Stocks in Asia were mostly lower Wednesday as investors took a breather after four weeks of gains. Ten-year Treasury yields dipped to the lowest since November 2016 following a disappointing run of economic data.
Japanese shares slipped with equities in Korea and Hong Kong, while those in Australia edged higher. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, rose 0.2 percent to 11,965 as of 7:15 a.m.
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BQ Live
U.S Market Update
U.S. stocks edged higher to a fresh record, while Treasury yields were back near 20-month lows following a disappointing run of economic data.
#BQMarketWrap | Treasuries, gold surge as U.S. stocks advance.
Read: https://t.co/oEgfiMW296 pic.twitter.com/1VA32PMS3SAsian Cues
- Futures on the S&P 500 Index slid 0.1 percent.
- Japan's Topix fell 0.7 percent.
- Australia's S&P/ASX 200 Index was little changed.
- Kospi also little changed.
Commodity Cues
- Brent crude rose 0.77 percent to $62.88 a barrel. It closed 4.09 percent lower yesterday.
- West Texas Intermediate crude gained 0.4 percent to $56.50 a barrel after sliding Tuesday.
- Gold rose 0.8 percent to $1,429.30.
London Metal Exchange
- Copper ended lower for second day, down 1.13 percent.
- Nickel ended lower for the third day, down 2.06 percent.
- Tin ended 6.35 percent lower.
- Zinc ended 0.69 percent higher.
- Aluminium ended lower for the second day, down 0.67 percent.
- Lead ended lower for the third day, down 0.58 percent.
Indian ADRs
Stocks to Watch
- Graphite India received nod from Karnataka State Government to close Bengaluru plant. Production has been closed since Feb 21. On April 3 Board approved a proposal to permanently close operations in the Bengaluru plant within such time as is required by the company to obtain appropriate consents, approvals, authorizations and no objections.
- L&T stated that it holds 60.06 percent stake in Mindtree. On July 2 the company had made payment to shareholders of Mindtree who had tendered their shares on Open Offer. The offer lasted from June 17 to June 28.
- Tata Sponge Iron stated in their press release that promoter Tata Steel will subscribe to its full entitlement of rights in the issue and will acquire any additional rights equity share. Tata Steel will participate in the Rights Issue to the extent of 90 percent of Rights Issue. i.e. up to Rs 1,485 crore.
- Electrosteel Castings has commenced commercial production at its Ferro Allow Plant in West Bengal with effect from July 1.
- Jammu & Kashmir Bank clarified that FIR has been registered against the firm and officials of the Bank by Anti-Corruption Bureau of Kashmir Government and the matter is being investigated. The company stated in the press release that they don't forsee any financial impact on the Bank as the account in question had already been declared as NPA and adequate provisions as mandated under regulatory guidelines have been made against the same.
- Government of India to revive five closed fertilisers at a cost of Rs 37,971 crore to reduce import of Urea. (Press Information Bureau of India)
- Adani Power stated that Supreme Court has announced that a civil appeal by company's arm Adani Power (Mundra) for cancellation of PPA having 1000MW Capacity with Gujarat Urja Vikas Nigam has been allowed.
- Aditya Birla Fashion & Retail: Board approved acquiring entire stake in Jaypore E-Commerce and TG Apparel for Rs 104 crore.
- Tata Communications Vinod Kumar has resigned as MD and Group CEO with effect from July 5.
- RBI Imposed Penalty of Rs 50 Lakh on UCO Bank , Allahabad Bank, Punjab National Bank each and penalty of Rs 25 lakh on Corporation Bank. Penalty Imposed Due to Non-Compliance of RBI Directives on KYC Norms and Opening of Current Accounts.
- Kalpataru Power Transmission board approved acquiring 19.94 percent stake in Shree Subham Logistics for Rs 64.66 crore. With this acquisition the company holds 100 percent stake in the target company.
- Shoppers Stop Aditya Birla Sun Life MF increased stake from 5.01 percent to 7.01 percent in the company.
- City Union Bank entered into an agreement with Star Health and Allied Insurance for distribution on insurance products on July 2.
- Adani Power: Supreme Court allowed cancellation of power purchase agreement with Gujarat Urja Vikas Nigam Ltd. having 1000 MW capacity.
- Indiabulls Ventures' wholly owned consumer finance subsidiary disbursed 9.2 lakh loans in the first quarter of the current financial year as compared to 4.9 lakh in fourth quarter of the previous financial year and 0.6 lakh in the first quarter of 2017-18.
- Reliance Home Finance: CARE Ratings downgraded its rating for non-convertible debentures of Rs 400 crore to D primarily due to rescheduling of non-convertible debentures.
Bulk Deals
Bharat Financial Inclusion
- Goldman Sachs Singapore acquired 8.78 lakh shares or 0.63 percent equity at Rs 904.1 each.
- Integrated Core Strategies (Asia) acquired 18.06 lakh shares or 1.29 percent equity at Rs 898.24 each.
- Vanguard Fund sold 33.14 lakh shares or 2.36 percent equity at Rs 899.32 each.
- Ishares Core Emerging Markets Mauritius sold 9.38 lakh shares or 0.67 percent equity at Rs 899 each.
Eros International Media
- Tata Capital Financial Services sold 12.87 lakh shares or 1.35 percent equity at Rs 17.59 each.
- Anand Rathi Global Finance sold 5 lakh shares or 0.52 percent equity .
Pledge Share Details
- Emami: Axis Trustee released pledge of 2.9 crore shares from February 27-July 1, Promoters revoked pledge of 78.9 lakh shares and created a pledge of 1.95 crore shares on July 1.
Trading Tweaks
- UPL record date for share bonus at 1:2.
- Aarti Industries ex-date for demerger.
- Bharat Financial Inclusion ex-date for amalgamation.
- Mukand Engineers ,Excel Realty N Infra ,Uttam Galva Steels to move into short term ASM Framework.
- Magadh Sugar & Energy to move out of short term ASM Framework.
Who's Meeting Whom
- Ircon Capital to meet Karma Capital on July 4.
Insider Trading
- Mindtree promoter L&T acquired 5.2 crore shares from June 17-28.
- Syngene International promoter group Biocon Employee Welfare Trust sold 8.12 lakh shares on June 28.
- JK Lakshmi Cement promoters acquired 3.1 lakh shares on June 28.
- Shriram Transport Finance promoter Shriram Capital acquired 3.74 lakh shares on June 27.
Money Market Update
India's rupee and sovereign bonds may gain as crude oil prices plunged after the OPEC meeting.
Gains in bonds are, however, likely to tempered by the Reserve Bank of India's move to drain liquidity via longer reverse repos. The central bank will hold a reverse repo auction of Rs 25,000 crore for a tenor of 63 days on Wednesday, with the auction part of a plan to absorb some of the surplus liquidity in the banking system.
India's 10-year bond yield fell four basis points at 6.84 percent Tuesday, with yields having shaved off 47 basis points in the three months through June.
In the rupee market, implied opening from forwards suggests spot will start trading around 68.90. It ended at 68.94 on Tuesday, with focus now turning to Friday's budget.
Futures And Options
July Futures
- Nifty futures closed at 11,942, premium of 32 points versus 38 points.
- Nifty futures OI down 3 percent, sheds 4.8 lakh shares in open interest.
- Bank Nifty futures closed at 31,403.9, premium of 120.6 points versus 124 points.
- Bank Nifty futures across series open interest up 1 percent, adds 21,000 shares in open interest.
Options
- Nifty PCR at 1.46 versus 1.36 (across all series)
Nifty Weekly Expiry July 4
- Max open interest on call side at 12,000 (24.8 lakh shares).
- Max open interest on put side at 11,800 (24.4 lakh share).
- Open interest addition seen in 11,850P (+8.2 lakh shares), 11,900P (+6.2 lakh shares).
- Open interest shedding seen in 11,800C (-4.3 lakh shares), 11,900C (-3.7 lakh shares).
Nifty Monthly Expiry July 25
- Max open interest on call side at 12,000 (15.2lakh shares).
- Max open interest on put side at 11,500 (16.6lakh shares).
Stocks In F&O Ban
- In Ban: DHFL
Brokerage Radar
HSBC on Aster DM Health
- Maintained ‘Buy' with a price target of Rs 205.
- Presence across income segments/value chain to support strong revenues and margins.
- Both the Middle East and Indian operations moving ahead as planned.
- Aster trades at an over 40 percent discount to peers; Hard to ignore the valuation gap.
CLSA on ITC
- Maintain Buy with a price target of Rs 365.
- Lower GST collection growth rate could lead to higher cess rates which is negative for tobacco.
- Until GST growth trajectory improves, concerns rise on ITC stock.
- Stock appears attractive, but faces uncertainty.
Credit Suisse on Shriram Transport
- Maintained ‘Neutral' with a price target of Rs 1,100.
- Management expects volumes to pick up in the second half due to BS-VI migration.
- Current financial year's growth expected to be back ended as per management.
- Discussions on merger with group companies still on.
Citi on Tata Power
- Maintained ‘Buy' with a price target of Rs 76.
- Practice of regulatory asset creation may be stopped.
- Existing stock of regulatory assets could get cleared.
- Tata Power could be a big beneficiary.
- Delhi distribution asset liquidation on the anvil.
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