All You Need To Know Going Into Trade On Jan. 1

Happy new year!

Most Asian markets are closed, with the U.S. stocks ending the worst year since the financial crisis with a narrow gain in thin pre-holiday trading.

Stocks around the world limped into the end of a dismal year that’s seen bear markets in equities from Japan to Germany. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded a little changed at 10,921 as of 6:50 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 ended the worst year since the financial crisis with a narrow gain in thin pre-holiday trading.
• The yield on 10-year Treasuries fell three basis points to 2.68 percent.

Commodity Cues

• The Bloomberg Commodity Index fell 1.1 percent.
• West Texas Intermediate crude rose 8 cents to $45.41 a barrel.
• U.S. natural gas futures slid 9.8 percent to $2.979.
• Gold futures rose 0.1 percent to $1,284.30 an ounce.

London Metal Exchange

• Aluminium halted a five-day decline, ends 0.05 percent higher.
• Copper halted a two-day rally, ends 0.53 percent lower.
• Nickel ended lower for the third day, down 0.37 percent.
• Zinc ended 1.11 percent higher.
• Lead halted a three-day rally, down 1.99 percent.
• Tin ended 0.05 percent lower.

Indian ADRs

Stocks To Watch

• Automobile manufacturers will be in focus as they are set to announce their monthly sales data for December. (Here’s how they are expected to fare.)
• Lupin received FDA approval for Clobazam Oral Suspension. This is a generic version of Lundbeck Pharma’s Onfi Oral Suspension for adjunctive treatment of seizures associated with Lennox-Gastaut Syndrome in patients two years of age or older.
• JMC Projects received order worth Rs 596 crore. Out of this, Rs 434 crore is for residential and commercial projects in South India and the remaining Rs 162 crore is for civil works for a steel plant in Odisha. This company is a listed arm of Kalpataru Power Transmission.
• HDFC revised its Retail Prime Lending Rate on which its adjustable rate home loans are benchmarked by 10 basis points across various tenors, with effect from Jan. 1.
• Dynamatic Technologies said it will receive Rs 40 crore as consideration for transfer of all the fixed assets relating to the aluminum business of the Auto Division from Hi-Tech Arai. Along with this, the investors will also pay between Rs 5.5 and Rs 6.5 crore in order to acquire the company’s inventories.
• Centrum Capital’s arm acquired supply chain finance business of L&T Finance whose asset book consists of Rs 650 crore.
• Hindustan Construction Company said that its group Chief Financial Officer Praveen Sood has ceased to be the CFO and Key Managerial Personnel with effect from Dec. 31, upon the completion of the term of his contract. The company stated it is in the process of appointing the next CFO.
• Fortis Healthcare's board approved the extension of long stop date under the Master Purchase Agreement to March 26. The company and its arm had entered into the agreement to purchase Indian Entities of RHT Trust under this agreement in Nov. 2017. On Dec. 28, statutory auditors Deloitte Haskins & Sells LLP had resigned.
• Jindal Steel & Power's current CEO Naushad Akhter Ansari became the joint MD of the company with effect from Jan. 1.
• KEC International and Adani Transmission mutually agreed to extend the date of sale to Jan. 31. They entered into this agreement on Nov. 3 in which KEC International was to sell its entire stake in ‘KEC Bikaner Sikar Transmission Private Limited’ to Adani group’s transmission arm.
• Allahabad Bank revised MCLR by 10 basis points across various tenors. Overnight MCLR at 8.25 percent and One Year MCLR at 8.75 percent.
• CreditAccess Grameen said it has completed a direct assignment of Rs 277.73 crore and securitiastion transaction of Rs 110.5 crore.
• Shriram Transport Finance would consider raising fund via debt during the month of January.

Bulk Deals

• Hindustan Construction Company: Promoter Arya Capital Management sold 1.45 crore shares or 1.44 percent equity at Rs 11.87 each.
• AVG Logistics: Sixth Sense India Opportunities acquired 51,600 shares at Rs 74.45 each (Alert: This Stock is listed on NSE Emerge)

Insider Trading

• Hindustan Construction Company promoters acquired 21.9 crore shares via rights issue on December 28. Their stake has increased from 27.8 percent to 33.12 percent.

Trading Tweaks

• Dhanuka Agritech ex-date for share buy-back.
• 5paisa Capital price band revised to 5 percent.

Money Market Update

• Rupee ended at 69.77/$ yesterday versus Friday’s 69.95/$.

F&O Cues

• Nifty January Futures closed trading at 10917, premium of 55 points.
• Max OI for January series at 11,200 Call, OI at 28.2 lakh shares.
• Max OI for January series at 10,500 Put, OI at 33.2 lakh shares.

Stocks In F&O Ban

• Adani Power

Put-Call Ratio

• Nifty PCR at 1.53 versus 1.54.
• Nifty Bank PCR at 1.03 versus 1.11.

Fund Flows

Brokerage Radar

HDFC Securities on Asset Management Companies

• Mutual fund industry is under-penetrated; Expect financialisation of savings to grow at 9.7 percent CAGR over FY18-30.
• Impact of changes in TER to become clear over 1-2 quarters; Expect 75-85 percent pass through.

HDFC Securities on HDFC AMC

• No Rating/Recommendation.
• Business does not need incremental capital; Expect RoICs to improve.
• Expect AUM, revenue and net profit to grow at a CAGR of 18.3 percent, 6.7 percent and 17.4 percent respectively over FY18-21
• See one-year forward fair value at Rs 1708 per share versus current market price of Rs 1,510.

HDFC Securities on Reliance Nippon

• Initiated ‘Buy’ with a price target of Rs 227, implying a potential upside of 43 percent from the last regular trade.
• Appreciate RNAM’s focus on building granular stickier retail assets.
• Profits hit in FY18 and Q2FY19; increase in profitability is key trigger for re-rating.
• Inter-corporate deposits remain a concern.
• Expect AUM, revenue and net profit to grow at a CAGR of 19 percent, 1.2 percent and 9.5 percent respectively over FY18-21.

Emkay on JK Cement

• Upgraded to ‘Buy’ from ‘Accumulate’; hiked price target to Rs 864 from Rs 846.
• Grey cement: capacity expansions to drive volume growth.
• White cement segment more sustainable than grey cement in terms of profitability.
• Prefer JK Cement due to its exposure to white cement.

Emkay on Britannia Industries

• Maintained ‘Hold’ with a price target of Rs 2,950.
• Stepping up its foods play; Aggressive new-launch pipeline ahead.
• Potential to scale up reach and drive growth through small packs.
• Believe that a lot is already baked in and there exist downside risks to margin.