A stock broker reacts during market hours in a dealing room in Mumbai (Photographer: Prashanth Vishwanathan/Bloomberg News)

All You Need To Know Going Into Trade On Dec. 28

Stocks in Asia flirted with a record high on Thursday in muted trading after a listless U.S. session overnight offered little direction ahead of New Year holidays.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.3 percent to 10,559 as of 6:50 a.m.

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Here’s a quick look at all that could influence equities on Thursday.

Global Cues

  • U.S. stocks edged higher on Wednesday, amid trading thinned by a holiday-shortened week. The dollar weakened against most peers.
  • 10- year Treasury yields headed for a fourth day of declines, while the dollar traded near month lows.
  • The best year for U.S. equities since 2013 is ending with a bit of a whimper after stocks soared in the week before the holidays as Republicans passed a major overhaul of the tax code.
  • Bitcoin fell below $15,000 after its biggest gain in two weeks took it above $16,000.

Europe Check

  • Stocks in Europe ended slightly higher following a mixed session in Asia.
  • The euro and pound gained, while bonds in Europe were mixed.
All You Need To Know Going Into Trade On Dec. 28

Asian Cues

  • Japan’s Topix index was little changed in early trade, as was the Nikkei 225 Stock Average
  • Contracts on Hong Kong’s Hang Seng Index were also little changed.
  • Futures on the S&P 500 Index were little changed.

Here are some of the key events scheduled for this week:

  • U.S. trade figures are due Thursday.
  • Egypt decides on interest rates.

Commodity Cues

  • Brent crude snapped six-day winning streak; ended lower at $66.44/barrel, down 0.9 percent
  • West Texas Intermediate crude was little changed at $59.61 a barrel.
  • Gold futures were little changed at $1,287.55 an ounce.
  • LME copper futures advanced 1.6 percent to $7,240.00 per metric ton Wednesday, reaching the highest in about four years.
  • Sugar ended near three-week high at 14.9 cents per pound; up 1.6 percent.

Shanghai Exchange

  • Steel trades lower; down 1.4 percent.
  • Aluminium trades higher for second day; up 1.3 percent.
  • Zinc trades higher for second day; up 0.1 percent.
  • Rubber trades lower; down 0.5 percent.

Indian ADRs

All You Need To Know Going Into Trade On Dec. 28

Stocks To Watch

  • Star Cement received Rs 158.82 crore as capital investment subsidy from Central government.
  • Quess Corp acquired Master staffing solutions and 60 percent stake in Golden Star Facilities and Service.
  • Riddhi Siddhi board approved proposal to de-list shares of the company. Promoters set the offer floor price at Rs 510 apiece.
  • SEBI asked Axis Bank to conduct inquiry on leak of unpublished price sensitive financial information within three months.
  • Kolte Patil’s Pune township signed Rs 193 crore agreement with KKR.
  • SBI board approved raising up to Rs 8,000 crore through tier-1 bonds by March.
  • United Bank raised Rs 100 crore through tier-1 bonds.

Bulk Deals

  • Bajaj Auto: Nirav Trust sold 16.69 lakh shares or 0.6 percent equity at Rs 3351.40 each.
  • JHS Svendgaard: Sixth Sense India Opportunities-I sold 3.16 lakh shares or 0.7 percent equity at Rs 74.06 each.
  • Bajaj Finserv: Anant Bajaj Trust sold 9.19 lakh shares or 0.6 percent equity at Rs 5372.14 each.
  • Sintex Plastics: Hypnos Fund sold 30 lakh shares or 0.5 percent equity at Rs 81.01 each.

Bajaj Electricals

  • Madhu Bajaj bought 7.70 lakh shares or 0.8 percent equity at Rs 475 each.
  • Neelima Bajaj Swamy bought 7.90 lakh shares or 0.8 percent equity at Rs 475 each.
  • Anant Bajaj Trust sold 21.80 lakh shares or 2.1 percent equity at Rs 475 each.

Bajaj Holding

  • Nirav Trust bought 21.99 lakh shares or 2 percent equity at Rs 3012.40 each.
  • Anant Bajaj Trust bought 21.65 lakh shares or 1.9 percent equity at Rs 2963.76 each.
  • Kumud Bajaj sold 12.12 lakh shares or 1.1 percent equity at Rs 2987.50 each.
  • Madhu Bajaj sold 18.97 lakh shares or 1.7 percent equity at Rs 2987.50 each.

ADF Foods

  • Kuber India Fund bought 6 lakh shares or 2.8 percent equity at Rs 324 each.
  • Promoter Priyanka Thakkar sold 8 lakh shares or 3.8 percent equity at Rs 324.23 each.

Who’s Meeting Whom?

  • General Insurance Corp met Edelweiss Financial Services on Dec. 27.

Top Gainers And Losers

All You Need To Know Going Into Trade On Dec. 28

Index Trends

All You Need To Know Going Into Trade On Dec. 28

F&O Cues

  • Nifty December futures closed trade at 10500, premium of 9.5 points versus discount of discount of 5 points.
  • Nifty January futures trading at 10,533, premium of 42 points versus premium of 37 points.
  • Across all series: Nifty open interest down 1 percent; Bank Nifty open interest up 0.4 percent.
  • Nifty rollover at 51 percent, Bank Nifty rollover at 44 percent.
  • India VIX ended at 12.4, up 3.6 percent.
  • Max open interest for Dec. series at 10,600 Call (open interest at 54.5 lakh, up 21 percent).
  • Max open interest for Dec. series at 10,000 Put (open interest at 64.4 lakh, down 9 percent).

F&O Ban

  • In ban: Balrampur Chini, DHFL, DLF, GMR Infra, HDIL, IFCI, Jet Airways, Jain Irrigation, JP Associates, Reliance Communications, Reliance Capital, TV18 Broadcast, Wockhardt.
  • New in ban: Reliance Communications, TV18 Broadcast.

Only intraday positions can be taken in stocks which are in F&O ban. In case of a rollover of these intraday positions, there is a penalty.

Put-Call Ratio

  • Nifty PCR unchanged at 1.59.
  • Nifty Bank PCR at 0.94 from 1.17.

Stocks Seeing High Open Interest Change

All You Need To Know Going Into Trade On Dec. 28

Fund Flows

All You Need To Know Going Into Trade On Dec. 28

Brokerage Radar

Motilal Oswal On Mahindra CIE Automotive

  • Initiated ‘Buy’ rating with target price of Rs 297, implying a potential upside of 19 percent from yesterday’s close.
  • Mahindra CIE Automotive is all primed for a growth phase after three years of consolidation.
  • Mahindra CIE Automotive's India (ex BFL) business is focused on fast-growing/recovering segments.
  • A strong, focused and disciplined parent, CIE has instilled financial discipline.
  • The Bill Forge (BFL) acquisition is an excellent strategic fit for Mahindra CIE Automotive.
  • Estimate consolidated revenue to grow at a compounded rate of about 8 percent by 2019.
  • Expect Ebitda margin expansion of about 260 basis points to around 15.1 percent by 2019.
  • Strong earnings growth, limited capex (5-6 percent of sales) to drive improvement in capital efficiencies.

Motilal Oswal On NTPC

  • Maintained ‘Buy’ rating with a price target of Rs 211, implying a potential upside of 19 percent.
  • Revised norms provide relief from low PLF inefficiencies.
  • Three plants had PLF of less than 75 percent in the financial year-ended March 2014, which increased to five plants in the previous financial year.
  • The revised regulatory norms can compensate earnings by about 2 percent, visible in September quarter results.
  • Swapping/flexible coal linkages also a positive since this leads to reduction in landed cost of coal.
  • Expect earnings to grow at a compounded rate of 14 percent over the financial years through March 2020, driven by strong capitalization.
  • Stock could re-rate as return on equity could get a boost from capitalization outpacing the capex.

Ventura On Hyderabad Industries

  • Maintained ‘Buy’ rating with a price target of Rs 1700, implying a potential upside of 21 percent from yesterday’s close.
  • Fiber cement roofing sheets is a cash cow for Hyderabad Industries.
  • Management to launch new product in fiber cement roof segments by March.
  • Hyderabad Industries is planning a capacity expansion in the pipes & fittings segment.
  • See higher contribution from low costing AAC blocks, boards and panels segment.
  • Expect revenue, operating income and net profit to grow at a compounded rate of 12 percent, 21 percent and 22 percent in three years.

Goldman Sachs On Sun Pharma

  • Maintained ‘Buy’ rating and price target at Rs 600, implying a potential upside of 4 percent from yesterday’s close.
  • NDA filing of OTX-101 for Dry Eye Disease in line with expectation.
  • Expect an NDA approval for OTX-101 over the next 12 months.
  • Expect commercialization of OTX drug to follow in the financial year-ending March 2020.
  • Potential generic entry for Restasis could reduce the overall market potential for the drug.
  • Delayed Halol plant resolution timeline, US price erosion intensity a key risk.