A cashier examines Indian rupee banknotes at the Mayuresh Watches and Traders watch and mobile phone store in the Byculla area of Mumbai. (Photographer: Dhiraj Singh/Bloomberg)  

All You Need To Know Going Into Trade On June 12

Asian stocks traded mixed and the dollar rose as investors looked beyond weekend trade ructions to focus on the three major central bank meetings this week and Tuesday’s historic summit between President Donald Trump and North Korea’s leader (live updates here).

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded 0.1 percent lower at 10,784 as of 6:50 a.m.

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BQ Live

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

U.S. Market Check

  • U.S. equities shrugged off the weekend’s trade drama as investors started a hectic week during which three major central banks set interest rates, President Donald Trump meets North Korea’s leader and Brexit returns to the fore.
  • The yield on 10-year Treasuries rose less than one basis point to 2.96 percent.

Europe Market Check

  • European stocks closed higher yesterday after Italy’s finance minister assured markets that the country has no intention of leaving the euro area.
All You Need To Know Going Into Trade On June 12

Asian Cues

  • The MSCI Asia Pacific Index rose 0.1 percent.
  • Topix index rose 0.7 percent.
  • Kospi index rose 0.1 percent.
  • Australia’s S&P/ASX 200 Index rose 0.1 percent.
  • Futures on the S&P 500 Index rose less than 0.05 percent.

Commodity Cues

  • West Texas Intermediate crude rose less than 0.05 percent to $66.13 a barrel.
  • Brent crude traded little changed at $76.47 a barrel.
  • Gold declined 0.2 percent to $1,297.57 an ounce.
  • LME copper fell 0.7 percent to $7,202.00 per metric ton.
  • Aluminium traded 0.3 percent higher at $2,308 per MT.

Fuel Price Update

Petrol and diesel prices were cut by 15 paise and 11 paise respectively today. Petrol now costs Rs 84.26 in Mumbai and diesel costs Rs 72.24, according to the data available on Indian Oil Corporation Ltd.’s website.

Stories You Might’ve Missed

Here are some key events coming up this week:

  • President Donald Trump and North Korean leader Kim Jong Un meet for an historic summit in Singapore Tuesday, which will be late Monday in New York.
  • U.K. Prime Minister Theresa May faces votes that could derail her Brexit policy, also Tuesday.
  • The Federal Reserve is expected to raise interest rates Wednesday as the U.S. economy remains solid.
  • The European Central Bank rates decision comes Thursday with a briefing from President Mario Draghi.
  • The Bank of Japan June monetary policy decision and news conference is Friday.
  • FIFA expects more than 3 billion viewers for the World Cup that begins this week in Russia.

Datawatch

  • 5:30pm: India May retail inflation, estimate 4.9 percent, prior 4.58 percent.
  • 5:30pm: India April Industrial Production YoY, estimate 5.9 percent, prior 4.4 percent

Stocks To Watch

  • Infosys voluntarily delists its ADR from Euronext Paris, London due to low trading volumes.
  • Fortis Healthcare board defers financial results to June 25.
  • Tata Motors: JLR moves production of Discovery from Solihull plant to Slovakia.
  • Usha Martin mulls sale of steel business to deleverage balance sheet.
  • Hotel Leela Venture to issue 125 crore shares to JM Financial ARC.
  • DCB Bank increases MCLR by 10 basis points across all tenures.
  • Orchid Pharma received EU GMPS certificate on inspection of its API plant in Tamil Nadu.
  • DCM Shriram mulls share buy back option.
  • KDDL to raise FPI/FII Limit up to 49 percent and to raise Rs 30 crore via equity.
  • Welspun Corp received order for 33 KMT of pipes for oil and gas project in America.
  • Strides Shasun received U.S. FDA approval for generic Tamiflu capsules for the U.S. market.
  • Data of submission of binding bids for Fortis Healthcare extended to June 28.
  • ICICI Bank says there is no specific communication received from U.S. SEC upto this date in relation to the allegations in respect of Chanda Kochhar.

Indian ADRs

All You Need To Know Going Into Trade On June 12

IPO Watch

  • Rites Ltd.'s Rs 466.2 crore IPO to open on June 20 with a price band of Rs 180-185. The government is planning to divest 12.6 percent equity valuing the company at Rs 3,700 crore.

Top Gainers And Losers

Who’s Meeting Whom Today

  • Voltas to meet IIFL, SBI Caps and other investors on June 12.
  • Blue Star to meet Alchemy Investment on June 12.
  • BSE Ltd. to meet investors from June 12-14.

Insider Trades

  • Aarti Drugs promoter Prakash M Patil acquired 8252 shares from June 5- 6.
  • Mercator promoter Harish Kumar Mittal acquired 20,000 shares on June 8.
  • Lincoln Pharma promoter acquired 50,000 shares on June 8.

(As reported on June 11)

Money Market Check

  • Rupee ended at 67.42 against the dollar on Monday versus 67.50 in previous session.

F&O Cues

  • Nifty June futures closed trading at 10,785.8 discount of 1 point versus 19.5 points.
  • June series-Nifty open interest up 4 percent and Bank Nifty open interest up 1.4 percent.
  • India VIX ended 13.1, up 3.8 percent.
  • Max open interest for June series at 11,000 Call, open interest at 39.3 lakh, open interest down 8 percent.
  • Max open interest for June series at 10600 Put, open interest at 49.5 lakh, open interest up 1 percent.

F&O Ban

  • Dewan Housing
  • Balrampur Chini
  • Jet Airways

Alert: 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 1.53 versus 1.49
  • Nifty Bank PCR at 0.89 versus 0.80

Fund Flows

All You Need To Know Going Into Trade On June 12

Brokerage Radar

CLSA on Indian Pharma

  • Investments in differentiated products began 3-4 years ago.
  • Differentiated portfolio strategy has crystallised substantially over the years.
  • Sun Pharma provides highest visibility on pipeline monetisation.
  • Strong execution from Sun can lead to rerating.

Goldman Sachs on Steel

  • Steel spreads remain resilient despite cost increase.
  • Expect spreads to cool off from current levels but remain above mid-cycle levels.
  • JSW Steel will benefit from robust spreads and upward revisions of earnings.
  • JSW Steel: Maintained ‘Buy’; raised price target to Rs 390 from Rs 360.

HSBC on GAIL (India)

  • Maintained ‘Hold’; raised price target to Rs 355 from Rs 325.5.
  • Positives: improving transmission profitability, lower U.S. LNG contract and rising petchem volumes.
  • Next trigger is decision on unified tariff.
  • Raise earnings estimates for the current and the next financial year by 8 percent each.

Kotak on Max Financial

  • Maintained ‘Buy’ with a price target of Rs 650.
  • Max Life pulls out of IDBI Federal Life Insurance deal ending the overhang.
  • High probability for Max-Axis deal to extend beyond March 2021.
  • Expect positive near-to-medium term stock performance.

Nomura on Dr. Reddy’s

  • Maintained ‘Buy’ with a price target of Rs 2,704.
  • gSuboxone launch in the near term likely.
  • Earnings impact to depend on competitive landscape; Likely to be limited for three years.
  • Expect annualised EPS impact at Rs 62.5 with no additional generics.
  • With competition intensifying EPS contribution to fall to Rs 2.5.

Kotak on Axis Bank

  • Maintained ‘Add’ with a price target of Rs 600.
  • Weakness on most metrics; Underwriting gradually improving.
  • Beginning FY19 with lot more optimism than in past four years.
  • Key issue for the current financial year would be the change in senior management.

Kotak on Tata Steel

  • Maintained ‘Add’; cut price target to Rs 710 from Rs 750.
  • Acquisitions and European JV to result in major shift in financials.
  • India acquisitions—leverage high, but manageable.
  • Expect net-debt/EBITDA to drop to 3.7 times in two years.
  • Price target cut as Bhushan financials incorporated.