Though Reliance Industries (RIL), which announced its January-March earnings after trading hours on Friday, disappointed markets, investors are hoping that results of other top companies such as Tata Consultancy Services, ICICI Bank and Wipro among others would trigger rallies in their specific stocks or sectors.
"RIL's core business margins have been affected. Moreover, there is a large amount of other income, mostly as interest from the high-cash holdings," said Arun Kejriwal, founder of Kejriwal Research and Investment Services.
"The market hasn't factored in the full results yet, and ideally the stock should correct next week as some foreign investors exit positions. Then again, the company could also buy back shares," he said, referring to RIL's one-year buyback programme announced in January, which means the company's share purchases could support the stock price. RIL fell 1.4% to 731 on Friday
Brokers said the proposal to levy short-term tax on foreign investors trading from tax havens is the biggest source of concern as the absence of inflows along with a current account deficit could weigh on the rupee further. A weaker rupee will widen the country's fiscal deficit.
"Markets are giving a lot of weightage to the GAAR issue," said DK Agrawal, CMD at SMC Securities, "The rate cut was a ray of hope, but concerns over GAAR soon took over because money from FIIs is just not coming in. If the finance minister can make some clarifying statements, then it could help relieve fears," he said.
Investors will keenly watch TCS results to see if the Infosys results were an industry-wide phenomenon. The Infosys stock was beaten down on the bourses after it provided a dim guidance for the year ahead and announced below-expected results.
Technical analysts said Nifty is expected to trade between 5,240 and 5,400 points. "A closing below 5,240 could take the index to its 200-day moving average of 5,150 points, but we don't see the possibility of that happening," said Dharmesh Shah, technical analyst at ICICIDirect.com.
By : [The Economic Times]
