All You Need To Know Going Into Trade on July 12

Stocks in Asia traded mixed Friday as trade-tensions resurfaced. Treasuries held losses seen after a U.S. inflation reading that came in above expectations.

Shares were little changed in Japan and South Korea, and slipped back in Australia. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.13 percent to 11,567 as of 7:15 a.m.

Short on time? Well, then listen to this podcast for a quick summary of All You Need To Know before the opening bell.

BQ Live

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

U.S. Market Update

• U.S. equities rallied late to close at a record high, while Treasuries retreated after the latest American inflation reading came in hotter than anticipated.

Asian Cues

• Futures on the S&P 500 Index rose 0.2 percent in Hong Kong. The underlying gauge rose 0.2 percent Thursday.
• Japan’s Topix index fell 0.2 percent.
• Hong Kong’s Hang Seng slid 0.1 percent.
• South Korea’s Kospi index rose 0.3 percent.
• Australia’s S&P/ASX 200 Index fell 0.3 percent.

Commodity Cues

• West Texas Intermediate crude added 0.5 percent to $60.49 a barrel.
• Gold was at $1,408.08 an ounce, up 0.3 percent.

London Metal Exchange

• Copper ended higher for the second consecutive trading session, closed 0.25 percent higher.
• Lead ended higher for the fourth consecutive trading session.
• Tin halted a two-day fall, closed 0.82 percent higher.
• Zinc ended higher for the fourth consecutive trading session, closed 1.12 percent higher.

• Aluminium ended a three-day gaining streak, closed 1.19 percent lower.
• Nickel ended higher for the second consecutive trading session, ended 1.08 percent higher.

Data To Watch

• 5:30 p.m.: India June Consumer Price inflation YoY; estimate 3.13 percent (prior 3.05 percent)
• 5:30 p.m.: India May Industrial Production YoY; estimate 2.85 percent (prior 3.4 percent)

Indian ADRs

Stocks To Watch

• CARE Ratings downgraded Cox & King’s long-term debt facilities to CARE D. Instruments with this rating are in default or are expected to be in default soon.
• KPR Mill becomes the first company to cancel its buyback plan after Budget 2019 imposed a tax on repurchase of shares. (more details here)
• Himachal Futuristic won Rs 199 crore order from BEL for supply of Optical Fibre Cables.
• Gravita India started commercial production of aluminum cast alloys from its new plant in Tanzania, Africa. The facility has a total capacity of 6,000 MTPA and expects to generate Rs 20 crore in revenue along with gross margin of 15 percent from this plant in fiscal 2020.
• Salzer Electronics completed acquisition of 72.32 percent stake in Kaycee Industries.
• KSK Energy Ventures said NCLT admits insolvency resolution plea filed by Axis Bank for subsidiary Sai Lilagar Power Generation Ltd.
• Videocon will publish fourth quarter and full year fiscal 2019 results by July 20, 2019.
• Unitech will publish fourth quarter and full year fiscal 2019 results by July 12, 2019.

Nifty Earnings To Watch

• Infosys
• IndusInd Bank

Other Earnings To Watch

• Karnataka Bank
• Hathway Cable & Datacom
• 3i Infotech
• TRF

Earnings Reaction To Watch

Den Networks (Q1, YoY)

• Revenue flat at Rs 313 crore.
• Net profit at Rs 11 crore versus net loss of Rs 31 crore.
• Ebitda down 11 percent at Rs 42 crore.
• Margin narrows to 13.4 percent from 15 percent.
• Other income of Rs 51 crore

Who’s Meeting Whom

• Adani Ports & SEZ to meet analysts/institutional investors on July 12,13 and 22.

Money Market Update

The Indian rupee is likely to open weaker today. Implied opening from forwards suggest rupee may start trading at 68.50 to the dollar.

In the bond market, sovereign bond investors will await the release of June consumer price inflation data to gauge the possibility of a further rate cut in the August policy. According to a Bloomberg survey, June consumer price inflation is estimated at 3.13 percent year-on-year.

Bond traders will also away May industrial production data.

F&O Cues

July Futures

• Nifty futures closed at 11,582, discount of 0.8 points versus 6.6 points.
• Nifty futures open interest down 5.5 percent, sheds 10 lakh shares in open interest.
• Bank Nifty futures closed at 30,717.
• Bank Nifty futures open interest down 3 percent, sheds 53,000 shares in open interest.

Options

• Nifty PCR at 1.24 versus 0.84(across all series).

Nifty Weekly Expiry 18-July

• Max open interest on call side at 11,700 (10.9 lakh shares).
• Max open interest on put side at 11,500 (11.6 lakh shares).
• Open interest addition seen in 11,500P (+8 lakh shares), 11,700C (+5 lakh shares).

Nifty Monthly Expiry 25-July

• Max open interest on call side at 12,000 (32.3 lakh shares).
• Max open interest on put side at 11,300 (21.4 lakh shares).

Stocks In F&O Ban

• DHFL
• IDBI Bank
• Reliance Capital
• Reliance Infra

Brokerage Radar

BofA Securities on Cement

• ACC: Upgrade to ‘Neutral’ from ‘Underperform’, raised price target to 1,695 from 1,586.
• Ambuja Cements: Upgraded to ‘Buy’ from ‘Neutral’, raised price target to 261 from 238.
• Expect continued roll-back of price hikes in the second quarter.
• Cement demand to moderate to 5.6 percent CAGR over FY19-22.

UBS on Lupin

• Maintained ‘Buy’ with a price target of 900.
• FY19 cash flow boosted by decreased working capital.
• Margin pressure in emerging markets business.

Kotak Securities on ICICI Bank

• Maintained ‘Buy’, raised price target to Rs 510 from Rs 460
• Balance sheet is getting stronger.
• Business back on track to deliver normalised levels of RoEs by FY20-21.
• There’s negligible risk in corporate portfolio.
• Inexpensive valuation driving positive view.