A man reads a newspaper outside Chhatrapati Shivaji Terminal in Mumbai, India, on October 5, 2016. (Photographer: Dhiraj Singh/Bloomberg)

All You Need To Know Going Into Trade On March 20

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Stocks in Asia and U.S. equity futures fell, building on losses on Wall Street after a sell-off in technology shares bruised trader sentiment before a key Federal Reserve policy meeting.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.3 percent to 10,084 as of 6:55 a.m.

Short on time? Well, then listen to this podcast for a quick summary of the article!

DayBreak

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

Global Cues

  • Stocks declined globally on Monday as a technology selloff sent the Nasdaq indexes to the steepest losses in six weeks.
  • The yield on 10-year Treasuries were little changed at 2.85 percent, after rising as much as three basis points.

Europe Check

  • European stocks fell, pushed lower by technology companies that tumbled amid reports a political advertising firm retained information on millions of Facebook Inc. users without their consent.
  • The euro climbed 0.4 percent to $1.2341.
  • The British pound climbed 0.7 percent to $1.403, the biggest increase in almost eight weeks.
  • Germany’s 10-year yield was little changed at 0.57 percent, after posting the largest climb in almost two weeks.
  • Britain’s 10-year yield climbed two basis points to 1.44 percent, after seeing the biggest surge in almost 11 weeks.

Asian Cues

  • Japan’s Topix index fell 0.8 percent and the Nikkei 225 Stock Average slid 1.1 percent.
  • Australia’s S&P/ASX 200 Index dropped 0.5 percent.
  • South Korea’s Kospi index fell 0.4 percent.
  • Futures on Hong Kong’s Hang Seng Index retreated 0.7 percent.
  • Futures on the S&P 500 Index fell 0.1 percent and Nasdaq contracts lost 0.4 percent.

Here are some key calendar events coming up this week:

  • The Fed decision and Powell’s news conference come on Wednesday.
  • The Reserve Bank of Australia releases minutes of the March meeting on Tuesday.
  • The Bank of England is expected to keep interest rates and its asset-purchase program unchanged on Thursday. Attention will be on language and the odds for a May hike.
  • Saudi Crown Prince Mohammed bin Salman is expected to meet with President Donald Trump at the White House this week as part of a U.S. visit.
  • Company earnings scheduled for this week include Tencent, FedEx, Porsche, Hermes, PetroChina and Nike.

Commodity Cues

  • West Texas Intermediate crude for April delivery, which expires on Tuesday, dropped 28 cents to settle at $62.06 a barrel on the New York Mercantile Exchange.
  • Brent traded higher at $66.21 per barrel; up 0.2 percent.
  • Gold rose 0.2 percent to $1,317.06 an ounce.
  • Sugar snapped two-day losing streak, ends at 12.9 cents per pound; up 1.9 percent.

Shanghai Exchange

  • Steel trades lower for third day; down 0.4 percent.
  • Aluminium trades higher for second day; up 0.1 percent.
  • Zinc trades lower; down 0.2 percent.
  • Copper trades lower for third day; down 0.5 percent.
  • Rubber trades lower for third day; down 0.8 percent.

Indian ADRs

Stocks To Watch

  • Elpro Internaitonal is looking to sell 1.25 percent equity in PNB Metlife Insurance Company. It currently owns 12.75 percent equity in the company.
  • Binani Industries says Binani Cement will apply to NCLT for insolvency exit and sell assets to UltraTech.
  • BGR Energy Systems wins order worth Rs 87.68 crore from Tamil Nadu Transmission Corporation.
  • Granules gets ANDA approval for Metformin tablets.
  • Inox Wind offer for sale to non-retail gets 122 percent demand for shares offered.
  • Sona Koyo offer for sale to non-retail gets 28 percent demand for shares offered.
  • IndiGo market share at 39.9 percent versus 39.7 percent (MoM).
  • Jet Airways at 16.8 percent versus 16.6 percent (MoM).
  • SpiceJet at 12.4 percent versus 12.6 percent (MoM).
  • GAIL plans pipeline to link Northeast India to National Gas Grid (Bloomberg).
  • Nitesh Estates says discussions with investors for Pune Mall in advanced stage and is expected to conclude by April 30.
  • IFCI says Supreme Court has upheld the sale of the assets of Blue Coast Hotels for recovery of dues.
  • RBI allows raising FPI limit in Future Retail to 49 percent from 24 percent.
  • Religare Enterprises says India Horizon Fund has withdrawn its petition against the company.
  • Prism Cement's JV completes expansion of tiles capacity at Matel plant, Morbi.

Also Read: Air Passenger Traffic Grows Fastest In 13 Months

Bulk Deals

  • TD Power Systems: India Value Fund IV sold 6 lakh shares or 1.8 percent equity at Rs 201 each.
  • GSS Infotech: Elara India Opportunities Fund bought 1 lakh shares or 0.6 percent equity at Rs 67.5 each
  • Samtel Color: ICICI Bank Ltd A/c ICICI Treasury sold 4.29 lakh shares or 0.5 percent equity at Rs 0.45 each.
  • Punjab Alkalies & Chemicals: IDBI Bank sold 5.25 lakh shares or 1.9 percent equity at Rs 36.4 each.

Sintercom India:

  • India Max Investment Fund sold 8 lakh shares at Rs 73.97 each
  • Jagdish Master bought 7 lakh shares at Rs 74 each

Trading Info

  • Igarashi Motors acquisition window for takeover from March 20 to April 4.

Who’s Meeting Whom

  • Shriram City Union Finance to meet Tata Asset Management, CLSA, Nomura & LGM Investments from March 20–23.
  • Endurance Technologies to meet Axis MF on March 20.
  • VERSUST Tillers to meet Centrum, Stewart Investors & Kotak securities from March 21–23.
  • Shoppers Stop to meet Motilal Oswal Securities and Optis Capital on March 26.
  • Cholamandalam Investment & Finance to meet Motilal Oswal securities on March 21.
  • Pfizer to meet IDFC Securities on March 20.

Insider Trades

  • Chambal Fertilizers promoter SIL Investments acquired 1.99 lakh shares on March 16.
  • Omax Auto promoter Varun Mehta sold 12,305 shares on March 16.
  • Kewal Kiran Clothing promoter Kewal Kiran Finance Pvt Ltd acquired 1,500 shares from March 15–16.
  • Archidply promoter Mysore Chipboards acquired 57,000 shares on March 19.
  • Sharda Motor Industries promoter Mala Relan acquired 1,400 shares on March 16.
  • L&T Infotech promoter L&T sold 25,863 shares on March 16.

New Offerings

  • Bandhan Bank IPO subscribed 14.6 times on final day.
  • Hindustan Aeronautics IPO continues on day 3. The issue is subscribed 0.45 times.
  • Karda Construction IPO continues on day 3. The issue is subscribed 1.24 times.
  • Sandhar Technologies IPO continues on day 2. The issue is subscribed 0.02 times.

Rupee

  • Rupee closed at 65.18/$ on Monday from 64.94/$ on Friday.

Top Gainers And Losers

Index Trends

F&O Cues

  • Nifty March Futures closed trading at 10,122.8, premium of 28.8 points from 37 points.
  • March series: Nifty open interest down 3 percent, Bank Nifty open interest up 5 percent.
  • India VIX ended at 15.8, up 4 percent.
  • Max open interest for March series at 10,500 call strike (open interest at 66 lakh, up 13 percent).
  • Max open interest for March series at 10,000 Put (open interest at 62.9 lakh, up 36 percent).

F&O Ban

  • In ban: BEML, Dewan Housing, HDIL, IDBI Bank, JP Associates, Reliance Communications, SAIL.
  • New in ban: Reliance Communications.
  • Out of ban: Bank of India, TV18 Broadcast.

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

Put-Call Ratio

  • Nifty PCR at 1.04 from 1.09.
  • Nifty Bank PCR at 0.99 from 1.02.

Stocks Seeing High Open Interest Change

Fund Flows

Brokerage Radar

Morgan Stanley on Metals

  • Hindalco: Downgraded to ‘Equalweight’ from ‘Overweight’; cut price target to Rs 256 from Rs 292.
  • Vedanta: Maintained ‘Overweight’; cut price target to Rs 386 from Rs 395.
  • Coal India: Maintained ‘Underweight’; raised price target to Rs 245 from Rs 221.
  • Vedanta benefits from strong volume growth in aluminium and zinc.
  • Hindalco’s earnings are geared to aluminium prices; Volumes have peaked.
  • Upside risk to Coal India’s earnings is less likely.

Motilal Oswal on Shilpa Medicare

  • Maintained ‘Buy’ with a price target of Rs 749; implying a potential upside of 53 percent from the last regular trade.
  • Issuance of EIR by U.S. FDA comforting.
  • EIR lowers regulatory risk over medium term.
  • Strong oncology ANDA pipeline pending for approval.
  • Oncology API and CRAMS on steady track.
  • Expect revenue and net profit to compound at a rate of 16 percent and 35 percent respectively over the fiscal 2017-2020.

Credit Suisse on Zee Entertainment

  • Maintained ‘Outperform’ with a price target of Rs 650.
  • Digital platform Zee5 launched with differentiated content.
  • Await response to Zee5.
  • Advertising growth remains strong.
  • Subscription income should grow mid-teens.
  • Regional remains a key focus area.
  • Operating margins to remain strong.

CLSA on SBI Subsidiaries Meet

  • Subsidiaries scaling up well.
  • Potential listing can unlock value.
  • Subsidiaries are seeing healthy growth – better than parent.
  • Listing of AMC/others can unlock value.
  • Insurance – Large in life, but smaller in general.
  • SBI Card – among the fastest-growing companies.
  • SBI Funds – Growing, but lags on profitability.

CLSA on HCL Tech

  • Maintained ‘Buy’ with a price target of Rs 1,170.
  • Building HCL into a next gen IT services business.
  • Revenue trajectory to remain robust.
  • Organisational structure aids agility.
  • Strategic bet on IP licensing in the creation of its own IP.
  • Valuations attractive; Top pick in sector.
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