Traders work on the trading floor of the Motilal Oswal Financial Services Ltd. office in Mumbai, India. (Photographer: Vivek Prakash/Bloomberg)

All You Need To Know Going Into Trade On Nov 22

Stocks in Asia got some reprieve from the recent sell-off after a modest rebound in technology and energy shares underpinned gains in U.S. equities.

Equity benchmarks nudged higher in Japan and Australia, while futures pointed to gains in Hong Kong after most major U.S. equity benchmarks closed higher in light pre-Thanksgiving trading. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, erased early gains and traded a little changed at 10,623.50 as of 7:25 a.m.

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BQ Live

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

U.S. Market Check

  • Stocks rose Wednesday as tech rallied and surging oil pushed energy shares higher.
  • The yield on 10-year Treasuries was little changed 3.0609 percent.

Also read: Goldman, JPMorgan Still Betting on Five Fed Hikes by End of 2019

Europe Market Check

European shares rallied, reversing five days of losses, amid signs the Federal Reserve may consider pausing interest rate increases.

All You Need To Know Going Into Trade On Nov 22

Also read: EU Takes First Step Toward Fining Italy on Budget: Italy Update

Asian Cues

  • Japan’s Topix index rose 0.3 percent.
  • Australia’s S&P/ASX 200 Index gained 0.4 percent.
  • Hong Kong’s Hang Seng Index contracts climbed 0.9 percent.
  • S&P 500 futures rose were little changed.

Also read: Pakistan Says $1 Billion Support Received From Saudi Arabia

Commodity Cues

  • West Texas Intermediate crude was little changed at $54.60 a barrel. It jumped 2.3 percent Wednesday, the largest gain in seven weeks.
  • Brent crude fell 0.46 percent at $63.19 per barrel.
  • Gold held at $1,225.72 an ounce.

Also read: Historic Price Crash Plunges Canadian Oil Patch Into Crisis

London Metal Exchange

  • Aluminium ended higher for the second day, up 0.7 percent.
  • Copper ended 0.82 percent higher.
  • Zinc halted a two-day decline, up 0.67 percent.
  • Nickel ended lower for the third day, down 0.68 percent.
  • Lead ended 2.29 percent higher.
  • Tin ended lower for the second day, down 0.82 percent.

Indian ADRs

All You Need To Know Going Into Trade On Nov 22

Stocks To Watch

  • Gujarat Ambuja Exports received National Green Tribunals order stating proceedings against the company’s maize processing unit at Uttrakhand have been dropped.
  • Huhtamaki PPL received closure directions from Maharashtra Pollution Control Board on Nov. 20 for its Thane Plant. The company has filed a writ petition in Bombay High Court on Nov. 21. The aforesaid plant contributed about 10 percent of the annual turnover of the company for financial year ending December 2017.To ensure continuity of supplies to customers, the company says it shall divert customer orders to other plants in India.
  • Jet Airways clarified that a news item of merger with Jet Privilege and Jet Airways was merely speculative in nature. The company said it was in talks with investors to secure sustainable financing.
  • Deepak Fertilisers & Petrochemicals said normal operations had resumed fully as the Income Tax team conducting search and seizure operations left the company’s offices.
  • GMR Infra signed a concession agreement for development of commercial port in Andhra Pradesh.

Who’s Meeting Whom

  • Tata Steel to meet Rare Enterprises, Finistree and BNP AMC from Nov. 22-27.
  • Asian Paints to meet RMC Global AMC, Argonaut PE and other investors from Nov. 22-Dec. 03.
  • CG Power and Industrial Solutions to meet Reliance MF and HDFC MF from Nov. 22-23.

Insider Trades

  • Raymond promoter group JK Investors acquired 70,000 shares from Nov. 19-20.
  • Alembic promoter group acquired 2 lakh shares from Nov. 19-20.
  • Man Infra promoter Manan Shah acquired 50,000 shares on Nov. 20.

Trading Tweaks

  • 8K Miles Software Services to move into ASM framework.

Money Market Update

  • Rupee on Tuesday closed at 71.45/$ versus Monday’s 71.66/$. Money market operations were shut on Wednesday.

Also read: Rupee Clears One Obstacle Only to Face Another in State Polls

F&O Cues

  • Nifty November futures closed trading at 10,622, premium of 22 points.
  • Nifty November open interest down 2.6 percent; Nifty Bank November open interest up 7.4 percent.
  • Max open interest for November series at 11,000 Call option (open interest at 36 lakh shares).
  • Max open interest for November series at 10,000 Put option (open interest at 39 lakh shares).

Stocks In F&O Ban

  • Adani Power
  • Adani Enterprises
  • Jet Airways
  • PC Jeweller
  • DHFL

Put-Call Ratio

  • Nifty PCR at 1.55 from 1.64.
  • Nifty Bank PCR at 1.19 from 1.01.
All You Need To Know Going Into Trade On Nov 22

Brokerage Radar

On Vodafone Idea

UBS

  • Maintained ‘Neutral’ with a price target of Rs 37.
  • Rapid expansion of 4G coverage in coming six-12 months.
  • Reiterate Rs 14,000 crore synergy target two years ahead of schedule.
  • Believe FY19-20 capex guidance appears low and implies recovery may take time.

BofAML

  • Maintained ‘Underperform’; cut price target to Rs 35 from Rs 40.
  • Looking to maintain No 1 with low capex and more synergies.
  • Management does not expect price-war to worsen; prices un-sustainable even at current levels.
  • Reiterate Underperform as the company is vulnerable to market share risks.

More Calls

Motilal Oswal on Indian Hotels

  • Initiated ‘Buy’ with a price target of Rs 163.
  • Attractive play on upcoming industry upcycle; market dynamics to turn favorable.
  • Expect margins to increase by 500 basis points over FY18-20 due to operating leverage.
  • Change in distribution channel mix to help reduce cost.
  • Expect ARR growth of 8-10 percent as occupancy reaches optimum levels.

CLSA on Havells India

  • Downgraded to ‘Outperform’ from ‘Buy’; hiked price target to Rs 720 from Rs 710.
  • Negligible impact from NBFC liquidity issue; online aggression key concern.
  • Moving past near-term Llyod challenges; expect a gradual margin expansion.
  • Downgrade given rich valuations.

Macquarie on NMDC

  • Downgraded to ‘Neutral’ from ‘Buy’; cut price target to Rs 110 from Rs 138.
  • Donimalai’s lease issues may be drawn-out legal battle; expect six-month disruption.
  • See iron ore prices close to peak; steel plant facing some delays.
  • Lack of growth and mine uncertainty should keep multiples depressed.

Morgan Stanley on Tech Mahindra

  • Maintained ‘Overweight’ with a price target of Rs 880.
  • No surprises in analyst meet; mgmt. maintained its positive outlook.
  • Steady growth in enterprise business to continue.
  • Margins have tailwinds from the current levels.

JPMorgan on Power Grid Corp

  • Maintained ‘Overweight’; cut price target to Rs 215 from Rs 230.
  • Growth pick in the past, a value pick now.
  • Expect 12 percent earnings CAGR over FY18-21 given the current works-in-hand.
  • Stock trading at trough valuations; may prove a relatively safe haven.