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All You Need To Know Going Into Trade On Dec. 10

Stocks in the news, big brokerage calls of the day, complete trade setup and much more!



Financial traders monitor data on computer screens on the trading floor. (Photographer: Jasper Juinen/Bloomberg)
Financial traders monitor data on computer screens on the trading floor. (Photographer: Jasper Juinen/Bloomberg)

U.S. stock futures declined with equities in Asia amid a potential escalation of tensions between Washington and Beijing, and after signs China’s economy remains under pressure.

Futures on the S&P 500 Index dropped 0.8 percent and shares fell in Australia, Japan and South Korea, building on a weak Friday session when U.S. equities sank more than 2 percent. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 1.1 percent to 10,621 as of 7:04 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. stocks plunged, capping the worst week for the S&P 500 Index since March, as the Trump administration pressed its trade war with China and the latest batch of economic data added to concern that growth has peaked.
  • The yield on benchmark 10-year Treasuries dropped four basis points to 2.85 percent.
All You Need To Know Going Into Trade On Dec. 10
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Asian Cues

  • Japan’s Topix index fell 1.5 percent.
  • Australia’s S&P/ASX 200 Index lost 1.8 percent.
  • FTSE China A50 futures slid 0.4 percent and Hang Seng Index futures were flat late Friday.
  • Futures on the S&P 500 Index were down 0.8 percent.
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Commodity Cues

  • West Texas Intermediate crude dropped 0.3 percent to $52.44 a barrel.
  • Brent crude traded 0.55 percent higher at 62.01 per barrel.
  • Gold was little changed at $1,248.99 an ounce after gaining 0.9 percent Friday.

London Metal Exchange

  • Aluminium halted a two-day decline, up 0.98 percent.
  • Copper halted a three-day decline, up 1.24 percent.
  • Nickel ended 0.55 percent higher.
  • Zinc ended lower for the second day, down 0.23 percent.
  • Lead ended higher for the second day, up 0.55 percent.
  • Tin ended 0.4 percent higher.

Indian ADRs

All You Need To Know Going Into Trade On Dec. 10

Stocks To Watch

  • United Breweries’ CFO and Director Steven Bosch resigned from the company with effect from Jan. 01 2019.
  • Escorts transferred existing RT Crane business to its JV company with Japan-based Tadano for Rs 35 crore, on a slump sale basis.
  • Eid Parry operational details for November: Sugar sold at 0.31 LMT and alcohol sold at 48LL.
  • HEG said in its investor presentation that there could be a window of opprtunity to export graphite electrodes to China till 2022 as new electrode capacities in China would take longer time to come up than steel capacity.
  • Syndicate Bank reduced MCLR by five basis points across the six-month and one-year tenure instruments with effect from Dec. 10. Six-month MCLR at 8.70 percent and one-year MCLR at 8.75 percent.
  • Capital India’s board approved rights issue of 3.5 crore equity shares at Rs 72 each aggregating to Rs 249 crore.
  • Tata Sponge: Government gives environmental clearance to increase the production capacity of direct reduced iron plant to 4,65,000 TPA from 4,25,000 TPA
  • Indian Oil to to consider buyback and dividend on Dec. 13.
  • MERC finds increase in billing for Adani electricity customers to be unduly high; to appoint fact finding panel to check why bill amounts have shown unusual increase.
  • Sugar stocks in focus as Oil Ministry said that the ethanol blending in petrol would double to 8 percent.
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Earnings Reaction To Watch

IFCI (Q2, YoY)

  • Net interest income at - Rs 15.9 crore versus Rs 223.5 crore.
  • Net loss at Rs 16.6 crore versus net loss of Rs 293.7 crore.
  • Other Income of Rs 296.8 crore in the current quarter.
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Data To Watch

  • 10:30am: India car sales data for month of November.

Offerings

  • RattanIndia Infrastructure OFS for retail investors.

Who’s Meeting Whom

  • Shopper’s Stop to meet First State Stewart Asia, Axis Capital and other investors from Dec. 11-12.
  • PPAP Automotive to meet Ambit Capital on Dec. 10.
  • IIFL Holdings to meet Southern East Management on Dec. 10.
  • Globus Spirits to meet LIC Mutual Fund, ICICI Pru AMC and other investors on Dec. 10.
  • Shriram City Union Finance to meet TenCore Partners, Dolat Capital Makets and other investors from Dec. 10-13.

Insider Trades

  • Electrosteel Castings promoter acquired 80k shares from Nov. 30 to Dec. 05.
  • JM Financial promoter and director Vishal Kampani acquired 50,000 shares on Dec. 05.
  • Axis Bank promoter LIC sold 30.4 lakh shares from Dec. 04-06.
  • Lemon Tree Hotels promoter group Sparrow Buildwell acquired 31,200 shares from Dec. 05-06.

Money Market Update

  • Rupee ended at 70.81 a dollar on Friday versus 70.90 a dollar on Thursday.

F&O Cues

  • Nifty December futures closed trading at 10735, premium of 41 points
  • Max OI for December series at 11,000 Call, OI at 37.1 lakh shares.
  • Max OI for December series at 10,500 Put, OI at 35.4 lakh shares.

Put-Call Ratio

  • Nifty PCR at 1.47 from 1.44.
  • Nifty Bank PCR at 1.26 from 0.98.

Fund Flows

All You Need To Know Going Into Trade On Dec. 10

Brokerage Radar

Nomura on Exit Polls

  • Exit polls give BJP cold sweat; Set to lose Rajasthan; MP and Chhattisgarh remain nail biters.
  • Generally state election outcomes have been known to be a poor leading indicator of general elections.
  • BJP’s drubbing to mean that farm unrest is real; increase in MSP haven’t yielded political dividends.

Deutsche Bank Research on REC-PFC Deal

  • Limited benefits for combined entity; no material change for REC.
  • See negative impact on capital adequacy, credit rating and funding cost for PFC.
  • Buyout at premium will be negative for PFC shareholders.

Deutsche Bank Research on Consumer Durables

  • Next year's outlook positively guided; September quarter was impacted by high-base, excess inventory and weak season.
  • Positive outlook on domestic projects business with 2-5 year upcycle.
  • Election to have limited one-quarter impact on project business.
  • Voltbek raised capex to Rs 1000 crore to fund expansion in Tier II/III cities.

Morgan Stanley on Cement

  • Industry hiked prices in November, but channel checks show reversals in price trends in December
  • Prices flattish QoQ in North, Central and East and a marginal drop in West and South in September quarter.
  • Cost decline should support margins sequentially and on a yearly basis.

HSBC on Suzlon Energy

  • Maintained ‘Buy’; cut price target to Rs 9.5 from Rs 14.
  • Recovery post transition pain has been slower and shallower than expected.
  • Slower execution issues are being addressed; strong order book lends two years growth visibility.
  • Cut TP to factor in lower industry volumes.

Axis Capital on RBL Bank

  • Maintained ‘Buy’; hiked price target to Rs 660 from Rs 575.
  • Reiterate long-term outlook and belief in execution capability of the bank.
  • Bank is significantly investing in future and has capability to leapfrog into league of big banks.
  • Expect RBL to scale up materially on more share of high-yielding business, granular and diversified loan book, pan-India presence and room for operating leverage.