All You Need To Know Going Into Trade On Nov. 22

Asia stocks saw muted trading Friday as investors awaited further details on U.S.-China trade discussions.

Stocks were little changed in Japan and edged higher in South Korea and Australia. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, traded little changed at 11,980 as of 6:40 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.

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

• U.S. equities slid following losses in Europe and Asia as traders weighed conflicting signals about the outlook for a trade deal between Beijing and Washington. The S&P 500 Index fell for a third day, the longest losing streak in almost two months, but remained within 1 percent of a record high.
• Crude is on track to rise for a third week after China signalled a renewed desire to settle the trade war with the U.S. that has disrupted global energy demand.

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Trading Tweaks

• Kaveri Seed, JB Chemicals & Pharma record date for share buyback
• Mohota Industries, S Chand And Company to move into short term ASM Framework
• MT Educare, OM Metals Infraprojects to move out of short term ASM Framework
• Gayatri Projects, S Chand and Company, Tejas Networks, UCO Bank price band revised to 10 percent.

Brokerage Radar

Macquarie on IGL

• Downgraded to ‘Neutral’ from ‘Outperform’; hiked price target to Rs 420 from Rs 410.
• IGL has delivered 50 percent returns in last three quarters; stock is fully valued.
• Hike FY21/22 EPS estimates by 5-6 percent on better margin and steady volume expectations.
• Pecking Order: Gujarat Gas>Mahanagar Gas>IGL.

Morgan Stanley on Dilip Buildcon

• Maintained ‘Overweight’; cut price target to Rs 504 from Rs 772.
• Focused on improving execution in H2 and reducing debt.
• Given its diversified and large order book, company has reasonable earnings visibility.
• Interest remains low in road EPC stocks as NHAI ordering has been slow.

Morgan Stanley on NTPC

• Upgraded to ‘Overweight’ from ‘Equal-weight’; hiked price target to Rs 152 from Rs 146.7.
• Fixed costs under-recovery is reducing, impact of regulations is known.
• Potential government stake sale remains an overhang.
• Risk-reward is attractive; steady commissioning should drive earnings.

UBS on Aegis Logistics

• Maintained ‘Buy’ with a price target of Rs 265.
• Upcoming infrastructure projects provide good visibility on future growth.
• Retail and auto gas likely to support growth plans over the medium term.
• Initial signs of growth acceleration in overall solid second quarter results.

HSBC on Reliance Industries

• Maintained ‘Buy’; hiked price target to Rs 1,700 from Rs 1,565.
• Operating trends for both telecom and organised retail remain strong.
• Jio plans to raise tariffs, offering scope for rapid improvement in profitability.
• Organised retail: Strong growth across its formats.

Morgan Stanley on Info Edge (India)

• Maintained ‘Equal-weight’ with a price target of Rs 2,400.
• Investments in Naukri will continue for the next 3-4 quarters.
• 99acres revenue is likely to grow at 18-20 percent unless there is heightened weakness in real estate market.
• Zomato has brought down cash burn by reducing discounts and better scale.

Morgan Stanley on M&M Financial

• Maintained ‘Overweight’ with a price target of Rs 425.
• Mgmt. says rural masses are holding back purchase decisions; growth likely to remain muted.
• Net interest margin has scope to improve.
• Credit costs are likely to be higher than in 2018-19.

Who’s Meeting Whom

• Manappuram Finance to meet Burgundy Asset Management and Kim Eng Securities on Nov. 22.
• Narayana Hrudayalaya to meet Add Capital, Nippon India MF and other investors from Nov. 22-27.
• Shriram City Union Finance to meet Investec Capital Services on Nov. 22.
• Sundram Fasteners to meet SBI MF on Nov. 22.

Insider Trading

• JSW Steel promoter JSW Holdings acquired 4 lakh shares from Nov. 18-19.
• Deepak Fertilizers & Petrochemicals promoter Yeshil Mehta acquired 1 lakh shares on Nov. 18.
• AVT Natural Products promoters acquired 1.37 lakh shares from Nov. 18-19.
• Ultratech Cement promoter IGL Holdings sold 1.9 lakh shares from Nov. 18-19.

Money Market Update

Sovereign bonds in India may drop on an overnight spike in crude prices and rise in U.S. treasury yields.

Traders will also focus on sale of Rs 16,000 crore of government bonds. Note that the global funds sold Rs 400 crore of sovereign bonds on Thursday. Yesterday, the yield on the 10-year government bond gained five basis points at 6.5 percent.

In the currency markets, the rupee is expected to open slightly weaker today. The implied opening from forwards suggest rupee may start trading at 71.74 to the dollar. Yesterday, the local legal tender gained 0.1 percent to 71.71 to the dollar as the government said it has no plan to revise the fiscal deficit targets.

F&O Cues

Index Futures

• Nifty Nov futures closed at 11,974.5, premium of 6 points versus 19 points.
• Nifty Nov Futures open interest down 3 percent sheds 4.7 lakh shares in open interest.
• Nifty Bank Nov futures closed at 31,316.7, discount of 33 points versus 32 points.
• Nifty Bank Nov futures series open interest down 2.5 percent, sheds 46,000 shares in open interest.

Options

• Nifty PCR at 1.52 versus 1.58 (across all series).

Nifty Monthly Expiry: Nov. 28

• Max open interest on call side at 12,000 (37.9 lakh shares).
• Max open interest on put side at 11,900 (28.7 lakh shares).
• open interest addition seen at 12,000C (+13.3 lakh shares) 12,500C (+6.4 lakh shares), 12.000P (+4.7 lakh shares).