All You Need To Know Going Into Trade On Aug. 30
Employees work at their desks in a brokerage firm in Mumbai, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

All You Need To Know Going Into Trade On Aug. 30

Stocks in Asia tracked a U.S. rally after China indicated it wouldn’t immediately retaliate against the latest American tariff increase. Shares in Tokyo, Sydney and Seoul advanced on the final trading day of a tumultuous month dominated by the trade war

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded little changed at 11,006 as of 7:20 a.m.

Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.

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

  • The S&P 500 Index rose for a second day after a spokesman for China’s commerce ministry said that escalating the conflict won’t benefit either side and that it was more important to discuss removing the extra duties.
  • The dollar held near a two-year high. Japanese bonds slipped after the Bank of Japan cut purchases in its regular operations.
  • U.S. economic growth slowed in the second quarter by more than initially reported, on weaker readings for categories including exports and inventories.
  • Oil headed for its biggest weekly gain since mid-July after a sizable drop in American crude inventories and an apparent pause in U.S.-China trade hostilities eased demand fears.

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Also read: What If There Was a Trade War Truce?

Brokerage Radar

Morgan Stanley on Axis Bank

  • Maintained 'Overweight'; cut target price to Rs 975 from Rs 1,100.
  • Cut financial years 2019-20/2020-21 EPS estimates by 8/10 percent due to higher credit cost.
  • Flow of bad loans in India has increased; Axis should see some rise in bad loans.
  • Core pre-provisioning operating profit trend should stay strong; valuations attractive.

UBS on Bharat Electronics

  • Maintained 'Sell' with target price of Rs 89.
  • Defence revenue growth to decelerate in second half of current financial year.
  • Ebitda margin strong in recent quarters; difficult to sustain.
  • Valuation de-rating to continue.

Citi on Maruti Suzuki

  • Maintained 'Buy' with target price of Rs 7,400.
  • Cut financial years' 2020-22 earnings estimates by 7-14 percent, on account of cut in volumes and lower margins.
  • If festive season below expectations, further big production cuts could be required to liquidate inventories.
  • More demand for Bharat Standard-VI products due to confusion surrounding Bharat Standard-IV products.

UBS on SBI Life Insurance

  • Maintained 'Buy'; hiked target price to Rs 980 from Rs 860.
  • Premium growth ahead of private peers, share gains should continue.
  • Banca productivity rising, channel driving cost efficiencies.
  • Changing product mix to aid value of new business margin expansion.

Morgan Stanley on SBI

  • Maintained 'Overweight'; cut target price to Rs 330 from Rs 390.
  • Cutting numbers to reflect higher asset quality strain.
  • Pick-up in downgrades and defaults in India imply non-performing loans outlook for SBI has become tougher.
  • Subsidiary valuations and core pre-provision operating profit growth drive 'Overweight' rating.

Macquarie on Zee Entertainment

  • Maintained 'Neutral' with target price of Rs 375.
  • Sale of solar assets to provide more comfort on promoter deleveraging.
  • Some relief, but not likely an immediate one.
  • Expect investors to now focus on fundamentals; fair value is Rs 500 of Zee.

Indian ADRs

All You Need To Know Going Into Trade On Aug. 30

Stocks To Watch

  • Hindalco: European Union Regulators to approve $2.6 billion Novelis Aleris deal. (Reuters)
  • GRUH Finance: HDFC to sell 9.2 percent stake or 6.74 crore shares in company via block deals. Likely to offer up to 3 percent discount to Thursdays closing price.
  • Adani Green Energy signed definitive agreement to acquire 10 renewable power-based companies which are valued at enterprise value of Rs 1,300 crore from Essel Group.
  • ICRA has terminated employment of Chief Executive Officer and Managing Director Naresh Takkar with immediate effect. Interim Chief Operating Officer Vipul Agarwal to oversee day-to-day operations until a CEO is appointed.
  • PNC Infratech declared lowest bidder for NHAI’s EPC project in Lucknow for a quoted price of Rs 1,062 crore.
  • Cox & Kings has obtained approval from ROC for extending the AGM up to Dec. 30.
  • MSTC: Bharti Airtel has appointed the company as selling agent for disposables of articles through the company’s auction website.
  • United Bank of India stated that repo-linked lending rate will be applicable for new housing and car loan schemes with effect from Sept. 1. Interest on housing loans to start at 8.15 percent and car loans at 8.7 percent.
  • HDFC Bank to split its face value and paid value from Rs 2 to Re 1, per share with effect from Sept. 19. To sell entire stake in India GST Network for Rs 1 crore
  • Max Financial Services to invest Rs 10 crore in rural housing and mortgage arm.

Also read: Aberdeen Seeks Shelter From Trade War in India, Southeast Asia

Data To Watch

  • Fiscal deficit for July.
  • Eight Infrastructure Industries Index for July.
  • GDP for quarter-ended June; estimated 5.7 percent (prior 5.8 percent)
  • GVA for quarter-ended June; estimated 5.5 percent (prior 5.7 percent)

Bulk Deals

Lemon Tree Hotels

  • Franklin Templeton Mutual Fund acquired 1.57 crore shares (1.98 percent) at Rs 55 each.
  • Van Eck Funds acquired 1.27 crore shares (1.6 percent) at Rs 55 each.
  • Maplewood Investment sold 4.97 crore shares (6.28 percent) at Rs 55 each.

Sarda Energy & Minerals

  • Acadian Emerging Markets Small Cap Equity Fund sold 1.8 lakh shares (0.5 percent) at Rs 148.47 each.

Apollo Pipes

  • Promoter Sanjay Gupta acquired 6.3 lakh shares (4.8 percent) at Rs 333.1 each.
  • Dinesh Pareekh sold 1.8 lakh shares (1.37 percent) at Rs 337 each.
  • FIL Investments (Mauritus) sold 3.92 lakh shares (3 percent) at Rs 330.1 each.

Pledge Share Details

  • SW Steel promoters created pledge of 1.1 crore shares from Aug. 20-27.
  • JSW Energy promoter JSW Investments created pledge of 1.5 crore shares on Aug. 27.
  • Steel Strips Wheels promoter group SAB industries released pledge of 4 lakh shares on Aug. 26.
  • Emami promoter groups created pledge of 37.5 lakh shares from Aug. 26-27.
  • Adani Ports & SEZ promoter group Gautam Adani created pledge of 4 lakh shares on Aug. 27.
  • Orient Cement promoter Shekhavati Investments and Traders created pledge of 23 lakh shares on Aug. 27.
  • Orient Electric promoter Shekhavati Investments and Traders created pledge of 3.8 lakh shares on Aug. 27.

Also read: Reliance Jio Market Share May Jump to 45%, India Ratings Says

Trading Tweaks

  • Excel Cropcare ex-date for amalgamation.
  • Balaji Telefilms, Lumax Industries to move into short term ASM Framework.
  • Industrial Investment Trust to move out of short term ASM Framework.
  • Shilpa Medicare, Minda Corporation, Zenlabs Ethica price band revised to 10 percent.
  • IL&FS Investment Managers, HDIL, Shyam Century Ferrous , Oil Country Tubular price band revised to 5 percent.

Who’s Meeting Whom

  • Allcargo Logistics to meet Laburnum Capital on Aug. 30.

Insider Trading

  • Hubtown promoter Rushank Shah acquired 77,000 shares on Aug. 28.
  • Man Infra promoter Parag Shah acquired 1 lakh shares on Aug. 28.

Money Market Update

  • The rupee gave up most of its losses to close flat at 71.78 against the U.S. currency on Thursday even as uncertainty over the U.S.-China trade talks and recession fears kept investors on edge.

Also read: Rupee Loses Mojo in Another Ugly August for India’s Currency

F&O Cues

Futures

  • Nifty Sept futures closed at 11,002.3, premium of 54 points.
  • Nifty futures across series open interest up 11 percent, adds 25 lakh shares in open interest.
  • Bank Nifty Sept futures closed at 27,435, premium of 130 points.
  • Bank Nifty futures open interest across series up 6 percent, adds 1.2 lakh shares in open interest
  • Rollovers: Nifty 69 percent, Nifty Bank 66 percent .

Options

  • Nifty PCR unchanged at 1.31 (across all series).

Nifty Weekly Expiry: Sep. 5

  • Max open interest on call side at 11,100 (18.3 lakh shares).
  • Max open interest on put side at 11,000 (12.5 lakh shares).
  • open interest addition seen at 11,100C (+11.1 lakh shares), 11,000C (+10.6 lakh shares).

Nifty Monthly Expiry: Sep. 26

  • Max open interest on call side at 11,700 (21.4 lakh shares).
  • Max open interest on put side at 11,000 (22 lakh shares).
All You Need To Know Going Into Trade On Aug. 30

Also read: ‘Now We Make Them Here': India Joins China as Smartphone Builder

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