Market outlook and stocks to watch

Last week was extremely good for the markets with markets holding the 5500 level quite well. At the same time they failed to cross the 5960 level(on a closing basis) which is offering a lot of resistance. So one needs to wait for this level to cross on the upside for taking aggressive long positions.

Individual stocks are showing lots of action. The reliance pack seems to be cooling down with the exception of Reliance Capital which looks set for higher levels.

One sector which one can closely watch is cement. I am seeing some interesting moves there and some quick short term gains can’t be ruled out in the sector.

In banking our old favourites like SBI continue to do well.

in Steel, people seem to have taken fancy to small steel companies. I’d book my profits in the same as the sector is getting too hot. Ispat Industries might still have some steam left though.

Again in the refinery sector I see a lot of buzz around MRPL and Essar Oil and the a lot of retail is getting into the scrip at these levels. If you are smart its still time to skim some profits off the table if you still want to ride these. My best bet in the sector remains Indian Oil Corporation which looks decent from a medium term perspective.

If markets remain in a range, then action shall shift to individual stocks in the midcap and small cap sector. So you need to keep your eyes open and spot the opportunities there.