All You Need To Know Going Into Trade On Sept. 25 

Asian stocks were off to a muted start Tuesday after U.S. stocks slipped on growing concern about the outlook for global trade and American politics.

Equity benchmarks were little changed in Japan, which returned from a holiday, and Australia. China's markets also will resume trading after long weekend, while markets in Hong Kong and South Korea are shut Tuesday.

The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index's performance in India, was little changed at 10,996 as of 7:31 a.m.

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BQ Live

U.S. Market Check

• Stocks slipped on growing concern about the outlook for global trade and U.S. politics.
• The yield on 10-year Treasuries was steady at 3.09 percent, near the highest since May.

#BQMarketWrap | U.S. stocks fall on politics and trade risks; oil gains.

Read: https://t.co/Q6SZKA8SXU pic.twitter.com/kN7PdBdyca

Europe Market Check

• European stocks closed mostly lower, with investors spooked by a new round of trade tariffs on Chinese goods taking effect in the U.S., and no signs of a breakthrough on Brexit.

Asian Cues

• Japan's Topix index rose 0.3 percent.
• Australia's S&P/ASX 200 Index was flat.
• FTSE China A50 futures lost 0.2 percent.
• S&P 500 futures declined were little changed.

Commodity Cues

• West Texas Intermediate crude was little changed at $72.14 a barrel after jumping 2.2 percent Monday.
• Brent crude traded 0.1 percent higher at $81.27 a barrel.
• Gold was flat at $1,199.01 an ounce.
• LME copper slid 1 percent to $6,290 a metric tonne.

Shanghai Exchange

• Steel traded lower for the third day; down 0.5 percent.
• Aluminium snapped three-day winning streak; down 0.2 percent.
• Zinc traded lower; down 0.1 percent.
• Copper traded higher for the second day; up 1 percent.
• Rubber traded higher for the fourth session; up 0.3 percent.

Petrol/diesel prices hiked across major cities. In the last one month, petrol/diesel prices in Delhi hiked by Rs 5.19/4.94 per litre. ⛽️

Read: https://t.co/2Udpfng2HI pic.twitter.com/nM8G6F4qEw

Here are the key events to watch out for this week:

• Japanese Prime Minister Shinzo Abe meets with President Donald Trump in New York to discuss trade.
• The Fed decision on Wednesday will be followed by a press conference with Chairman Jerome Powell.
• Thursday sees durable goods, GDP data and jobless claims for the U.S.

Indian ADRs

Stocks To Watch

• Yes Bank re-appointed Rana Kapoor as the MD and the CEO. The bank also gave the credit cost guidance for financial year 2019 at 50-70 basis points and said that it was committed to protect shareholder's interests. The board meet of the company is scheduled today to decided the course of action post RBI curtailing term of Rana Kapoor.
• SBI Life Insurance said that BNP Paribas Cardiff may cut stake in the company to comply with minimum shareholding norms. The company also said that BNP Paribas Cardiff had confirmed that it was yet to make any firm decision regarding the size, timing or nature of such potential reduction in their shareholding of the company. The foreign institution held 22 percent stake in SBI Life Insurance as reported to the exchanges for the June quarter.
• Infosys received IT digitisation solution order worth CAD $80.3 million from Public Services and Procurement Canada to modernize and automate their procurement processes. The company will be working with Ernst & Young and SAP Canada for this project.
• Mangalam Drugs and Organics received approval from World Health Organization for its drug Efavirenz.
• Dilip Buildcon declared L1 bidder for an EPC project worth Rs 601.02 crore by Water Resource Department (Kota), Rajasthan.
• IndusInd Bank said IL&FS Securities & Services transaction was progressing and that the deal completion is on track. All regulatory approvals barring one are in place for this transaction. On June 26 the bank had announced the signing of definitive agreements with IL&FS and other minority shareholders to acquire 100 percent stake in ISSL.
• Zensar Technologies was chosen by U.K. based investment company Ruffer LLP to manage its end to end infrastructure requirements. The company also announced the launch of its insurance model which will help in digitisation across the insurance vertical.
• Adlabs Entertainment signed a memorandum of undertaking with Riverbay Group to operate a new entertainment park in Andhra Pradesh's Amaravathi. The company said that the new park will expand Imagica's brand presence in South India.
• Dena Bank's board approved the proposed merger with Bank of Baroda and Vijaya Bank.
• Canara Bank filed insolvency application against GTL Infrastructure.
• Himachal Futuristic Communications received purchase orders for Rs 558.36 crores from BSNL for PAN Indian defence communication network.

Offerings

• Aavas Financiers IPO opens today. Issue price 818 - 821 per share.
• Garden Reach IPO enters second day. The issue subscribed 1 percent on the first day. (More details here)

Bulk Deals

Care Ratings

• The Pabrai Investment Fund II LP acquired 5.12 lakh shares or 1.74 percent at Rs 1,224.93 apiece.

Who's Meeting Whom

• Greaves Cotton to meet LIC Mutual Fund, Enam Holdings and other investors from Sept. 25-27.
• Bharat Forge to meet SBI MF, Mitsubishi UFJ and Morgan Stanley Investment Management from Sept. 25-28.
• PI Industries to meet Cholamandala Securities, Emkay Global and other investors from Sept. 25-28.

Insider Trades

• PPAP Automotive promoter group acquired 1,600 shares on Sept.12.
• Man Infraconstruction promoter Parag Shah acquired 2 lakh shares on Sept. 21.
• PSP Projects promoter and director Prahaladhbhai Patel acquired 11,000 shares from Sept. 19-21.

(As reported on Sept. 24)

Trading Tweaks

• Central Bank of India's circuit filter revised to 10 percent.
• HDIL's circuit filter revised to 5 percent.
• Granules and HCC to be excluded from F&O with effect from December contracts.
• Kirloskar Pneumatic last trading day before stock split to Rs 2 from Rs 10 each.

Money Market Update

• Rupee dives 43 paise to 72.63 against the U.S. dollar as crude reclaims $80 mark. The home unit snapped two-day winning streak; ends 0.6% lower against the dollar.
• The sovereign bond declined for second day. The 10-year benchmark bond yield rose four basis points to 8.12 percent.

F&O Cues

• Nifty September futures closed trading at 10,998 at premium of 31 points versus 23 points.
• September series: Nifty open interest down 11.8 percent; Bank Nifty open interest down 8 percent.
• Nifty rollovers at 18 percent; Nifty Bank Rollovers at 16 percent.
• India VIX ended at 17.4, up 12.2 percent.
• Max open interest for September series at 11,500 strike price call option (open interest at 30.6 lakh, open interest down 9 percent)
• Max OI for Sep series at 11,000 strike price put option (open interest at 34 lakh, open interest down 11.4 percent)

F&O Ban

• In Ban: Adani Enterprises, Adani Power
• Out of Ban: Wockhardt

Put-Call Ratio

• Nifty PCR at 1.05 versus 1.14.
• Nifty Bank PCR at 0.53 versus 0.6.

Brokerage Radar

Macquarie on Metals

• Expect zinc, lead and silver prices to be lower, while aluminium and alumina prices to be higher.
• Believe fundamentals are intact and see attractive value in select metal equities.
• Expect global demand to remain supportive at least through 2019; Weak rupee is an added tailwind.
• Hindustan Zinc: Downgraded to ‘Underperform' on earnings headwinds and premium valuation.
• JSW Steel: Downgrade to ‘Neutral' as it is trading at fair valuation.
• Top Buys: Hindalco, Coal India, Nalco and Graphite India.

Goldman Sachs on Eicher Motors

• Maintained ‘Buy' with a price target of Rs 37,358, implying a potential upside of 44 percent from the last regular trade.
• The company will launch two new motorcycles in foreign and domestic market.
• New launches a key catalyst for the stock.
• New launches a huge leap in terms of engineering, quality and design.
• Watch out for: Launch price, initial feedback and export volume expectations.

CLSA on ITC

• Maintained ‘Buy' with a price target of Rs 390, implying potential upside of 31 percent from the last regular trade.
• Proposal for an additional ‘disaster cess' to help Kerala post the floods.
• Proposal is likely to come up for discussion at the GST Council meet on Sept. 28.
• Effective tax hike of 5-6 percent is manageable for ITC to meet earnings estimate.

BofA ML on Cummins India

• Maintained ‘Buy' with a price target of Rs 864, implying a potential upside of 25 percent from the last regular trade.
• Demand revival, cost optimisation to drive margin expansion.
• Domestic gensets likely to revive; Exports have likely bottomed.
• Industrials to remain a key growth driver.

CLSA on Real Estate

• Property stocks down on higher interest rates, accounting changes and liquidity issues of lenders.
• Weak performance comes even as sales have started to pick-up.
• Visible value stocks should be easy buys.
• Stay positive on the sector with Godrej Properties our top pick.
• See Oberoi Realty and Prestige Estates as high value stocks.

Kotak on Consumer Sector

• Sector still expensive; search for value still a futile exercise.
• Earnings prognosis a mixed bag with volume prognosis improving a tad.
• Risks to margin improvement thesis rising as well.
• Remain cautious overall; ITC, Britannia, Nestle, Jubilant Foodworks and Colgate are preferred picks.

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