Traders monitor data during the official opening of the stock trading floor. (Photographer: Andrey Rudakov/Bloomberg)

All You Need To Know Going Into Trade On June 6

Stocks in Asia opened mixed Wednesday as a global rally in risk assets that sent U.S. equities to three-months highs stalled amid a backdrop of protectionism and geopolitical issues.

Equities were little changed in Japan and rose in Australia, while South Korean markets were closed for a holiday.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded 0.2 percent lower at 10,586.5 as of 9 a.m.

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

BQ Live

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

U.S. Market Check

  • The global rally in risk assets that sent U.S. stocks to a 12-week high sputtered on Tuesday, with the S&P 500 swinging between gains and losses before closing higher for a third consecutive day.
  • The yield on 10-year Treasuries fell two basis points to 2.91 percent.

Also Read: Trump and Kim to Meet on Singapore's Sentosa Island Resort

Europe Market Check

  • European shares reversed earlier gains to post a decline as concerns including the new Italian government continued to cloud the equity outlook.
  • The euro rose 0.1 percent to $1.1714.
  • The British pound gained 0.6 percent to $1.3388.
  • Italian 10-year yields surged 25 basis points to 2.79 percent.

Asian Cues

  • Topix index was little changed.
  • S&P/ASX 200 Index rose 0.5 percent.
  • Hang Seng Index futures fell 0.2 percent.
  • S&P 500 Index futures were flat.

Also Read: Ridham Desai On What’s Making The Market Suspicious About Growth

Commodity Cues

  • Brent crude traded flat at $75.33 a barrel.
  • West Texas Intermediate crude increased 0.2 percent to $65.66 a barrel.
  • Gold rose 0.1 percent to $1,297.37 an ounce.
  • Aluminium ended 0.4 percent lower at $2,316.75 per MT.

Fuel Price Update

  • Petrol and diesel prices were cut by 11 paise and 8 paise respectively today. Petrol now costs Rs 85.54 in Mumbai and diesel costs Rs 73.25, according to the data available on Indian Oil Corporation Ltd.’s website.

Stories You Might’ve Missed

  • Indian government has a new, new power sector resolution plan: Here’s how it is expected to work.
  • U.S. quietly asked Saudi and some other OPEC producers to increase output by about 1 million barrels a day.
  • Billionaire David Koch is stepping down from the family’s business and conservative political empire.
  • Janitors are becoming millionaires thanks to this stock’s 9,500 percent rally
  • LeBron is a player... in U.S.-China trade thanks to NBA deals
  • The Subaru set can’t buy a battery-powered version of its favorite car, but they’re not bothered.
  • Trump cannot pardon himself, the U.S. justice department said it is unconstitutional.
  • Just like air travel, now beware of carrying excess luggage while travelling in trains as well. Here’s why.

Here are some key events coming up this week:

  • U.S. trade balance and Australia GDP also out on Wednesday.
  • On Thursday, Japanese Prime Minister Shinzo Abe meets with U.S. President Trump at the White House to discuss the planned U.S. summit with North Korea’s Kim Jong Un.
  • Also on Thursday, euro-zone GDP.
  • Turkey rate decision is due on Thursday.
  • G-7 Leaders’ Summit starts in Quebec Friday through to June 9.

Also Read: Rs 8,000 Crore Package For Sugar Industry On The Anvil, Food Minister Paswan Says

RBI Decision-Day Guide

The Reserve Bank of India is expected to keep interest rates on hold today, but what’s more important is the accompanying statement that could give a signal to investors on future tightening as inflationary pressures rise.

Key taking points:

Stocks To Watch

  • Ram Vilas Paswan says cabinet will consider up to Rs 8,000 crore package for the sugar industry
  • NMDC’s March-May iron ore output and sales at 4.53 million tonnes.
  • United Spirits receives shareholders’ approval for 5:1 stock split.
  • Mcleod Russel to sell certain tea estates of the company in Assam to M.K. Shah Exports for Rs 331 crore.
  • ADF Foods to buyback 10 lakh equity shares (4.71 percent equity) at Rs 300 each.
  • Kirloskar Oil Engines to hike prices of power generator sets by 5-8 percent due to rising raw material costs.
  • Infosys Finacle banking solutions gets Bank Sohar Deal.
  • Nalco sets a capex target of Rs 1,100 crore for 2018-19.

Bharat Forge, Ramkrishna Forgings and GNA Axles in focus as North American Class 8 truck orders for May double over last year

  • North America Class 8 truck orders for May 35,200 units versus 16,419 units last year, up 114 percent.
  • North America Class 8 truck orders for May 35,200 units vs 34,700 units last month, up 1.5 percent.

(Source: FTR)

Indian ADRs

Bulk Deals

  • HCL Technologies: Promoter Vama Sundari Investments (Delhi) Pvt. Ltd bought 75 lakh shares or 0.5 percent equity at Rs 900 each.
  • IEX: Morgan Stanley Mauritius Company Limited sold 1.78 lakh shares or 0.6 percent equity at Rs 1,595 each.
  • Lakshmi Vilas Bank: India Infoline Investment Services Limited bought 1.05 crore shares or 4.1 percent equity at Rs 100.1 each.
  • Career Point: KIFS Enterprise sold 1 lakh shares or 0.6 percent equity at Rs 102.64 each.
  • Indiabulls Real Estate: Indiabulls Real Estate Ltd bought 27 lakh shares or 0.6 percent equity at Rs 175.58 each.

Who’s Meeting Whom

  • Tata Global Beverages to meet several fund houses including Morgan Stanley, Goldman Sachs, Sundaram AMC etc on June 6.
  • Cipla to meet several fund houses including Oaktree Capital Mgmt, Arohi Asset Mgmt etc from June 6 – 8.
  • UFO Moviez to meet Paradise Investment Management and others on June 6 and 7.

Insider Trades

  • Centrum Capital promoter BG Advisory Services LLP acquired 1.83 lakh shares on June 1.
  • Trident Ltd promoter Trident Corp Ltd. acquired 15,789 shares on June 4.
  • Alembic Pharma promoter Alembic Ltd acquired 15,000 shares from June 1–5.
  • Trident Ltd. promoter group Trident Corp Ltd acquired 15,700 shares on June 4.
  • Laurus Labs promoter Dr. Satyanarayana Chava acquired 49,448 shares on May 30.

(As reported on June 5)

Trading Tweaks

  • HDFC Bank and Indusind Bank FII window open.
  • Godawari Power & Ispat placed under additional surveillance measure by BSE.
  • Viaan Industries, Fiberweb and Chartered Logistics circuit filter revised to 10 percent.
  • Gruh Finance ex-date for 1:1 bonus.
  • Akzo Nobel ex-date to determine buyback eligibility.
  • Lumax Auto Technologies last trading day before ex-date for stock split.

Money Market Check

  • Rupee closed at 67.15/$ on Tuesday from 67.11/$ on Monday.

F&O Cues

  • Nifty June Futures closed trading at 10,596.4, a premium of 3.3 points versus discount of 29.8 points.
  • June series-Nifty open interest up 0.6 percent & Bank Nifty open interest down 5 percent.
  • India VIX ended 13.3, down 4 percent.
  • Max open interest for June series at 11,000 Call, open interest at 45.6 lakh, open interest up 15 percent.
  • Max open interest for June series at 10,200 Put, open interest at 35.5 lakh, open interest up 1 percent.

F&O Ban

  • In ban: Dewan Housing
  • New in ban: Dewan Housing

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.

Active Stock Futures

Put-Call Ratio

  • Nifty PCR at 1.33 versus 1.39.
  • Nifty Bank PCR at 0.56 versus 0.60.

Fund Flows

Brokerage Radar

Morgan Stanley on Reliance Industries

  • Maintained ‘Overweight’ with a price target of Rs 1,241.
  • IMO regulation and ramp-up of petcoke gasifiers to add to higher margins.
  • Expect $3/bbl rise in GRMs due to the above levers.
  • Retail pump station expansion should also support growth.
  • Most of the telecom capex done; Company aims to achieve 99 percent coverage by end of 2018.

Morgan Stanley on Godrej Consumer

  • Maintained ‘Overweight’ with a price target of Rs 1,350
  • Strong growth outlook for 2018-19.
  • Gradual improvement in demand currently underway in India
  • In Indonesia plan to seek growth by increasing distribution.
  • In Africa, Godrej expects to benefit from local manufacturing.

Citi on JSPL

  • Maintained ‘Buy’ with a price target of Rs 401
  • Steel business is doing well in the current quarter
  • Angul plant ramping up fast; DRI plant to start in July 2018.
  • Coal supply situation has improved; Co. looking to sign short-term PPAs.
  • Valuation with improving cash flows and EBITDA appear quite attractive.

Jefferies on HEG and Graphite India

  • HEG: Maintained ‘Buy’ with a price target of Rs 4,400.
  • Graphite: Maintained ‘Buy’ with a price target of Rs 1,275.
  • Demand supply tightness continues leading to higher realisations.
  • New contracts signed at higher prices hinting strong current quarter.
  • Remain positive on graphite electrode sector.
  • HEG and Graphite trading at cheap valuations providing good buying opportunity.
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