Cyclists pass pedestrians as they cycle along a road in China. (Photographer: Qilai Shen/Bloomberg)

All You Need To Know Going Into Trade On June 22

Asian stocks fell, extending the worst week for regional equities since late March, amid concern global trade restrictions will curb growth.

Japan’s Topix index brought this week’s decline to more than 3 percent, while equities also dropped in South Korea and Australia. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded 0.2 percent lower at 10,710 as of 6:55 a.m.

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

U.S. Market Check

  • U.S. stocks fell following declines in Asia and Europe as Daimler AG’s profit warning fed into investor concern over the outlook for global trade and growth.
  • The yield on 10-year Treasuries steadied at 2.90 percent.

Also Read: White House Split Over Hardline Response to China Trade War

Europe Market Check

  • European stocks fell to the lowest since late April as concerns over rising protectionism resurfaced.
  • The euro held at $1.1607.
  • The pound bought $1.3248.
  • Britain’s 10-year yield slipped two basis points to 1.28 percent.
  • Italy’s 10-year yield rose 18 basis points to 2.72 percent, a one-week high.

Asian Cues

  • Japan’s Topix index fell 0.9 percent.
  • Australia’s S&P/ASX 200 index lost 0.1 percent.
  • South Korea’s Kospi dropped 0.5 percent.
  • Futures on the Hang Seng were down about 1 percent.

Also Read: China's Property Market Seen Most at Risk as Cash Squeeze Hits

Commodity Cues

  • West Texas Intermediate was at $66 a barrel.
  • Brent crude traded 1.4 percent higher at $74.09 a barrel.
  • Aluminium ended 0.6 percent higher at $2,195 per metric ton.
  • Gold was little changed at $1,267.73 an ounce.

Indian ADRs

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Here are some key events coming up this week:

  • OPEC countries meets in Vienna today.
  • Flash PMIs will be released in Germany, France and for the euro-zone.

Stocks To Watch

  • Tata Steel: Thyssenkrupp works council cautioned against hasty Tata deal. (Bloomberg)
  • HCL Technologies: Signed a five-year global IT infrastructure and application services deal with Nokia.
  • AstraZeneca received marketing permission for Durvalumab (ImfinziTM) in India.
  • Strides Shasun's rectal artesunate product received WHO pre-qualification.
  • KPIT Technologies and Kinetiq announced strategic life sciences collaboration.
  • Oberoi Realty allotted 2.4 crore equity shares at Rs 500 each via QIP to investors including Fidelity, Goldman Sachs etc.
  • Karnataka Bank set export credit target of Rs 2,900 crore to support export sector.
  • Havells to acquire remaining 31 percent stake in subsidiary Promptec.
  • Tata Motors plans to launch around 50 commercial vehicles this fiscal.
  • Nalco, Hindustan Copper to form JV to buy lithium mines.
  • Som Distilleries arm received approval for manufacturing of Indian-made foreign liquor.
  • JSW Steel may bid for ArcelorMittal’s Romanian plant. (Reuters)

Bulk Deals

Adani Ports

  • Promoter Gautam S Adani Family Trust sold 4.99 crore shares or 2.4 percent equity at Rs 369.65 each.
  • Promoter Pan Asia Trade and Investment Private Limited sold 52.08 lakh shares or 0.25 percent equity at Rs 369.65 each.
  • Europacific Growth Fund bought 3.81 crore shares or 1.8 percent equity at Rs 369.65 each.
  • Capital Research and Management Co A/C New World Fund Inc bought 74.75 lakh shares or 0.4 percent equity at Rs 369.65 each.
  • American Funds Insurance Series A/C International Fund bought 57.62 lakh shares or 0.3 percent equity at Rs 369.65 each.

Who’s Meeting Whom

  • Balaji Tele to meet Franklin Templeton MF, Sundaram MF and others on June 22.
  • PSP Projects to meet investors from June 22-25.

Insider Trades

  • Centrum Capital promoter BG Advisory Services LLP acquired 3.80 lakh shares on June 19.
  • Sarda Energy & Minerals promoter Chhatisgarh Investments Limited acquired 90,000 shares on June 20.
  • Waterbase promoter Karam Chand Thapar & Bros. (Coal Sales) Ltd acquired 49,229 shares on June 19.

(As reported on June 21)

Trading Tweaks

  • Tree House Education circuit filter revised to 10 percent.
  • DCM Financial Services shifted to B group.
  • Uniply Industries last trading day before stock split.

Offerings

  • Fine Organic Industries IPO continues on day 3. Issue subscribed 0.39 times on day 2.
  • RITES IPO continues on day 3. Issue subscribed 2.11 times on day 2.
  • Second tranche of Bharat-22 ETF closes today.

Also Read: Oil Prices A Risk For Bharat-22 ETF, Says Top Fund Manager

Rupee

  • Rupee closed at 67.99/$ on Thursday versus 68.08/$ on Wednesday.

Top Gainers And Losers

F&O Cues

  • Nifty June futures ended trade at 10732, premium of 9 points.
  • Max open interest for June series at 11,000 Call, open interest at 53 lakh.
  • Max open interest for June series at 10,700 Put, open interest at 48 lakh.

F&O Ban

  • In ban: DHFL, Jaiprakash Associates, Infibeam, CG Power.
  • New in ban: CG Power
  • Out of ban: Jet Airways

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 1.48 from 1.56.
  • Nifty Bank 0.78 from 1.05.

Fund Flows

Brokerage Radar

Motilal Oswal on ICICI Prudential

  • Initiated ‘Buy’ with a price target of Rs 480.
  • Growth leadership to sustain; operating metrics improving.
  • Rising share of protection business to further boost margins.
  • Product innovation to drive market share gains, boost profitability.
  • Well-positioned to deliver long-term growth.
  • Valuations attractive; improving return ratios to drive rerating.
  • Bull case price target of Rs 560.

Angel Broking on Amber Enterprises

  • Initiated ‘Buy’ with a price target of Rs 1,272; implying a potential upside of 32.5 percent from the last regular trade.
  • Amber in a sweet spot with favourable industry trends.
  • Lower penetration in India provides huge opportunity.
  • Recent Acquisitions to further boost its manufacturing capabilities.
  • Reduced interest cost and limited capex to boost profits.
  • Valuations are cheap; recent correction provided a very good entry point.

Goldman Sachs on ICICI Bank

  • Maintained ‘Buy’ with a price target of Rs 375.
  • Removed from conviction list given continued uncertainty around CEO.
  • Fundamentals story remains intact.
  • Bear case provides sufficient cushion.
  • See ahead-of-the-curve NPL clean up compared to peer bank.

Jefferies on Tata Steel

  • Maintained ‘Hold’; cut price target to Rs 584 from Rs 614.
  • May be willing to adjust deal terms given recent divergence in margins.
  • May be keen to push through the JV as net debt rising.
  • Stronger GBP, EUR likely affected Tata Steel Europe margins in March quarter.
  • Current quarter’s margins to be strong for both India and Europe.

Axis Cap on Shoppers Stop

  • Maintained ‘Buy’; raised price target to Rs 650 from Rs 620
  • Management reiterated its focus on core departmental store format.
  • Plans of achieving 6-8 percent SSSG over the next 2-3 years.
  • Private labels, cosmetics to drive SSSG.
  • To increase share of private brands through refreshed product range.
  • To strengthen leadership position in beauty and cosmetics portfolio.

HSBC on Alkem Labs

  • Maintained ‘Hold’; cut price target to Rs 2,030 from Rs 2,100.
  • India outlook for mid-teen sales growth in medium term intact.
  • US sales remain dynamic amid ongoing pricing erosion and competition pressure.
  • Resolution of FDA Form 483 at Daman facility will be key stock catalyst.

IIFL on Gujarat Gas

  • Maintained ‘Buy’ with a price target of Rs 875.
  • Well placed to register 12 percent volume growth p.a. over FY18-20.
  • Focus on quality conscious over price sensitive segments.
  • Sector-beating earnings growth but valuations not cheap.

IDFC on Cipla

  • Maintained ‘Outperform’ with a price target of Rs 639.
  • US business gaining momentum with two new approvals.
  • Niche injectable product approvals meaningful given low U.S. base.
  • Comfort on ability to grow its US business at a rate faster than most large peers.
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