All You Need To Know Going Into Trade On Jan. 17

Asian stocks rose to their highest since early December following gains in U.S. equities as signs of a better-than-expected start to the earnings season countered concerns about rising U.S.-China tensions.

Shares in Tokyo led gains after an overnight decline in the yen, with advances more muted in Sydney and Seoul and futures signalling modest gains in Hong Kong equities. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, rose 0.3 percent to 10,960 as of 6:50 a.m.

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BQ Live

U.S. Markets Check

• Stocks gained as signs of a better-than-expected start to the earnings season countered concerns about rising U.S.-China tensions.
• The yield on 10-year Treasuries held at 2.72 percent.

Asian Cues

• Japan’s Topix index rose 0.5 percent.
• Futures on the S&P 500 were flat. The S&P 500 Index climbed 0.2 percent Wednesday.
• Australia’s S&P/ASX 200 Index added 0.2 percent.
• South Korea’s Kospi advanced 0.1 percent.
• FTSE China A50 futures gained 0.3 percent.
• Hang Seng futures added 0.4 percent.

Commodity Cues

• West Texas Intermediate crude slipped 0.2 percent to $52.20 a barrel.
• Brent crude ended higher for the second day, up 1.12 percent at $61.32 a barrel.
• Gold gained less than 0.1 percent to $1,293.76 an ounce.

London Metal Exchange

• Aluminium ended higher for the second day, up 0.76 percent.
• Lead resumed rally after a two-day blip. up 0.36 percent.
• Copper ended higher for the second day, up 0.84 percent.
• Tin halted a seven-day rally, ended 0.46 percent lower.
• Zinc ended 1.65 percent higher.
• Nickel ended 0.34 percent lower.

Key Events/Data To Watch This Week

• Bank Indonesia will probably hold its benchmark at 6 percent Thursday, according to all economists surveyed by Bloomberg.
• Bank of Japan Governor Haruhiko Kuroda and Deputy Governor Masayoshi Amamiya speak at a G-20 event in Tokyo.
• Data on U.S. jobless claims and industrial production are due.

Indian ADRs

Stocks To Watch

• Bank of India determined the issue price of Rs 105.75 per share in respect of preferential issue of equity shares amounting to Rs 10,086 crore to the Government of India, as a part of the capital infusion plan.
• ICICI Bank received RBI nod for reappointment of Visakha Mulye as bank’s executive director for two years with effect from Jan. 19.
• Jet Airways said that the company is working on its cost reduction plans, debt reduction and funding option. The airline is also mulling on monetising assets including the its stake in its loyalty program.
• Bank of Maharashtra: RBI imposed penalty of Rs 1 crore on the bank due to deficiencies in regulatory compliances on fraud reporting and KYC norms.
• IIFL Holdings: NBFC arm plan to raise up to Rs 250 crore via bond issue. The issue opens for this tranche raising opens on Jan. 22 and closes on Feb. 20.
• NHPC’s board to consider raising Rs 2,000 crore via bonds on Jan. 21. Clarified on shutdown of Power Station Plant in Himachal Pradesh stating that the plant will remain shut from operation for 3 months with effect from Dec. 20. This plant contributes 4.54 percent in terms of total revenue for the company.
• Edelweiss Financial Services’ subsidiary Edelweiss Alternative Asset Advisors closed an India dedicated Alternative Investment Strategy Fund, by raising Rs 9,200 crore.

Nifty Earnings To Watch

• Hindustan Unilever
• Reliance Industries

Other Earnings To Watch

• Aditya Birla Money
• AU Small Finance Bank
• Cyient
• Federal Bank
• L&T Technology Services
• Mangalam Organics
• Mastek
• Rallis India
• Geojit Financial Services

Earnings Reactions To Watch

Mindtree (QoQ)

• Dollar revenue up 2.1 percent at $251.5 million
• Revenue up 1.8 percent at Rs 1,787.2 crore
• Net profit down 7.3 percent at Rs 191.2 crore
• EBIT up 5.6 percent at Rs 242.3 crore
• Margin at 13.6 percent versus 13.1 percent

Motilal Oswal Financial Services (YoY)

• Revenue down 20.1 percent at Rs 647.6 crore
• Net profit down 85.6 percent at Rs 39.9 crore
• Declares Dividend of Rs 4 per share
• Broking Revenue down 10 percent at Rs 269.5 crore

Bulk Deals

• Leel Electricals: IndusInd Bank sold 4.3 lakh shares or 1.07 percent equity at Rs 51.27 each.

Trading Tweaks

• NMDC ex-date for share buyback

Insider Trading

• Aarti Industries promoters sold 38k shares from Jan. 10-11
• Advanced Enzyme Technologies promoter group Piyush Rathi sold 1 lakh shares on Jan. 14
• Aster DM Healthcare promoter and director Dr Azad Moopen acquired 16.5k shares on Jan. 15

Money Market Update

• Rupee closed at 71.24/$ on Wednesday from 71.04/$ on Tuesday.

F&O Cues

• Nifty January futures closed trading at 10922, premium of 29 points
• Max open interest for January series at 11,000 Call (open interest at 36.4 lakh shares)
• Max open interest for January series at 10,500 Put (open interest at 40.2 lakh shares)

Stocks In F&O Ban

• Adani Power
• Jet Airways

Put-Call Ratio

• Nifty PCR at 1.54 versus 1.51.
• Nifty Bank PCR at 0.99 versus 1.

Brokerage Radar

Ambit on VIP Industries

• Initiated ‘Buy’ with a price target of Rs 653.
• Experienced team, investing in brand and own capacities to drive growth.
• Expect Ebitda margin to improve led by captive production, premiumisation and operating leverage.
• Near multiples don’t aptly build brand-and-opportunity confluence.
• Industry tailwinds to aid double-digit growth in volume and revenue.

On Mindtree

SBICAP

• Upgraded to ‘Buy’ from ‘Hold’; maintained price target at Rs 1,060.
• December quarter’s performance matches expectations.
• Management confident on sustaining growth momentum.
• Strong fundamentals; valuation turned attractive post correction.

Motilal Oswal

• Maintained ‘Buy’ with a price target of Rs 1,000.
• Signs of de-risking dependency on top client.
• March quarter’s outlook and growth commentary provide some reprieve.
• March quarter’s outlook hints at a strong exit; Hike revenue estimates for the next two financial years by 1.5 percent and 1.3 percent respectively.