A trader speaks on a fixed-line telephone, as he makes a note, on the trading floor of the open outcry pit at the London Metal Exchange Ltd. (LME), in London, U.K. (Photographer: Simon Dawson/Bloomberg)

All You Need To Know Going Into Trade On Feb. 18

Asian stocks rose on Monday following a strong U.S. session on Friday amid optimistic signs on the economy and trade discussions.

Shares in Japan led the way higher, while equities in Australia and South Korea posted more modest advances. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.20 percent to 10,775 as of 8:15 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 surged to a 10-week high as the U.S. consumer outlook brightened and positive developments in China trade talks overshadowed lingering concerns about global growth.
  • The yield on 10-year Treasuries climbed one basis point to 2.66 percent on Friday. Treasuries won’t trade on Monday due to the U.S. holiday.
All You Need To Know Going Into Trade On Feb. 18

Asian Cues

  • Japan’s Topix index rose 1.5 percent.
  • South Korea’s Kospi index climbed 0.6 percent.
  • Australia’s S&P/ASX 200 index added 0.6 percent.
  • Hang Seng Index futures advanced 0.9 percent late Friday.
  • The MSCI Asia Pacific Index advanced 0.7 percent.
  • Futures on the S&P 500 were flat.

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Commodity Cues

  • Brent crude extended its rally for the fourth day, up 0.48 percent to $66.57 per barrel.
  • West Texas Intermediate crude rose 0.5 percent to $55.88 a barrel.
  • Gold dipped 0.1 percent to $1,321.23 an ounce.

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London Metal Exchange

  • Copper ended higher for the third day, up 0.83 percent.
  • Aluminium halted a seven-day fall, ended 0.49 percent higher.
  • Nickel halted a five-day fall, ended 1.64 percent higher.
  • Lead ended higher for the second day, up 2.01 percent.
  • Tin ended 1.44 percent higher.
  • Zinc halted a five-day fall, ended 2.39 percent higher.

Key Events To Watch This Week

  • The Federal Reserve will on Wednesday publish minutes from its recent meeting. Bloomberg Economics thinks officials aimed to over-correct to avoid a repeat of the negative reaction to December’s statement, so a focal point will be how much the hawks were on board with the switch.
  • Bank of Canada Governor Stephen Poloz speaks on Thursday and Reserve Bank of Australia Governor Philip Lowe gives parliamentary testimony on Friday.

Indian ADRs

All You Need To Know Going Into Trade On Feb. 18

Stocks To Watch

  • Dr. Reddy’s Laboratories: U.S. regulator cleared the company’s Duvvada facility for exports to the American market, providing relief a day after its shares tumbled nearly 30 percent on repeated concerns about its Telangana plant.
  • Anil Ambani-led Reliance Group has reached a “standstill agreement” with more than 90 percent of its lenders under which they will not sell any of the shares pledged by promoters till September.
  • Yes Bank: Reserve Bank of India reprimanded the private lender for selectively revealing a “confidential” report by the regulator that led to a 30 percent surge in the lender’s shares on Thursday, calling the disclosure a “deliberate attempt” to mislead the public.
  • Sun Pharma Advanced Research: Sun Pharma Global FZE said that it is not planning to launch Elepsia in the U.S. market, thus it will return the product rights back to Sun Pharma Advanced Research. The license was given to Sun Pharma Global in July 2016 and was eligible for royalties upon the commercialisation of the product. The research company said that it will find another partner for commercialising the aforementioned product.
  • BPCL’s arm executed long term liquefied natural gas sale purchase agreement with Mozambique LNG1 for 1MMTPA of LNG for 15 years.
  • Coffee Day Enterprises: Income Tax Department provisionally attached 2.04 crore encumbered shares of promoter VG Siddhartha for six months. The company says that the promoter has filed required revised returns and discharged all the tax liabilities.
  • Tech Mahindra withdrew the scheme of merger with its arm ‘Tech Mahindra Growth Factories’ with self.
  • Jet Airways said its gross debt stands at Rs 7,654 crore of which aircraft debt stands at Rs 1,585 crore as of Dec. 31. The airline said that its debt will only reduce through equity infusion or debt restructuring, and the issuance of 11.4 crore shares will reduce debt by Re 1. It added that the stake sale of JetPrivilege will be done at a later stage and not now.
  • SAIL annuls Expression of lnterest for 100 percent stake sale in Durgapur Alloy Steel Plant. The fresh process for stake sale has been initiated with the approval of the government. The company will issue Preliminary Information Memorandum and EoI shortly.
  • MBL Infrastructures: Toll Road Company Private Ltd., a special purpose vehicle of the company, commenced commercial operation for a national highway project of Suratgarh-Bikaner section in Rajasthan. The company has equity investment of Rs 185 crore. This is the fourth public interest project substantially completed by the company after the approval of resolution plan. The company expects to complete five more public interest projects by March 31.

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Media Reports

  • PE firms vie for 20 percent in DHFL (Economic Times).

Who’s Meeting Whom

  • Eicher Motors to meet Spark Capital Advisors and BOB Capital Markets on Feb. 19.
  • Tata Motors to meet AIA Group, BlackRock and other investors from Feb. 18-22.
  • KEC International to meet Kotak Securities on Feb. 19.
  • Pidilite Industries to meet Sparx AMC on Feb. 19.
  • Mahindra & Mahindra to meet Mitsubishi UFJ Kokusai AMC, Econopolis Singapore and other investors from Feb. 18-20.
  • Voltas to meet Fidelity Management and Morgan Stanley on Feb. 18.

Insider Trading

  • Greaves Cotton promoter Karun Carpets acquired 80,000 shares from Feb. 12-14.
  • UPL promoter Shilpa Sagar sold 60,000 shares from Feb. 13-14.
  • IndusInd Bank promoter IndusInd International Holdings acquired 46,900 shares on Feb. 13.
  • Thyrocare Technologies promoter A Velumani HUF acquired 82,900 shares on Feb. 13.

Trading Tweaks

  • Ashapura Intimates Fashion, Zee Media Corporation, Jindal Stainless , IG Petrochemicals, Reliance Home Finance to move into short term ASM framework.

Money Market Update

  • Rupee closed at 71.23/$, versus 71.17/$ on Thursday.

Also read: Central Bankers Take to Stage as Dovish Outlooks Spread

F&O Cues

  • Nifty February Futures closed trading at 10,747, a premium of 23 points.
  • Max Open Interest for February series at 11,000 Call, OI at 41.5 lakh shares.
  • Max OI for February series at 10,700 Put, OI at 32.1 lakh shares.

Stocks In F&O Ban

  • In ban: Adani Enterprises, Jain Irrigation, Jet Airways, Reliance Power, CG Power and PC Jeweller.
  • Out of ban: IDBI Bank.

Put-Call Ratio

  • Nifty PCR at 1.3 versus 1.35.
  • Bank Nifty PCR at 1.06 versus 1.2.

Fund Flows

All You Need To Know Going Into Trade On Feb. 18

Brokerage Radar

Goldman Sachs on Aditya Birla Fashion

  • Initiated ‘Buy’ with a price target of Rs 250.
  • Renewed focus on in-house brands, optimising space will drive margin.
  • Good mix of premium and affordable with expansion into smaller cities.

Edelweiss on Dr. Reddy’s Laboratories

  • Maintained ‘Buy’ with a price target Rs 3,450.
  • Duvvada clearance lifts a big overhang for the stock.
  • Facility accounts for almost 20 of the total 100 products in pipeline.

Credit Suisse on GlaxoSmithKline Consumer

  • Downgraded to ‘Neutral’ from ‘Outperform’; lowered price target to Rs 8,330 from Rs 9,000.
  • Healthy volume growth, margin tailwinds may be behind.
  • GSK stock is now a proxy for HUL; cut target on share-swap ratio.

Macquarie on RIL

  • Downgraded to ‘Neutral’ from ‘Outperform’, cut price target to Rs 1,280 from Rs 1,315.
  • Believe the positives have been discounted at current price.
  • See structurally disruptive growth ahead for Jio and retail businesses.

BofA ML on Zee

  • Upgraded to ‘Neutral’ from ‘Underperform’, hiked price target to Rs 455 from Rs 375.
  • Not included any potential M&A in upgrading stock.
  • Pledged share overhang appears largely to be behind us.
  • Not a ‘Buy’ as fundamentally we expect the OTT market to be competitive.