GOLDEN RULES FOR TRADING

Oil Stocks Outlook for the week – 27 to 30.04.2015

Oil Stocks Outlook for the week – 27 to 30.04.2015

Stocks of the state-owned oil marketing companies will depend on news flow and movement in crude oil prices, which maintained momentum for the second consecutive week.
Oil prices, which had started inching up this month, are hovering around the $60 per barrel mark now. Any further spike in oil prices could weigh on stocks of Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum Corp.

However, that will be seen positive for upstream players like Oil and Natural Gas Corp
and Oil India, which have been under pressure due to the low oil prices.

Also, government's confirmation of reports that the two upstream companies will be exempted from bearing subsidy on cooking gas for financial year 2015-16 (Apr-Mar) and from bearing any subsidy burden for the Jan-Mar quarter also helped the two stocks, and may keep sentiment positive next week. Further depreciation of the rupee will also be seen a positive for upstream companies.



Cairn India, whose Jan-Mar results were way below street expectations, may still feel the tremors early next week. However, movement in the stock may not be much as the market is likely to have priced in the dismal performance. In the results declared Thursday evening, Cairn India reported a loss of 2.41 bln rupees in Jan-Mar, its first quarterly loss in seven years. If crude prices remain firm or inch up, Cairn shares could gain from their low levels.