Nifty likely to cross 5580, banks to do well: Anu Jain

Excerpts from Bazaar on CNBC-TV18 Watch the full show » ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets Axis Bank BSE | NSE 01/06/12 Are Mutual Funds betting on Axis Bank? Other Stocks in this news State Bank of India | ICICI Bank | HDFC Bank | Petronet LNG Ltd | Exide Industries | Crompton Greaves | Praj Industries | Larsen and Toubro | Union Bank of India | Jammu and Kashmir Bank |

Indian market has gone into a consolidation mode on the first day of the week on the back of the weak Asian market. Speaking to CNBC-TV18, Anu Jain of IIFL Private Wealth Management said that the Nifty has managed to touch 5,580 level despite volatility and once the credit policy result is announced, the market is likely to achieve balance and may even grow further.

"This week is also going to be essentially volatile because there is expiry; there is credit policy tomorrow and the overhang of the US debt issue. However, we may be surprised with the kind of steadiness we may see in the market this week. The nifty is likely to cross 5,580 level," she added.

Below is a verbatim transcript of her interview with CNBC-TV18's Udayan Mukherjee. Also watch the accompanying video.

Q: Did Friday signal any kind of a short-term breakout or would you not be trading long this week?

A: I think the bias is definitely undertone; it is now getting more positive than what it was last Monday. Volatility has been the name of the game the whole of last week and so we have seen essentially stops of both longs and shorts get hit not once but quite a few times of the last one week. However, the fact that it could hold 5,580, then it will definitely be a carry home positive. This week is also going to be essentially volatile because there is expiry; there is credit policy tomorrow plus the overhang of the US debt issue.

However, given that we may be surprised with the kind of steadiness we may see in the market this week compared to last week. So I think post tomorrow you may see a kind of balance coming into the market. And given the fact that some of the results have been positive I think it could carry on for some more time. So if we can hold on to this 5,580 kind of levels, then I think higher levels are definitely possible.

Q: How is the Bank Nifty looking to you approaching the monetary policy event tomorrow with specific reference to names like Axis Bank which did very well?

A: Axis had the result event which kind of panned out well, so I'm positive on Axis. There is some resistance at 1340 levels which is about I think 3-4% away from here. So it is definitely capable of moving up to there. Any dip for any reason should be a reason to buy rather than cut your position. So, I would look out for Axis to buy.

If you look at the whole Bank Nifty as a pack, State Bank is extremely strong though it is going to kind of have results but closer to 2,550 it is at resistance. If it crosses that, then you may have a fresh move into the Bank Nifty which could take it much higher than where it is right now.

If you look at the other components like ICICI , it is looking better, so from last week to this week it has run up though not as much as Axis and I think the results are still pending. The resistance is closer to 1,091, which is again very crucial.

If you look at HDFC Bank post the results, it is consolidating around those 500 levels. So no major upmove, in fact if anything had to be carried home from Friday, I think there were some positions which are shifted from HDFC to Axis. So I would say all in all in the private banking side, Axis is definitely the strongest out there.

Q: The star of last couple of weeks has been Petronet LNG ; are the technicals still bullish?

A: Definitely. I would only say it looks overbought, but the fact of the matter remains that there is still upside which is possible about Rs 190. If think it needs a consolidation phase at about this Rs170-176 zone, because it did a 5% even on Friday. However, one can expect that in the medium-term or at least a month-month and a half to, it may give you Rs 190 target.

Q: Where are the supports in Exide, which has lost quite a bit of ground on Thursday and Friday?

A: Exide has taken a knock post results, and it would take some time for the stock to recover. If you look at the whole market, it is in a mood to kind of punish stocks where the results have not been good, Crompton is one example. However, at the same time, it is giving a bias for Praj Industries and Petronet on the other side.

Q: Are you bullish on L&T for this week?

A: Yes, it has gone tested that Rs 1780 level. It stayed there, came back to those Rs 1827 levels, I think this is more of an investment call for people who are looking for stock ideas which would probably kind of be with them for the next 3-6 months. I think this is poised towards the Rs 1975 level dips whether it is up to again the Rs 1780 levels. I would buy into the stock, on the dips or current price for the target of Rs1975.

Q: What about the other banks? The public sector names? Union Bank did quite well despite the lackluster numbers, are you seeing any signs of technical turn around in the public sector names?

A: If I were to look at the PSU Bank index which is there, that is showing a positive bias for sure. But the whole scare is that it is a result week. So you can have them moving in different directions, still it is definitely strong as an index. If you look at individual stocks Union Bank was reacting post results. So then you usually say that it is bounce which is coming post results.

If I had to take a call today that there is a PSU Bank which I want to trade in, then I would probably pick up J&K bank. Liquidity is not so much of a big point going for it, but at Rs 862, at least on the charts, it is looking good for about Rs 910 over in a month's time. So that gives you 67% to play for. At the same time, keep a stop of Rs 841. So, I think I will go with it that PSU Banks do look positive but as the stocks play out their results individually, that would be an impact.

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