All You Need To Know Going Into Trade On Sept. 21

Stocks in Asia look set to round out two strong weeks on a high after U.S. equities climbed to fresh records and concerns surrounding trade tensions showed signs of easing.

Japan's Topix index is on course for the best week in two years, while futures signaled gains when markets open in China and Hong Kong. Emerging-market assets continued to rally from recent lows.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, traded 0.4 percent higher at 11,353 as of 6:55 a.m.

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BQ Live

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

U.S. Market Check

• U.S. stock benchmarks reached new highs Thursday on news from China about tariff and currency moves that could ease trade tensions.

#BQMarketWrap | S&P, Dow Soar to record highs as trade fears abate.

Read: https://t.co/EuJ1LjvNGo pic.twitter.com/ox4OmKXQvG

Europe Market Check

• European equities advanced the most since July as cyclical industries rose amid fading fears over trade.

Asian Markets

• Japan's Topix index gained 0.5 percent.
• Australia's S&P/ASX 200 Index gained 0.2 percent.
• South Korea's Kospi index added 0.4 percent.
• Futures on Hong Kong's Hang Seng Index advanced 0.7 percent.
• FTSE China A50 Index futures rose 0.4 percent.
• Futures on the S&P 500 Index held steady.
• The MSCI Emerging Market Index is on course for a second week of gains.

Commodity Cues

• The Bloomberg Commodity Index rose 0.6 percent Thursday.
• West Texas Intermediate crude fell 0.1 percent to $70.25 a barrel.
• LME copper rose 1 percent to $6,144 a metric tonne.
• Gold was flat at $1,207.69 an ounce.

Shanghai Exchange

• Steel traded higher; up 0.1 percent.
• Aluminium traded higher for third day; up 0.8 percent.
• Zinc traded higher for fourth day; up 0.1 percent.
• Copper traded higher; up 0.1 percent.
• Rubber traded higher for third session; up 0.8 percent.

Indian ADRs

Stocks To Watch

• Yes Bank received RBI's letter stating that Rana Kapoor can continue to be the bank's managing director and CEO till Jan. 31, 2019. The board will meet on Sept. 25 to discuss future course of action.
• ICICI Bank to consider raising offshore raising of funds via debt instruments on Sept. 24. SEBI also clarified that the bank and Chanda Kochhar have filed replies to the show-cause notices but they have not received any settlement application from the bank or any other related entity.
• Jet Airways' books are being inspected by the Income Tax Department for alleged falsification of accounts and suspicious transactions. Inspection started across four premises of the airlines across Mumbai and Delhi. As part of the survey operations, tax sleuths will only visit the business premises of a firm and check their books of accounts. (Press Trust of India)
• ITC Hotels acquired Park Hyatt Goa Resort and Spa. The company said that this acquisition is a part of auction held by Industrial Finance Corporation of India for Rs 541 crore and upheld by the Supreme Court in its March 19 judgement, according to a PTI report.
• Manali Petrochemicals started the supply of Notedome Products from Sept. 19.
• CEAT launched high speed range of CEAT SecuraDrive tyres. These products will cater to the premium sedan segment of cars in India.
• NBCC secured business of Rs 921.67 crore for the month of August.
• Life Healthcare South Africa sold 49.7 percent stake in Max Healthcare to Radiant Life. Max Healthcare is a 50 percent subsidiary of Max India.
• Karnataka State Pollution Board said that the Bengaluru units of Graphite India should be shut down, Times of India reported. The company clarified to the news and said that its stack emissions are well within prescribed norms and it is a law abiding entity.
• Australian Competition and Consumer Commission announced clearance of the merger of Arrow Pharmaceuticals, a subsidiary of Strides Pharma Science and Apotex Australia.
• Bharti Airtel, Jio said to be among bidders for Aircel assets, according to Mint report.
• Clariant Chemicals (India) to divest plastics and coatings business by 2020 because of parent company's stated intent to do so globally. Implications of this strategic decision will be given in next few months.
• Aditya Birla Finance filed an arbitration before High Court of Delhi against the IL&FS Transportation Networks. The court has passed an interim order injuncting company from transferring or creating third party interest in their unencumbered assets till the next date of hearing fixed on Dec. 07.
• Gravita expanded its production capacity of Andhra Pradesh plant by adding new washing line and PPCP Granules extrusion lines with annual capacity or 4,800 MTPA.
• Dilip Buildcon declared as L-1 bidder for Metro rail project for Rs 228.96 crore by Madhya Pradesh Metro Rail Co, Urban Administration. Construction period for the project is 27 months.
• Fitch revised outlook on Tata Motors to Negative; Affirms at 'BB+'. The revision of the outlook reflects Fitch's expectations of rising negative free cash flow (FCF) over the next two financial years.

Offerings

• Ircon International IPO subscribed 9.7 times on the final day of subscription.
• Dinesh Engineers to sell shares at Rs 183-185 each in IPO starting Sept. 28.

Bulk Deals

• Marshall Machines: Ashish Kacholia acquired 99,000 shares at Rs 43.15 each. (The company is listed SME on NSE Emerge).
• Solara Active Pharma Sciences: Karst Peak Asia Master Fund sold 1.83 lakh shares or 0.74 percent equity at Rs 286.02 each.

Who's Meeting Whom

• Aurobindo Pharma to meet investors on Sept. 21.
• IIFL Holdings to meet Progressive India Fund, Motilal Oswal AMC and Morgan Stanley from Sept. 21-24.

Insider Trades

• Dish TV India promoter World Crest Advisors LLP acquired 30 lakh shares on Sept. 19.
• Elpro International promoter acquired 5 lakh shares on Sept. 17.
• Balaji Telefilms promoter Ekta Kapoor acquired 12,500 shares on Sept. 17.

(As reported on Sept. 19)

Trading Tweaks

• Rolta India circuit filter revised to 10 percent.

Money Market Update

• Rupee snapped two-day losing streak, up 0.8 percent to 72.38 against the dollar
• Sovereign bond gains, as yield on 10-year benchmark security dropped seven basis points to 8.07 percent.

F&O Cues

• Nifty September futures ended at 11,273, with a premium of 39 points.
• Nifty September open interest (OI) down 2.6 percent and Nifty Bank September OI up 4.3 percent.
• Max OI for September series call at 11,500 strike price call option, OI at 41.7 lakh shares.
• Max OI for September series put at 11,200 strike price put option, OI at 35.6 lakh shares.

F&O Ban

• In ban: Adani Enterprises, Balrampur Chini, Wockhardt
• New in ban: Wockhardt

PCR

• Nifty 1.14 versus 1.20.
• Nifty Bank 0.43 versus 0.58.

Brokerage Radar

Jefferies on Graphite India

• Maintained ‘Buy' with a price target of Rs 1415, implying a potential upside of 48 percent from the last regular trade.
• Closure of Bengaluru facility to not impact volumes.
• Power cost to increase if the company would start graphitisation at Nasik facility
• Impact on operating income would be less than 0.5 percent.

CIMB on NMDC

• Maintained ‘Add'; raised price target to Rs 161, implying a potential upside of 36 percent from the last regular trade.
• Expect higher iron ore prices; global ore prices to remain stable.
• NMDC to benefit from likely mining disruption in Odisha.
• Steel plant when commissioned can add Rs 35 per share to the price target.

UBS on Havells India

• Maintained ‘Sell'; hiked price target to Rs 540 from Rs 500, implying a potential downside of 16 percent from the last regular trade.
• Strong brand franchise visible but priced in.
• Scope of further premiumisation low.
• Lloyd performance bears watching.

HSBC on Grasim

• Maintained ‘Hold'; cut price target to Rs 1,140 from Rs 1,190, implying a potential upside of 7 percent from the last regular trade.
• VSF and caustic business continue to shine, boosting standalone earnings.
• Believe continued weakness in other business will have an offsetting effect.
• Sharp decline in ABC and Idea market caps has been a major drag on share price.

CLSA on Infosys

• Maintained ‘Buy' with a price target of Rs 780, implying a potential upside of 8 percent from the last regular trade.
• Infosys sees optimism in BFSI and outsourcing momentum in Europe.
• Deal wins better, digital focus stays, pricing pressure normalised.
• Proactive capital allocation, senior exits not a worry.

Brokerages On Yes Bank

IDFC Securities

• Downgraded to ‘Underperform' from ‘Neutral'; cut price target to Rs 230 from Rs 350, implying a potential downside of 28 percent from the last regular trade.
• Cut in Rana's tenor is a very big negative for Yes Bank.
• Rana's absence will slow down loan and fee growth.
• Could also impact bank's ability to raise high net worth deposits.
• This risk has not been priced in; expect significant correction.

Citi

• Downgraded to ‘Sell' from ‘Buy'; cut price target Rs 270 from Rs 440, implying a potential downside of 15 percent from the last regular trade.
• Believe there is premium attached to the stock due to Rana Kapoor.
• Likely that bank will have to defer its capital raise plans.
• Delay in capital raise to impact growth.
• Time period of over four months could prove short to find a suitable external candidate.

Macquarie

• Maintained ‘Outperform' with a price target of Rs 425, implying a potential upside of 33 percent from the last regular trade.
• Rejection is a major negative development.
• Expect a sharp gap-down opening on Friday.
• Absence of any communication from Yes Bank or RBI will be an overhang on stock.

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