All You Need To Know Going Into Trade On Dec. 20 

Asian stocks declined after U.S. equities swung from gains to losses as Federal Reserve Chairman Jerome Powell failed to quell investor concerns that tightening policy will choke economic growth.

Equities opened lower in Japan and South Korea, while futures signaled most other Asian markets will be off to a negative start. Still, declines were subdued as U.S. futures ticked higher.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.84 percent to 10,893 as of 7:12 a.m.

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

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

U.S. Market Check

• U.S. stocks careened to a 15-month low after Jerome Powell failed to quell investor angst that the Federal Reserve’s tightening policy will throttle economic growth.
• Investors had anticipated a less aggressive approach after U.S. stocks tumbled into a correction amid concern that global growth is slowing.

Asian Cues

• Japan’s Topix index fell 0.6 percent in Tokyo.
• Australia’s S&P/ASX 200 Index was little changed.
• South Korea’s Kospi index dropped 1.1 percent.
• Futures on the FTSE China A50 fell 1 percent.
• S&P 500 futures rose 0.3 percent. The S&P 500 fell 1.5 percent at the close in New York.

Coming Up

• The Bank of Japan’s monetary policy decision is due Thursday, followed by a briefing from Governor Haruhiko Kuroda. A Bank of England decision is also Thursday.

Indian ADRs

Stocks To Watch

• Pfizer Inc entered into a joint venture agreement with GlaxoSmithKline Plc to create a global consumer company. However the entity will not include brands like Corex, Gelusil and Becosules and they will be continued to be marketed by Pfizer’s Indian arm in its respective territory.
• Uflex launched three packaging foil solutions for pharma companies. Executive Director Amitava Ray said that the ‘fast tear strip’ foil will prove to be a game-changer for the pharma industry globally and they saw a potential growth market of 5,000 tons annually in India.
• Reliance Industries clarified on the news regarding Department of Telecommunications rejecting Reliance Communication-Jio spectrum deal stating that a correspondence was received by the company from DoT on Dec. 18 with respect to application and the company is seeking appropriate clarifications in this regard.
• Coal India seeks to buy coking coal mines in Australia and Canada. The state run-miner has identified “certain assets’, which are under different stages of due diligence, Coal Minister Piyush Goyal tells lawmakers in a written reply to questions. (Bloomberg News)
• Tata Consultancy Services aunched Cloud Solutions Program in Canada. This solution provides cloud infrastructure and secured functioning between premise and public cloud environment.
• Cosmo Films launched sterilisable conduction sealing film. This film is mainly used in dairy industry for flavored milk, pharma industry and bakery products.
• Religare Enterprises’ subsidiary filed a criminal complaint against the Singh brothers, former promoters of the parent, and their associates for allegedly siphoning and misappropriating Rs 740 crore.
• JSW Steel said that NCLT approved the resolution plan in the insolvency resolution process for Vardhman Industries.
• KPIT Technologies: NCLT approved the merger plan with Birlasoft, which will then split into two-publicly traded companies. The tribunal also approved the demerger of company’s engineering business into KPIT Engineering.
• Alembic Pharma received zero observations under Form 483 from the U.S. FDA for its API facility in Gujarat.
• Allcargo Logistics said it will explore emerging business opportunities related to Container Freight Stations, Inland Container Depots and Logistics Parks in India.
• Thomas Cook and Quess Corp: Board approves changes to scheme of arrangements within the group units. Thomas Cook shareholders to get 1,886 shares of Quess Corp for every 10,000 held.

• Tata Motors: Fitch says JLR restructuring no enough to lift ratings pressure
• Sun Pharmaceutical’s new drug application for Rosuvastatin, drug name Ezallor, received FDA approval on Dec. 18.
• Wockhardt: To consider fund raising by issuing preference shares on Dec. 22.
• ICRA: Received SEBI notice for conduct of adjudication proceedings in relation to credit ratings assigned to Infrastructure Leasing & Financial Services Ltd. and one of its subsidiaries. These proceedings deal with potential imposition of monetary penalty.
• OM Metals Infraprojects: Wins Rs 615 crore EPC contract from water resources department of Rajasthan.

Heads-up!

• Coal India board to consider dividend.
• ONGC and Indian Energy Exchange board to consider buyback.
• Bharti Airtel to consider various fund-raising options.
• Container Corp to consider bonus issues.
• Dr. Reddy’s Labs: It’s the last date for Indivior to file an appeal against the Suboxone hearing.

Who’s Meeting Whom

• Gujarat Pipavav Ports to meet Indsec Securities & Finance on Dec. 20.
• Mahindra Holidays & Resorts to meet Sundaram MF, Franklin Templeton and other investors on Dec. 21.
• Eicher Motors to meet Axis Capital on Dec. 20.
• Shriram City Union Finance to meet Batlivala & Karani Securities and Newmark Capital between Dec. 20-28.

Insider Trading

• Orient Bell promoter acquired 11,000 shares on Dec. 18.
• Max India promoter Max Ventures Investment Holdings sold 1.9 crore shares on Dec. 17.
• Jindal Stainless promoter Abhyuday Jindal acquired 50,000 shares between Dec. 17 and 18.

(As reported on Dec. 19)

Trading Tweaks

• Bosch, SKF India Ex-Date for share buyback.

F&O Cues

• Nifty December futures closed trading at 10,986, premium of 19 points.
• Max open interest for December series at 11,000 strike value call option (open interest at 38 lakh shares)
• Max open interest for December series at 10,000 strike value put option (open interest at 47 lakh shares)

Stocks In F&O Ban

• Adani Enterprises
• Adani Power
• Jet Airways
• Reliance Capital

Put-Call Ratio

• Nifty PCR at 1.66 from 1.58.
• Nifty Bank PCR at 1.36 from 1.51.

Get a detailed drawdown of derivatives on BloombergQuint's F&O page.

Brokerage Radar

Morgan Stanley on Biocon

• Maintain ‘Overweight’ with a target price of Rs 785.
• Biocon received EU approval for Ogivri, Herceptin.
• Estimate Herceptin EU addressable market for biosimilars is $750 million.
• Assuming 50-60 percent price drop and fair market share of 15-20 percent, expect sales potential to be $55-60 million over next two years.

SBICap on Gujarat Ambuja Exports

• Maintain ‘Buy’ with target price of Rs 370
• Chalisgaon ramp-up impressive; announces 33 percent increase in maize processing capacity
• To continue to benefit from strong export demand
• No impact of MSP-led increase in corn prices as hike in prices passed on

Axis Capital on Take Solutions

• Initiate ‘Buy’ with target price of Rs 178.
• Large addressable market as global life sciences R&D expenditure is growing.
• Huge gamut of opportunity lying in clinical business.
• Focus on expansion with organic as well as inorganic growth to propel growth.
• Expect revenue and net profit to grow at a CAGR of 23 percent and 30 percent over FY18-21.

HDFC Securities on Coal India

• Initiate Sell with target price of Rs 199.
• Profit growth lags volumes; pricing power restricted.
• Coal India’s pricing methodology has no profit maximization motive.
• Capex on an uptrend, but not driving profits higher.
• Cash richness is myth; adjusting for long term provisions it is net debt company.