All You Need To Know Going Into Trade On Jan. 2

Chinese equities started the year with gains, led by the H-share index in Hong Kong, as property stocks soared and a gauge of manufacturing strength beat expectations.

The Singapore traded SGX nifty, an early indicator of Nifty 50 index performance in India, fell 0.42 percent at 10,514 as of 7:05 a.m.

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DayBreak

Asian Cues

• An index of Chinese H shares climbed 2.4 percent in Hong Kong, the biggest gain since Nov. 21
• The Hang Seng Index and gauges in Shanghai and Shenzhen also rose. Property stocks were among the main gainers.
• South Korean and Singaporean stocks crept higher, while Australia's benchmark edged lower.
• Markets in Tokyo are closed until Thursday for Japanese holidays, while New Zealand is also off Tuesday.

Data Watch

• The China Caixin manufacturing PMI showed a December reading of 51.5, beating the expected 50.7 and up from 50.8 the previous month. That positive figure followed Monday's release of the official China manufacturing PMI, which at 51.6 still represented expansion in December.

• Other data Tuesday showed Indonesia's manufacturing PMI dropping to 49.3, Malaysia's falling to 49.9 and the Philippines' at 54.2. Singapore reported fourth-quarter economic growth of 3.1 percent, beating estimates.

What To Watch For

• Nikkei India manufacturing PMI for December to be released today.
• U.K. Markit manufacturing and U.S. Markit manufacturing PMIs are due later Tuesday.
• Indonesia reports December CPI

Commodity Cues

• Brent crude ended higher at $66.87/barrel, up 1.1 percent.
• WTI crude ended higher at $60.42/barrel, up 1 percent.
• Spot Gold trades higher at $1,307 an ounce; up 0.3 percent.
• Sugar ended near one-month high at 15.16; up 1.1 percent.

Coal power's pace slows in India as glut leaves plants unused.https://t.co/vmcwN5B7BU pic.twitter.com/GSvoxp2XQY

Stocks To Watch

• Salil Parekh to take over as Infosys CEO, MD today.
• Prestige Estates to buy Capitaland's stake in various entities for Rs 342 crore.
• Bajaj Hindusthan successfully implements S4A scheme.
• PVR opens three-screen multiplex in Ghaziabad taking its total tally to 603 screens at 132 properties in 51 cities.
• Acrysil Ltd. acquires additional 3.75 percent stake in U.K. based Homestyle products Ltd for Rs 27.3 crore in a debt-free, cash-free deal.
• GAIL commissions India's second largest rooftop solar plant.
• Idea Cellular to consider fund raising on Jan. 4
• SRF commissions 40,000 tonnes per annum chloromethanes plant at Dahej.
• NLC commissions 130 MW solar power project at Neyveli.
• Future Consumer allots 6.68 crore equity shares to International Finance Corporation on conversion of CCDs.
• Thermax wins Rs 327 crore order for a co-generation power plant.
• JM Financial seeks shareholders' approval to raise Rs 650 crore.
• Kiri Industries says promoter Equinaire Chemtech acquires 24 lakh shares on conversion of warrants.
• Coal India Dec. output stands at 5.46 crore tonne versus 5.88 crore tonne target.
• Axis Bank to sell Rs 2,000 crore Bhushan Steel loan (Economic Times).
• Adani Power, Neyveli Lignite and Sembcorp Vie to buy stake in GMR's power projects (Economic Times).
• ITC, JK Paper Among Potential Suitor For Sirpur Paper (Mint).

Banks gear up to refer as many as 24 of large stressed accounts to NCLT. https://t.co/QMVtUVQAIr

December Auto Sales

• Eicher Motors' sales rose 17 percent to 66,968 units.
• TVS Motor's sales jumped 39 percent to 2.56 lakh units.
• Mahindra and Mahindra's sales grew 8 percent to 39,200 vehicles.
• Escorts' sales rose 13.1 percent to 3,606 units.
• Maruti Suzuki's sale rose 10.3 percent to 1.3 lakh units.

Bulk Deals

• Nandan Denims: LTS Investment Fund bought 2.41 lakh shares (0.5 percent) at Rs 164.5 each
• Subex: QVT Mauritius West Fund – FCCB A/C sold 34.76 lakh shares (0.6 percent) at Rs 10.42 each
• Gujarat NRE Coke: Orange Mauritius Investment sold 5 lakh shares (1 percent) at Rs 1.8 each

Corporate Action

• Circuit filter revised to 10 percent: Unitech and Adhunik Metaliks.
• Circuit filter revised to 5 percent: 3i Infotech, Jyoti Structures and Waterbase.

Here are some analysts' top stock bets for 2018.https://t.co/sK0YjQFDnY pic.twitter.com/mI56BBzNKA

Insider Trades

• DCW promoter sells 10,000 shares on Dec. 27.
• Divis promoter sells 30,000 shares on Dec. 29.
• JP Associates promoter sells 1.2 lakh shares on Dec. 28 - 29.

Who's Meeting Whom?

• JSL Stainless to meet various Fund houses on Jan. 4 and 5.

Rupee

• Rupee closed at 63.68/$ on Monday from 63.87/$ on Friday, at its highest level since Aug. 8.

Top Gainers And Losers (Last Three Months)

Index Trends

F&O Cues

• Nifty January futures trading at 10,498.7, premium of 64 points versus 27 points.
• January series: Nifty open interest down 3 percent; Bank Nifty open interest up 5 percent.
• India VIX ended at 13.3, up 5.3 percent.
• Max open interest for Jan. series at 11,000 Call (open interest at 41.2 lakh, up 11 percent).
• Max open interest for Jan. series at 10,300 Put (open interest at 47.1 lakh, up 3 percent).

F&O Ban

• In ban: HDIL, JP Associates, Reliance Communication.
• New in ban: Reliance Communication.

Only intraday positions can be taken in stocks which are in F&O ban. In case of a rollover of these intraday positions, there is a penalty.

Put-Call Ratio

• Nifty PCR at 1.56 from 1.61.
• Nifty Bank PCR at 0.90 from 0.95.

Stocks Seeing High Open Interest Change

Fund Flows

India's eight core industries grew 6.8% in November from the year-ago period. https://t.co/L9PJmNdK06 pic.twitter.com/70CalL7n9A

Brokerage Radar

Angel Broking on Capital First

• Initiated ‘Buy' rating with price target of Rs 850.
• Change in ownership and management brought new life to company.
• Strong capital adequacy and pick up in retail credit to ensure loan growth.
• Favorable loan mix with expansion in NIM to drive earnings.
• Expect asset under management and earnings ot grow at a compounded rate of 23 percent and 32 percent respectively over the financial years through March 2020.
• Formalisation of economy to open new opportunities Housing finance is small but has huge potential.
• Reducing dependence on bank borrowings to lower cost of funds.
• Stock poised for re-rating with improving return ratios.

IDFC Securities on India Strategy

• Asset heavy and export-oriented industries to benefit by recovery in global economy.
• Consumption and discretionary consumption to find growth impetus from retail credit.
• Recent reduction in tax rates for discretionary consumer sector to boost overall consumption.
• Nifty's earnings per share target for the next financial year is at Rs 577, i.e., 20.6 percent year-on-year (YoY) growth
• Mild downgrade risk to continue in near term, but earnings to bounce from the next financial year.
• Overweight: Engineering and Capital goods, Construction, Metals & Mining, Oil & Gas, Consumer Goods, Automobiles, Media and Pharmaceuticals.
• Neutral: Banks, Cement, Chemicals, Power and IT.
• Underweight: Real Estate and Telecom.
• Large caps Top Picks: SBI, ONGC, Motherson Sumi, HPCL, Hindalco Industries, Aurobindo Pharma, Bharat Electronics and Ashok Leyland.
• Small and Mid caps Top Picks: Kajaria Ceramics, SpiceJet , Ashoka Buildcon and Greenply Industries.
• Top Sell: Bajaj Auto.

CLSA on Mahindra & Mahindra

• Maintained ‘Buy'; raised price target to Rs 910 from Rs 885.
• Good outlook and priced cheap.
• Positives: healthy demand in tractors and a cyclical recovery in light commercial vehicles.
• Expect volume and warnings per share to grow at a compounded rate of 10 percent and 14 percent respectively over the financial years through March 2020.
• M&M is top Buy in Indian Autos for 2018.
• SUVs weak volumes bottoming out; Upcoming MPV launches key trigger.
• Positive on rural India given rise in government spending and general elections in 2019.

CLSA on India Financial Sector

• Expects rates and bank credit growth to rise; 25-50 basis points hike in rates.
• Expect financialisation of savings and capital raising to continue.
• Expects pick-up in affordable housing; Porject compounded growth rate of 16-17 percent by March 2022.
• 2018 to be litmus test for NCLT; $70 billion (50% of gross NPL) worth NPL cases to be resolved.
• Transition to Ind-AS to cost $25-30 billion mostly to PSU banks.
• Extent of haircut for steel sector and timely recap will be key.
• Wild cards: Election politics, regulations and wage negotiations.
• Non-lending financials to benefit from financialisation of savings and low penetration levels.
• Top picks: ICICI Bank, IndusInd Bank, HDFC and ICICI Pru Life.

Nomura on Coal India

• Maintained ‘Neutral' with price target of Rs 283.
• Despite moderation in offtake growth in past two months, but 9MFY18 is still fairly robust.
• Coal stock situation at power plants improved in December but remains at sub-par levels.
• Growth outlook remains healthy for the rest of the current financial year.
• CIL's output target of 600 MT for the current financial year appears out of reach.

The demand slowdown in real estate sector is behind us, says Info Edge chief. https://t.co/vRWgjPdkQD pic.twitter.com/z2yjp9RgEM

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