Sensex, Nifty Halt Three-Week Rally; Rupee Strengthens Past 71/$

The India rupee strengthened further against the U.S. dollar. The home currency ended 1.07 higher against the greenback to 70.69, its highest levels in over three months.

Indian equity benchmarks ended lower for the third day, registering their first weekly decline in four.

The S&P BSE Sensex Index ended 0.62 prcent lower today at 34,981.02 and the NSE Nifty 50 Index closed at 10,526.75, down 0.69 percent.

The market breadth was tilted in favour of sellers. Ten out of 11 sectoral gauges compiled by NSE fell, led by the NSE Nifty Metal Index's 1.7 percent decline. On the flipside, the NSE Nifty Media Index was the only sectoral gainer, up 1.42 percent.

Shares of Vodafone Idea fell as much as 8.3 percent to Rs 40.85.

About 24.8 lakh shares changed hands in a single block deal, Bloomberg data showed. Buyers and sellers were not known immediately.

Maharashtra Seamless

• Stock rose as much as 12.3 percent to Rs 526.15.
• Trading volume was more than 10 times its 20-day average.

Capital First

• Stock rose as much as 9.5 percent to Rs 544.35.
• Trading volume was six times its 20-day average.

Timken India

• Stock fell as much as 3.6 percent to Rs 501.
• Trading volume was more than 16 times its 20-day average.

European equities resumed declines after yesterday’s short reprieve as technology shares led the retreat along with mining stocks.

Shares of the pharmaceutical company rose as much as 23.6 percent, its highest ever intraday gain, to Rs 206.40.

The U.S. drug regulator concluded their inspection on two facilities of its plant in Goa with two minor observations, according to its stock exchange notification. The facility had received a Warning Letter from the U.S. FDA in March 2017, the statement added.

Trading volume was 10.5 times its 30-day average, according to Bloomberg data. The stock fell 25.9 percent so far this year compared to a 5.9 percent advance in the Sensex.

Shares of Deepak fertilisers rose as much as 17.4 percent, the most since August 2016 to Rs 192.50.

The company said that the normal operations had resumed fully as the Income Tax team conducting search and seizure operations left the company’s offices, according to its stock exchange notification.

Trading volume was more than 30 times its 20-day average, according to Bloomberg data. The stock has declined 55 percent in the past 12 months.

• Indian equity benchmarks erased early gains.
• The S&P BSE Sensex Index fell over 200 points from day’s high and the NSE Nifty 50 Index slid below 10,600.
• Nine out of 11 sectoral gauges compiled by NSE fell, led by the NSE Nifty Metal Index’s 1.52 percent decline.
• On the flipside, the NSE Nifty Media Index was the top sectoral gainer, up 1.26 percent.

Shares of paper products maker fluctuated between gains and losses to trade at Rs 208.

The company received closure directions from Maharashtra Pollution Control Board on Nov. 20 for its Thane Plant, it said in a stock exchange filing. The company has filed a writ petition in Bombay High Court on Nov. 21. The plant had contributed about 10 percent of the annual turnover of the company for the financial year ending December 2017. The company said that it shall divert customer orders to other plants in India to ensure the continuity of supplies to customers.

Trading volume was almost 18 times its 20-day average, according to Bloomberg data.

• Indian equity benchmarks traded off day’s high.
• The S&P BSE Sensex Index rose 0.18 percent to 35,264.01 and the NSE Nifty 50 Index rose 0.1 percent to 10,611.50.
• About 935 stocks advanced and 721 shares declined on NSE.

Shares of Vakrangee hit its upper circuit of 5 percent to trade at Rs 25.35.

The Economic Offences Wing (EOW) have not found any substance in the complaint relating to the price or volume manipulation in the firm and have closed the enquiry, the company said in its stock exchange filing.

The stock fell nearly 94 percent so far this year.

The NSE Nifty IT Index rebounded after a two-day sell-off amid strengthening rupee. The gains were led by the Rally in Mindtree Ltd. followed by Tata Consultancy Services Ltd.

Nifty’s 10,700 call option contract was among the most active option contracts on National Stock Exchange.

Premium on the contract fell 29.84 percent to Rs 38.80. Over 3.78 lakh shares were added to the open interest which stood at over 36.72 lakh shares.

Shares of Forbes & Co rallied for the third day and is poised for its longest gaining streak in over a month. The stock rose as much as 9.2 percent to trade at Rs 2,699, its highest levels since Sept. 11.

“The company plans for a separate listing of Eureka Forbes Ltd., the water purification unit of publicly traded Forbes & Co., and sales of the commercial real estate will also be considered,” Bloomberg reported on Nov. 20 quoting its Executive Director Jai Mavani. (More details here)

Trading volume was almost 30 times its 20-day average, Bloomberg data showed. The Relative Strength Index was above 70, indicating that the stock may be overbought.

Shares of the natural gas distributor rose as much as 15.4 percent to Rs 112.

Trading volume was 13 times its 20-day average, according to Bloomberg data. The stock rose over 45 percent since its listing on Nov. 05.

About 11.2 lakh shares of Reliance Communications changed hands in a single block deal, according to Bloomberg data. Buyers and sellers were not known immediately.

Shares of the credit rating agency extended decline for the second day and fell as much as 1.5 percent to trade at Rs 987, its lowest levels since July 2016.

Trading volume was double its 20-day average, Bloomberg data showed. The stock traded at 17.3 times estimated forward earnings per share compared to 23.8 times for the two-year historical average.

Shares of the natural gas distributor pared losses and rose as much as 1.3 percent to Rs 269.10.

About 10 lakh shares changed hands in a single block deal, according to Bloomberg data. Buyers and sellers were not known immediately.

The stock traded at 21 times its estimated earnings per share for the coming year, Bloomberg data showed.

Shares of Taj Group hotels operator rose as much as 8.9 percent, the most in nearly two-and-a-half years, to trade at near a six month high at Rs 147.

Homegrown brokerage and research firm Motilal Oswal initiated coverage on the stock with a 'Buy' rating and a price target of Rs 163, implying a potential upside of 19 percent from the last regular trade, according to its research report.

Key highlights from the brokerage report:

• Attractive play on upcoming industry upcycle; market dynamics to turn favourable.
• 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.

Indian equity benchmarks opened higher, snapping their two-day decline. The S&P BSE Sensex Index rose as much as 0.32 percent to 35,314 and the NSE Nifty 50 Index rose as much as 10,625.95.

The market breadth was tilted in favour of buyers. Seven out of 11 sectoral gauges compiled by NSE advanced, led by the NSE Nifty IT Index's 0.54 percent gain. On the flipside, NSE nifty Realty Index was the top sectotal loser, down 0.2 percent.

The Indian rupee strengthened for the seventh day in a row against the U.S. dollar and is poised for its longest winning streak in over 21 months.

The home currency opened at 71.13 against the greenback, appreciating 0.46 percent. It further appreciated as much as 0.5 percent. Traders expect the pair to stay in a range of 70.80-71.20 a dollar in the day.

India's sovereign bonds are likely to gain tracking the recent selloff in crude prices after the market reopens for trading after the Wednesday holiday. RBI will auction Rs 12,000 crore of bonds as well as purchase Rs 8,000 crore of the government debt via open market operation today. The yield on the 10-year note may trade in a range of 7.72-7.80 percent in the day.

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.

On Vodafone Idea

UBS

• Maintained ‘Neutral’ with a price target of Rs 37.
• Rapid expansion of 4G coverage in coming 6-12 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.
• Mgmt. 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.

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

• 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.

• Congress within striking distance of power in Rajasthan, says Sachin Pilot.
• J&K Governor dissolves assembly after Mufti, Sajjad Lone stake claim.
• The Fed’s likely to take a rate-hike breather in 2019.
• Half of India ATMs may close in five months on unviability.
• European Union unveils policy paper on boosting ties with India.
• Reliance Jio to replace Bharti Airtel as service provider to Railways.
• Lodha is richest Indian Property Tycoon with $3.8 billion wealth.
• May plans last-minute Brussels dash to save Brexit Summit.
• Trump thanks Saudis for low oil prices amid uproar over killing.
• Weak investment leads signs of cooling momentum in U.S. Economy.
• Apple iPhone supplier Foxconn planning deep cost cuts.

• 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.

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.

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 were little changed with volumes subdued after their U.S. counterparts 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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