Pre-Market Report: 22.06.2009

[B. Karthick]

Stocks likely to trade up in early trade

Stocks in India are likely to move side ways as investors weigh in the
sustainability of the rally in the markets. Expect the benchmark index
or the Sensex in a band of nearly one percent or 150 points with a
bullish undertone. Bulls look to build on the positive momentum we
have seen towards the end of the week.

Markets in Asia are looking to open higher on some positive comments
by the International Monetary Fund.Japanese stock futures rose after
the International Monetary Fund’s No. 2 official said the IMF will
lift its world growth forecasts. The Japanese benchmark or Nikkei is
up by nearly 0.6 percent in pre-market trade.

We might see a small build up in the run towards budget and can expect
some brisk trading in Textile, Power, Insurance and retail and export
oriented companies. We are bullish on select retail and textile stocks
in the short term and a small rally is not ruled out in these
sectors.We have some picks for our subscribers to benefit from the
railway budget.

Stayam Computer services will go by 'Mahindra Satyam' pulling the
curtains on the dark past of the IT bellwether.The stock of Reliance
Communications Rs 305 is likely to be in limelight as news reports
suggest that the world's largest mobile company,China Mobile is
mulling to pursue strategic alliance and a possible equity partnership
of 5 percent in the ADAG company.Expect some early fire works in the
stock.

Short term investors could place some calculated bets on stocks that
are likely to benefit from budgetary reforms. Traders could look at a
minor up move in metals and select midcaps in today's trade. Gujarat
Industrial Power, Bartronics,Insecticides India, Religare Enterprises
and BGR Energy are the stocks to keep on the radar in Monday's trade

B.Karthick
Research Analyst