancy Services (up 3.63% to Rs 915.05) edged higher. Finance Minister Palaniappan Chidambaram extended by a year a tax holiday scheme for export-driven software companies as he outlined some changes to the federal budget for 2008-09. The scheme for facilities based in technology parks was set to expire in March 2009. Realty stocks edged higher. Indiabulls Real Estate (up 0.96% to Rs 545.20), DLF (up 6.87% to Rs 714.50) and Unitech (down 4.43% to Rs 306.50) rose. Metal stocks rose. Tata Steel (up 2.68% to Rs 798.40), National Aluminium Company (up 3.99% to Rs 457.05), Hindalco Industries (up 6.28% to Rs 197.90), Steel Authority of India (up 1.08% to Rs 177.65), Sterlite Industries (up 2.56% to Rs 880.60) edged higher. Finance Minister P Chidambaram today said government will impose export tax on basmati rice and some steel products, and cut import duties on key inputs like ferro alloys and metallurgical coke. He said the measures were being taken to improve domestic supplies and to moderate prices. Banking stocks surged after the RBI's policy announcement. Punjab National Bank (up 3.88% to Rs 575), Federal Bank (up 3.61% to Rs 250), Bank of Baroda (up 3.22% to Rs 316.95), State Bank of India (up 2.64% to Rs 1,783), HDFC Bank (up 1.27% to Rs 1,535.05) and ICICI Bank (up 1.18% to Rs 905.95) edged higher. Auto Stocks edged higher. Mahindra & Mahindra (up 0.62% to Rs 639.20), Tata Motors (up 1.2% to Rs 641.20) Maruti Suzuki India (up 1.33% to Rs 734), Hero Honda Motors (up 3.77% to Rs 849), rose. HDFC (up 4.52% to Rs 2842.65), Larsen & Toubro (up 2.25% to Rs 3012) Jaiprakash Associates (up 3.9% to Rs 260.70), Ranbaxy Laboratories (up 1.6% to Rs 486.35), Reliance Infrastructure (up 1.54% to Rs 1448) edged higher from Sensex pack. Hindustan Unilever rose 1.64% to Rs 251.25. Net profit of Hindustan Unilever declined 3.04% to Rs 380.95 crore on 19.14% rise in sales to Rs 3793.94 crore in Q1 March 2008 Q1 March 2007. The board of the company has approved the change in the financial year to April-March. Reliance Communications declined 1.5% to Rs 576 while Bharti Airtel fell 2.67% to Rs 904.50. Reliance Communications said on Monday, 28 April 2008, it would offer unlimited national long distance calls within its network for a fixed rental with immediate effect. Earlier yesterday, sector leader Bharti Airtel slashed long distance and roaming tariffs by 43% effective 30 April 2008. Deep Industries hit 5% upper circuit at Rs 141.10 after it won Rs 41.55 crore order from ONGC. It its latest report on macroeconomic and monetary developments in 2007/08 released on Monday, 28 April 2008, RBI has said that the global food prices were likely to remain firm as supply side pressures did not appear to be abating. The central bank said steps takes by the government to rein in prices should help curb inflation. It, however, said the inflation risks on account of oil prices remain incipient. RBI has noted that freely priced fuel items such as naphtha had increased substantially since February 2007 alongside rising global oil prices, while prices of petrol and diesel, which are government-controlled, had partially adjusted. But prices of kerosene and cooking gas had not been raised by the government for several years. RBI felt there were some demand-side pressures. Domestic iron and steel prices saw a sharp increase in line with recent hardening in international steel prices, it said, while cement price rises could be attributed largely to strong demand from construction domestically. A survey of professional forecasters by the central bank showed that the Indian economy is expected to grow 8.1% in the 2008/09 fiscal year that began this month. In 2007/08, the gross domestic product is estimated to have grown 8.7%. A cause for concern is the fall in business confidence index. A survey of 392 companies by Federation of Indian Chambers of Commerce and Industry (FICCI), showed that concerns about an economic slowdown, inflation and rising costs hurt business confidence of Indian firms during October-December 2007 period. The FICCI business confidence index declined to a new five-year low of 55.3 points in the third quarter of 2007/08, from 61.2 in the previous quarter. On the flip side, a pointer to the fact that the long term India growth story remains intact is the outcome of the latest 2008 US-India Business Council (USIBC) survey, according to which, India is, and will continue to be, a premier destination for investment by US firms, with a large number of respondents rating future economic growth in India as highly sustainable. Meanwhile, the Lok Sabha is slated to pass the Finance Bill 2008-09 today, 29 April 2008. The two-day US Federal Reserve policy meeting ends on Wednesday, 30 April 2008. The market expects the Fed to cut interest rates by 25 basis points to 2% and then signal that its rate-cutting cycle may be over for now in the face of mounting global energy and food inflation pressure. As per provisional data, FIIs sold shares worth a net Rs 38.33 crore on Monday, 28 April 2008. Domestic funds sold shares worth a net Rs 166.61 crore on Monday. FIIs were net buyers of Rs 455.13 crore in the futures & options segment on Monday. According to data released by the NSE, FIIs were net buyers of index futures to the tune of Rs 214.86 crore and bought index options worth Rs 137.14 crore. They were net buyers of stock futures to the tune of Rs 24.42 crore and bought stock options worth Rs 78.72 crore. US stocks ended flat on Monday, 28 April 2008, as a $23 billion takeover of Wm Wrigley Jr Co, the world's largest chewing gum maker, by Mars Inc, the maker of M&Ms candy, helped offset downbeat comments by influential investor Warren Buffett about the economy. Buffett said US could be mired in a longer and deeper recession than most people think. Asian stocks were mixed today. Key benchmark indices in Hong Kong and China were up by between 1.05% to 1.4%. Key benchmark indices in Singapore, Taiwan and South Korea were down by between 0.64% to 2.07%. Japanese markets were closed for a national holiday. European markets were mixed. France’s CAC 40 and Germany’s DAX and were down between 0.22%-0.36% while UK’s FTSE 100 rose 0.6%.