Tuesday, February 27, 2018

Pre-Session: Shares may extend gains
27-Feb-18: Market is seen opening higher tracking positive cues from Asian markets. Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could rise 51 points at the opening bell.

Overseas, Asian shares were trading higher following gains on Wall Street overnight. The US market rose on Monday, 26 February 2018, in a broad-based rally led by technology shares. In the latest economic data, US new home sales fell 7.8% in January 2018 from the previous month, to an annualised pace of 593,000, the Commerce Department said.

Investors are focusing on the US Federal Reserve chairman Jerome Powell's congressional testimony on monetary policy and the economy. Powell will testify on the central bank's semi-annual report on monetary policy and the economy on Tuesday, 27 February 2018, before the US House of Representatives' Financial Services Committee.

Closer home, foreign portfolio investors (FPIs) sold shares worth a net Rs 1119.51 crore yesterday, 26 February 2018, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 1409.45 crore yesterday, 26 February 2018, as per provisional data.

Among corporate announcements, Punjab National Bank (PNB) has revealed additional unauthorised transactions related to the scam by billionaire diamantaire Nirav Modi and his uncle and business partner, Mehul Choksi, increasing the estimated size of the fraud by $204.25 million (about Rs 1322 crore). The disclosure was made to stock exchanges late yesterday, 26 February 2018.

ACC and Ambuja Cements announced after market hours yesterday, 26 February 2018, that they are not proceeding with the merger proposed in May last year. There are certain constraints to implementing the merger at present, said the cement majors in separate stock exchange filings. The merger, however, remains the ultimate goal, the companies maintained.

The boards of both companies have approved an arrangement for sale and purchase of materials and services on mutually agreed terms in a bid to maximise synergies and unlock additional value for shareholders, the statements added. ACC and Ambuja Cements will disclose the details of the arrangement to its shareholders when it seeks their nod via postal ballot.

Domestic stocks jumped yesterday, 26 February 2018, tracking positive global stocks. The barometer index, the S&P BSE Sensex, surged 303.60 points or 0.89% to settle at 34,445.75. The Nifty 50 index gained 91.55 points or 0.87% to settle at 10,582.60. Both the Sensex and the Nifty hit 3-week closing high.

Today's Calls:
#Buy the shares of the Tata Motors Ltd at around Rs.375-376, for short term targets of Rs.396-421. Tata Tiago for the first time outsold Maruti Suzuki Celerio and Hyundai Eon to become the eight-largest selling cars in January 2018, according to a data based on SIAM domestic sales.  For Tata Motor Futures, the 1st resistance comes at Rs.379 followed by Rs.384.

#In case of Nifty_Spot, my view is that: as long as it does not break the rock solid support of 10400, the BULLS have nothing much to worry. The large caps will more or consolidate around the current range while the action would be seen in the broader market.

#There is no stopping of P C Jewellers Ltd today as the stock touched Rs.346, intrayday on the news that market watchdog Securities and Exchange Board of India (SEBI) has issued an order against Mumbai-based Abhirati Trading but the order did not hold Vakrangee Limited responsible for any misdeed in the ongoing alleged campaign against the IT company.

#Buy Aban Offshore Ltd at around Rs.173-174, T: Rs.T: Rs.191/206/218. SL: Rs.166. Crude oil started the week with gains thanks to comments from Saudi Arabia’s Energy Minister Khalid al-Falih and reports of a slowdown in exports from Libya’s Mellitah oil terminal.
WTI was trading at US$63.63 a barrel at the time of writing and Brent crude was changing hands at US$66.98, after on Saturday Al-Falih said that Saudi Arabia’s oil production over the first three months of 2018 would be much lower than the amount allowed under the 2016 production cut agreement. Al-Falih added that exports were estimated to average 7 million bpd in the three-month period.
At the same time, the minister said he hoped OPEC and its partners could relax the production restrictions in 2019 and progress on the permanent cooperation framework that was mentioned earlier this year. Following these comments, Brent crude briefly jumped over US$67 a barrel, but later in the day eased down again. U.S. production, near record highs, put a cap on the gains.

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