Winning Strokes: Think Different

Equity benchmarks gave up early gains and ended lower, extending losses for third straight day. Selling in major sectors such as banks and FMCG weighed on the indices. The rupee hovering near its record low spooked investors.

The Sensex fell 169.45 points or 0.45% to settle at 37,121.22, its lowest closing level since 26 July 2018. The index rose 239.96 points, or 0.64% at the day's high of 37,530.63. The index fell 227.98 points, or 0.61% at the day's low of 37,062.69.

The Nifty 50 index fell 44.55 points or 0.39% to settle at 11,234.35, its lowest closing level since 26 July 2018. The index rose 53.15 points, or 0.47% at the day's high of 11,332.05. The index fell 68 points, or 0.60% at the day's low of 11,210.90.

Among secondary barometers, the BSE Mid-Cap index fell 0.72%. The BSE Small-Cap index fell 0.98%. Both these indices underperformed the Sensex.

The market breadth, indicating the overall health of the market, was weak. On BSE, 968 shares rose and 1704 shares fell. A total of 173 shares were unchanged.

Among the sectoral indices on BSE, the S&P BSE Metal index (up 1.25%), the S&P BSE Oil & Gas index (up 0.98%), the S&P BSE Basic Materials index (up 0.20%), the S&P BSE IT index (up 0.15%), the S&P BSE Energy index (up 0.14%), the S&P BSE Teck index (up 0.07%), the S&P BSE Capital Goods index (down 0.06%), the S&P BSE Industrials index (down 0.16%), the S&P BSE Utilities index (down 0.32%) and the S&P BSE Auto index (down 0.42%), outperformed the Sensex. The S&P BSE Telecom index fell 0.45%, matching the Sensex fall in percentage terms. The S&P BSE Bankex (down 0.51%), the S&P BSE Power index (down 0.52%), the S&P BSE Healthcare index (down 0.59%), the S&P BSE Consumer Durables index (down 0.8%), the S&P BSE Consumer Discretionary Goods & Services index (down 0.82%), the S&P BSE Realty index (down 0.96%), the S&P BSE Finance index (down 1.01%) and the S&P BSE FMCG index (down 1.09%), underperformed the Sensex.

Shares of asset management companies slumped on fears of the impact on their revenue and profitability after the Securities and Exchange Board of India (Sebi) reduced the total expense ratio.

HDFC Asset Management Company declined 8.55% to Rs 1,408.55. Reliance Nippon Life Asset Management slumped 11.28% to Rs 190.

Sebi on Tuesday capped the total expense ratio (TER) for fund houses with equity assets up to Rs 50000 crore at 1.05%, down from as much as 1.75% charged earlier. AMCs with lower assets under management (AUM) will be allowed to charge a higher TER, based on slabs. Sebi also said the industry would have to move to a full “trail model” for commissions. It also capped fees for exchange-traded funds (ETFs) at a maximum of 1%.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 72.575, compared with its close of 72.9775 during the previous trading session.

Asian stocks rose across the board on Wednesday as expectations that Beijing would implement stimulus to soften the economic blow from the Sino-US trade war helped Chinese shares rally.

China announced tariffs targeting more than 5,000 US products, worth about $60 billion, will go into effect on 24 September 2018. However, China will put a 10% tariff on some goods it had previously earmarked for a 20% levy. At the same time, China's commerce ministry said that it filed a complaint to the World Trade Organization (WTO) against the US.

Beijing's announcement came after the Trump administration said the US will impose 10% tariffs on $200 billion worth of Chinese imports, and those duties will rise to 25% at the end of the year.

US stocks came off earlier highs but still closed higher on Tuesday as investors shrugged off escalating trade tensions to instead focus on the robust economy.

In the global commodities markets, Brent for November 2018 settlement was down 14 cents at $78.89 a barrel. The contract had fallen 98 cents, or 1.24% to settle at $78.05 a barrel during the previous trading session.

#ARSS Infrastructure Projects Ltd touched Rs.29.15, in the BSE before closing at Rs.28.85. The company has a good order book and is constantly getting new ones from various agencies. Its Q1FY19 loss came at Rs.10.70 crore versus a loss at Rs.15.12 crore in Q1FY18. Its revenue however fell to Rs.135.40 crore versus Rs.312.4 crore (YoY). Accumulate the shares of the company in intraday dips for medium term targets of Rs.36-41.

In January 2016, the government approved the Hybrid Annuity Model for highway projects. Under the Hybrid Annuity Model, 40% of the construction cost in a highway project is given by state-run NHAI, while developers will have to arrange for 60% project cost. ARSS Infrastructure Projects Ltd is a construction and contracting company with main presence in Railway and Roadwork. The company is commanding better PAT margin due to its focus largely on Railway projects, where the NIM is high. 

The IPO of ARSS Infrastructure Projects made a strong debut on the domestic bourses in March, 2010 gaining nearly 67%. The shares of ARSS Infrastructure Projects which was issued at Rs.450 per equity shares got listed on the NSE at a premium of 40% or at Rs.630 and further soared to hit an intra-day high of Rs.751.80 before ending the trading session at Rs.750. 

#The shares of Vijaya Bank today made a comeback to Rs.57.60 before closing at Rs.52.70. It is a better placed bank and would do well in the coming days, as it gets merged with Bank of Baroda. It fell with low volume today and is likely to give a bounce from the CMP. Accumulate!! 

#The stock of Magadh Sugar and Energy Ltd which was recommended to the Premium Members at Rs.106.80 on last Sunday today hit the Upper Circuits. The stock had given huge returns to the Premium Members in just 4-days. For targets and other details, you need to join the Premium Services. 

#Complete profit booking was suggested for the scrips of Rana Sugars Ltd (Rs.5.20) which made an intraday high of Rs.5.45 and Bajaj Hindustan Sugars Ltd (Rs.11.57) which made an intraday high of Rs.12.07 in the BSE. 

#Profit booking was suggested to the Premium Members on the scrip of Kwality Ltd at around the price band of Rs.24-25 some days back. The stock made an intermediate high of Rs.27-plus and is now trading at Rs.17.90. The stock had doubled from the recommended price of around Rs.11-12. However, I feel the share might test its earlier low, before giving a fresh bounce. If you are still holding the same, book complete profits and exit the counter. 

#The stock of 63 Moons Technologies Ltd  (Rs.83.50) today closed near the  days low of Rs.83.10. Yesterday, profit booking was suggested in the counter. With no immediate triggers and the markets on a downtrend, the scrip could fall back to Rs.79-77 ranges. Book complete profits. 

#I will be recommending a momentum counter to the Premium Members next week. If anyone wants to know the name in advance they should either join the Premium Information Service or trade through my associated brokerage house. Now a discount scheme is going on for both the yearly and life-time subscription packages. 

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