Wednesday, January 17, 2018

Market Pulse
Key benchmark indices edged higher in early trade despite negative trend in Asian stocks. The BSE  Sensex is now trading at 34,900.88 up 129.83 points or 0.37% while Nifty is seen at  10,731.40 up 30.95 points or 0.29%. IT stocks led gains on the bourses.

Among the secondary indices, the S&P BSE Mid-Cap index fell 0.19%. The S&P BSE Small-Cap index dropped 0.39%. Both these indices underperformed the Sensex.

The breadth, indicating the overall health of the market, was negative. On the BSE, 1,014 shares declined and 679 shares rose. A total of 54 shares were unchanged.

Sun Pharmaceutical Industries rose 0.9% after the company announced that its wholly-owned subsidiaries have reached an agreement with Ironwood Pharmaceuticals, Inc. and Allergan plc (together known as the companies) to resolve the patent litigation regarding submission of an abbreviated new drug application (ANDA) for a generic version of Linzess (Linaclotide capsules) in the US. The announcement was made after market hours yesterday, 16 January 2018.

Pursuant to the terms of the settlement, the companies will grant the wholly owned subsidiaries of Sun Pharma, a license to market a generic version of Linzess in the United States beginning 1 February 2031 (subject to US drug regulator's approval) or earlier under certain circumstances. As a result of the settlement, all Hatch-Waxman litigation between Sun Pharma and the companies, regarding the Linzess patents, will be dismissed. Additional details regarding the settlement were not disclosed. The agreement is subject to customary regulatory approvals.

Hindustan Unilever fell 0.09% ahead of its Q3 results today, 17 January 2018.

Zee Entertainment Enterprises dropped 0.5% ahead of its Q3 results today, 17 January 2018.

Overseas, Asian stocks stepped back from a record high as the region's resource shares were dented by falling oil and commodity prices while digital currencies tumbled on worries about tighter regulations.

Japanese orders for machinery surged to their highest level in a decade in November. Cabinet Office data showed core orders, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, grew 5.7% in November from the previous month.

US benchmark indices pulled back from lifetime highs set earlier in the session to end mostly lower yesterday, 16 January 2018, on likely profit booking amid concerns over the possibility of a government shutdown, reports said. On the data front, the Empire State manufacturing survey slipped to 17.7 in January from a revised 19.6 in December, the New York Fed said.

Today's Call:
#Buy Idea Cellular Ltd at around Rs.101-102, SL: Rs.97, for short term Target of Rs.115-117.  Idea Cellular and Vodafone India, which are currently negotiating a merger to create India’s largest telecom operator, are likely to start operating as a single unit from April, Mint reported on 15 January.

#The stock of 3i Infotech Ltd (Rs.7.75) which is currently in the lower circuit broke the immediate support at around Rs.7.90-8. However, it can at best go to Rs.6.75-6.98, from where definitely a bounce would come, if today it does not close above Rs.8. I feel the share of 3i Infotech Ltd may not go two low from here; in view of the buoyancy in the IT stocks following twin reasons of upgradation of ratings for Infosys, Tech Mahindra and HCL Technologies to OVERWEIGHT by of the sector by global brokerage firm Morgan Stanley and a slight depreciation of the INR Vs USD. Yesterday, the Nifty IT index jumped 3.65% to 12,430.95 with 9 out of 10 constituents ending in the green and 1 in the red. There is no apparent reason for the scrip hitting lower circuits, except some chartical (technical) adjustments. Therefore, the medium to long term investors should accumulate in intraday declines.

#Buy Housing Development & Infrastructure Ltd or HDIL, 25th January, '18, CALL of Rs.70, at Re.0.95. T: Rs.2. Housing Development & Infrastructure's (HDIL) Finance Committee of the Board at its meeting held on January 12, 2018, approved the allotment of two crore warrants at an issue price of Rs.70.5 per warrant to Sarang Wadhwan, promoter of the company.
The promoters had also been allotted two crore warrants on November 14, 2017. The total promoter holding as of Q2FY18 was 36.49% out of which 12.1% is pledged. The total promoter shareholding after the exercise of the warrants would rise to ~42%. This is a positive development for the company. Capital infusion by promoters increases the confidence in future prospects of the company.
HDIL as of Q2FY18 had Land reserves of 199.29 mn sq.ft.
HDIL has operations in the Mumbai Metropolitan Region (MMR) with projects in Residential (65%), Commercial and Retail (6.4%) and SRA (28.6%) as of Q2FY18. It is one of the largest land bank owner in MMR region. Management is now focusing more on affordable housing segment through which it plans to launch apartment in Berkeley square (Ghatkopar) with a price range of Rs.50lacs to Rs.1 crore from Jan 2018.

#Buy Dena Bank Ltd at around Rs.25.35, T: Rs.27-29. SL: Rs.23.7.

#Buy Central Bank Ltd at around Rs.74, T: Rs.83, SL: Rs.72.5...Most of the Bank stocks are moving up today. Both the banking counters are likely to follow this trend.

~~with inputs from Capital Market - Live News....
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