Tuesday, March 13, 2018

Market Pulse
Key benchmark indices hovered in positive zone in early afternoon trade. 

At 13:35 IST, the barometer index, the S&P BSE Sensex, was  seen trading at 33,999.86 up 81.92 points or 0.24% while the NSE was seen at 10,455.15 up 33.75 or 0.32%.

The Sensex was trading below the 34,000 level after hitting an intraday high above that level in morning trade. Domestic macroeconomic data released after market hours yesterday, 12 March 2018, signalling an economic turnaround boosted the sentiment.

IT stocks declined as the rupee firmed against the dollar. Metal and mining stocks rose. Aviation stocks rose.

Volatility struck bourses in early trade as the key benchmark indices turned positive soon after an initial decline triggered by subdued Asian stocks. Stocks extended gains and hit fresh intraday high in morning trade. Key benchmark indices trimmed some gains in mid-morning trade.

The S&P BSE Mid-Cap index was up 1.02%. The S&P BSE Small-Cap index was up 1.22%. Both these indices outperformed the Sensex.

The market breadth, indicating the overall health of the market, was strong. On the BSE, 1,678 shares rose and 754 shares fell. A total of 124 shares were unchanged.

IT stocks declined as the rupee firmed against the dollar. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports. In the foreign exchange market, the partially convertible rupee was hovering at 64.9625, compared with closing of 65.04 during the previous trading session.

MindTree (down 1.11%), HCL Technologies (down 0.87%), Oracle Financial Services Software (down 0.05%), Tech Mahindra (down 0.31%) and Hexaware Technologies (down 0.29%) fell.

TCS lost 4.75% to Rs 2,907 on reports that that Tata Sons has sold about 2.84 crore shares or 1.5% stake of the company through six block deals in a price range of Rs 2,872 to Rs 2,925 per share on the NSE. Tata Sons held 73.52% stake in TCS (as on 31 December 2017. The money raised from the stake sale will be used by Tata Sons to strengthen its balance sheet, reports added.

Infosys shed 0.07%. Infosys announced its intention to voluntarily delist its American Depository Shares (ADS) from the Euronext Paris and Euronext London exchanges. Infosys ADS will continue to be listed on the NYSE and investors can continue to trade their ADS on the NYSE as before. The announcement was made after market hours yesterday, 12 March 2018.

The primary reason for seeking the proposed delisting is the low average daily trading volume of Infosys ADS on these exchanges, which is not commensurate with the related administrative requirements. During the 5-year period of the company's listing on Euronext Paris and Euronext London, the average daily trading volume of the company's ADS was significantly lower than its average daily trading volume on the New York Stock Exchange (NYSE). The proposed delisting is subject to approval from Euronext Paris S.A. and Euronext London. There will be no change to the Infosys share/ADS count, capital structure and float, as a result of the proposed delisting from the above exchanges.

Metal and mining stocks rose. Hindustan Copper (up 2.39%), JSW Steel (up 0.96%), Tata Steel (up 0.69%), Steel Authority of India (Sail) (up 1.52%), National Aluminium Company (up 0.55%), Hindustan Zinc (up 0.5%), Jindal Steel & Power (up 0.96%) and NMDC (up 0.69%) edged higher. Hindalco Industries (down 0.2%) fell.

Vedanta rose 1.72% to Rs 322.40 after the company's board of directors at its meeting held today, 13 March 2018, declared an interim dividend of Rs 21.20 per share for the financial year ending 31 March 2018. The announcement was made during market hours today, 13 March 2018.

Aviation stocks rose. SpiceJet (up 1.26%) and Jet Airways (India) (up 2.18%) rose.

InterGlobe Aviation rose 0.13%. According to media reports, the Director General of Civil Aviation (DGCA) on Monday, 12 March 2018, grounded a few Airbus A320neo aircraft currently operating in the country due to the ongoing Pratt & Whitney engine issue. DGCA asked IndiGo to ground eight of its A320neo aircraft until further notice.

The civil aviation authority has reportedly said that no concrete proposal has been given by Pratt & Whitney yet on when the engine woes will be resolved. All the grounded A320neo aircraft are fitted with Pratt & Whitney engines, reports added.

InterGlobe Aviation has yet to reply to a stock exchange notice issued late on Monday, 12 March 2018, seeking clarification on the media reports.

Future Consumer jumped 14.26% to Rs 57.70 after a domestic brokerage initiated coverage on the stock with a 'Buy' rating and price target of Rs 76. The brokerage stated in its report that Future Consumer (FCL), an integrated consumer company, is the best play on the huge window of opportunity (presented by a combination of macro factors and company-led initiatives) for brands using modern retail methods of distribution.

In addition, FCL appears best placed among Future Group companies from a revenue, profit and RoCE perspective, given the group's focus on retail expansion to drive growth in its burgeoning brands portfolio. Improving mix and operating leverage are expected to drive significant margin expansion over the next five years, the report added.

Domestic macroeconomic data released after market hours yesterday, 12 March 2018, signalled an economic turnaround. The lower-than-expected CPI inflation and higher-than-expected IIP data will allay fears of an interest rate hike by the Reserve Bank of India.

India's industrial production (IIP) continued to record a strong growth for the third straight month at 7.5% in January 2018 from 7.1% growth in December 2017. The manufacturing sector's production surged 8.7% in January 2018, supporting overall growth in industrial production. The mining output growth slowed down to 0.1% in January 2018, while the electricity generation growth accelerated to five-month high of 7.6% in January 2018, contributing to the improvement in overall industrial production growth in January 2018.

The all-India general consumer price index (CPI) inflation dipped to four-month low of 4.44% in February 2018, compared with 5.07% in January 2018 and at 3.65% in February 2017. The corresponding provisional inflation rate for rural area was 4.37% and urban area 4.52% in February 2018 as against 5.21% and 4.93% in January 2018. However, the core CPI inflation rose marginally to 5.04% in February 2018 compared with 5% in January 2018.

Overseas, most Asian stocks were trading lower ahead of US reading on inflation due today, 13 March 2018, which is likely to give some idea about whether the Federal Reserve will accelerate its pace of rate increases.

In US, the Dow Jones Industrial Average and the S&P 500 index finished lower Monday, 12 March 2018 weighed down by the industrials sector, while the Nasdaq Composite Index closed at a record, in part due to optimism over Friday's jobs data, which showed solid economic growth without triggering wage pressure.

Today's Calls:
#TV Vision Ltd hits the buyer freeze at around Rs.16.80. We can look for targets of Rs.27-29 if Rs.19 is taken out on the upside. Accumulate on dips. 

#The stock of Union Bank of India Ltd is probably heading towards Rs.111-117. You can raise the stop loss to Rs.96 and keep holding. 

#Should you enter into the SCAM TAINTED counter of KSK Energy Ventures Ltd (Rs.9.90)? You need to join the Premium Service to get the answer. 

#Videocon Industries Ltd hit another buyer freeze at Rs.14.70. This stock is going to deliver multi-bagger return going forward, Therefore, don't sell out in a hurry -- however, book profits on the way up.

# The Stock of HDIL recommended to the Premium Members in the morning,  at around Rs.41.60 for short term targets of Rs.44-47,  has hit an intraday high of Rs.46.70, which is almost near the 2nd target of Rs.47. Book some profits and wait for intraday lows to enter.

#Buy the shares of RattanIndia Power Ltd (erstwhile Indiabulls Power Limited) at around Rs.5.7 for a short term target of Rs.9.

#Buy the shares of Apollo Tyres Ltd at around Rs.264, SL: Rs.260, T: Rs.269-272 on T+2 basis. This a pure chart based call.

#SELL Copper at around Rs.451.00 (CMP: Rs.450.95), Stop Loss above Rs.454.10, T: Rs.445.00 on T+1) basis....

#The stock of P C Jewelers Ltd (Rs.379.80) recommended several times in this blog is on fire today, up more than 10%.  

#Join the Premium  Service or trade through my recommended brokerage house with a minimum portfolio size of Rs.3 lakhs to stay ahead of other. This blog only gives an outline of what is sent to Premium Members and hence if you want a complete guidance, then you need to look for Paid Subscription based Service. 
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