Thursday, February 15, 2018

Market Pulse
Key benchmark indices remained firm in early afternoon trade as firmness in Asian stocks boosted sentiment. At 11.45 am the Sensex was seen at 34,381.79 up 225.84 points  or 0.66%, while the  Nifty was seen at 10,570.10 up 69.20 or 0.66%.

Among secondary indices, the S&P BSE Mid-Cap index rose 0.24%. The S&P BSE Small-Cap index gained 0.01%. Both these indices underperformed the Sensex.

The breadth, indicating the overall health of the market, was turned negative from positive in mid-morning trade. On the BSE, 1,278 shares fell and 1,226 shares rose. A total of 109 shares were unchanged.

IT stocks gained. Tech Mahindra was up 0.51%, HCL Technologies 0.62%, Infosys 2/39%, and TCS 0.57%. However, Wipro fell 0.34%.

Telecom stocks were mixed. Bharti Airtel fell 0.16%, Tata Teleservices (Maharashtra) 0.15%, and Reliance Communications dropped 0.85%. Idea Cellular gained 0.47% and MTNL rose 0.2%.

Punjab National Bank skidded 5.9% to Rs 137.20, with the stock extending yesterday's losses triggered by the bank detecting a $1771.69 million fraud at a single branch in Mumbai. The bank made the announcement before trading hours yesterday, 14 February 2018. Shares of PNB slumped 9.81% to settle at Rs 145.80 yesterday, 14 February 2018.

The bank had announced that it has detected some fraudulent and unauthorised transactions (messages) in one of its branch in Mumbai for the benefit of a few select account holders with their apparent connivance. Based on these transactions, other banks appear to have advanced money to these customers abroad. In the bank these transactions are contingent in nature and liability arising out of these on the bank shall be decided based on the law and genuineness of underlying transactions. The quantum of such transactions is $1771.69 million (approximately). The matter is already referred to law enforcement agencies to examine and book the culprits as per law of the land. The bank said it is committed to clean and transparent banking.

On the macro front back home, the government will announce inflation data based on wholesale price index (WPI) for January 2018 today, 15 February 2018. Wholesale prices in India rose by 3.58% year-on-year in December of 2017.

Overseas, Asian stocks gained taking cues from the rally on Wall Street overnight following the release of stronger-than-expected US inflation data. The consumer price index in US rose 0.5% last month, topping the forecast. Other economic data released overnight included US retail sales for the month of January, which missed expectations. Retail sales decreased 0.3% last month.

It is a shortened week for greater China markets, with mainland China markets remaining closed from 15 to 21 February 2018 and Hong Kong markets shut from 16 to 19 February 2018 for the Lunar New Year. Markets in South Korea, Taiwan and Vietnam are closed today for the Lunar New Year holiday.

Today's Calls:
#TV Vision Ltd (Rs.19) seems to have bottomed out around the current market price. The company is generating good revenues from a bouquet of 5 channels. It is expected to cut its expenditure in future, which will help improve its bottomline.  If you look at the December, '18 quarter results you would find that it has a profit of around Rs.16 lakhs before the depreciation. Demonetization had a very bad effect on its revenues, however the things are improving for better, according to my sources, who refused to be quoted. It is from the famous SAB TV Group and  hence there is no much worry regarding its pedigree. We can look forward for a short term target of Rs.29, within the next couple of months.

#3i Infotech Ltd is consolidating around the current price ranges of Rs.6-7, before the next level  of upmove which will take it around Rs.12-14. This is a turnaround company and is expected to give good returns over a period. 

#HDIL (Rs.52.70) has come up with decent set of numbers for the Q3FY18, when on standalone basis the net profit came at Rs.19.18 crore (Rs.13.89). Therefore, it somewhat proves that whatever be the general condition of the real estate market, big players will manages to do well going forward too; because housing is a basic need of human beings. I don't think that the shares will close below Rs.53 today.

#Buy Havells Ltd on declines at around Rs.521, SL: Rs.511,  T: Rs.541 on  T+2 basis. This is a pure chart based call.

#Important: There is a general sell off in the market, especially in the mid and small cap space, after PNB Ltd's scam hit the sentiments of the bulls in the Indian bourses. This is the biggest one after Vyapam scam, which rocked the NDA's boat earlier. And this one too will definitely give sleepless nights to Narendra Modi & Co in the days to come. 
Therefore, don't put fresh money in the stocks. If you have invested fresh fresh funds today, then sell out the day's position and stay with cash. The markets could fall further, as I feel scam-stars might have imitated PNB's methodology, in other banks too, in order to defraud their respective banks. Till the situation in Dalal Street becomes more fluid, my suggestion would be: not venture in this terrain. The Premium Members were already alerted of this possible fall-out this scam. 

~with inputs from Capital Market - Live News
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