News and Impact

News and Impact

 

 

·      Expects market to open on a positive note after the news that the US House passed on debt-ceiling bill in 314-117 vote, easing US default concerns.  Asian markets recovered from the intra-day low and US Future bounced back into positive territory after the news that the US Congress passed debt-limit legislation forged by President Joe Biden and Speaker Kevin McCarthy. In the domestic front, better than expected FY23 domestic GDP data, over 24-month high FIIs net inflow during the month of May, impressive Q4 results (double digit revenue growth) and IMD predicated normal monsoon will be positive for the market sentiment. Yesterday, Index decline over half percent due to profit booking. However, Nifty 500 stocks advance decline ratio was favorable at 1.3:1.  SGX Nifty declined by quarter percent or 50 points. Any decline will be good opportunity to buy in Indian bourse. FIIs were net buyers nearly Rs28000cr or $3.5bn during the month of May, highest since Feb 2021. Domestic Q4 GDP data reported at 6.1% while expectation was 5% on account of strong growth in the manufacturing, Infra and financials sectors. US Bond yield declined yesterday after the US Fed officials indicating to pause on hike in interest rate in the next policy meeting. Intra-day volatility may not be ruled out on ahead of weekly Nifty and Bank Nifty expiry. Auto stocks will be in focus ahead of monthly sales data to be release today. Government cut ATF fuel price will be positive for airlines stocks. Expects positive for hotel and Restaurant stocks after news that the government cut gas cylinder price.

 

·      US Market   – U.S. stocks ended lower on Wednesday as investors waited for a House vote on the debt ceiling deal to avert a potential default. Both Dow Jones and Nasdaq Composite declined half percent each.

 

·      Global market summary –  The US House passed debt-limit legislation forged by President Joe Biden and Speaker Kevin McCarthy that would impose restraints on government spending through the 2024 election and avert a destabilizing US default. Lawmakers from both parties joined to approve the bill 314-117 Wednesday evening, sending the measure to the Senate for

·      consideration as a default deadline draws near. European markets witnesses biggest monthly decline during the month of May. 

 

·      Asian Market – Stocks fluctuated in Asia on Thursday as the House began voting on the US debt ceiling deal and investors weighed the prospect of a pause in rate hikes from the Federal

·      Reserve this month. Japanese and Australian shares rose, those in South Korea edged lower and US equity futures swung between small gains and losses.

 

·      European Market – European stocks closed May with their biggest monthly drop this year as luxury companies slumped after data showed China’s economic recovery faltering and concern of US Debt ceiling negotiation. UK, Germany and France Index declined over 1% each. 

 

·      Oil –  Oil fell for a third day as industry data pointed to rising US crude stockpiles with demand concerns hanging over the market. Brent Crude declined 2% to $72/bbl

 

·      Gold –   Gold rose for a third day as traders pared bets for more tightening from the Federal Reserve ahead of a vote on the US debt-limit deal. Gold gained 1% to $1966/ounce

 

·      Previous Day market Update – After a rally in the last four trading sessions, the benchmark of the equity Index slipped over half percent on account of profit booking amid weakness in the global market. Across the global markets declined as concerns about US debt-ceiling deals and weak manufacturing PMI data announced from the world's second-largest economy China impacted the market.  Investors were booking profit ahead of domestic GDP data to be released in the post-market hours today. Banking and metal stocks were major losers today while FMCG, telecom, Nifty mid-cap and small cap stocks posted smart gains. Buying interest came in the last hour on account of MSCI Index final day for re-balancing. Stocks like Sona BLW, ABB, Kotak Bank, Zomato, Max Healthcare soared between 3-8% from the intra-day.  Nifty 500 stocks advance-decline ratio was 1.3:1. There was bullish sentiment in the market on account of strong FIIs buying interest, impressive quarterly results, a fall in oil price, and strong micro economy data. Sensex dropped 347 points, or 0.6%, to close at 62,622, while it touched low of 62401. Nifty slumped 99 points, or 0.5%, to close at 18,534 while touching intra-day low of 18484.  FIIs were net buyers Rs2090cr while DIIs were net sellers Rs439cr yesterday.

 

·      Nifty Technical Levels -  Nifty formed a Bearish candle on daily scale but with longer lower shadow indicating support levels are held intact. Now it has to hold above 18500 zones, for an up move towards 18666 and 18888 zones while on the downside support exists at 18442 and 18333 zones.

 

·      Bank Nifty Technical Levels – Bank formed a Bearish candle on daily scale with long lower shadow as buying is visible at lower zone but ended in the negative territory near its crucial 44144 marks. Now it has to continue to hold above 44144 zones for an up move towards 44500 then new life high of 44750 zones while on the downside support exists at 43850 then 43600 zones.

 

·      Actionable BUY – Tejas, Tech Mahindra, Borosil, Dixon Tech, IndiGo, Indian Hotel

 

·      Brokers Radar –  Citi Union Bank TGT by Macquarie at 140, Coal India Citi TGT at 240

 

·      Events –Weekly Nifty and Bank Nifty expiry, Coal India OFS for Non-retail at Rs225 (CMP 241). Ab Capital board meeting for fund raising. Escorts price hike on tractors to implement from today.

 

·      Corporate Action  - Aptech Rs6, Shree Cement Rs55

 

·      Global Data – Non-Farm Productivity, Initial Jobless Claims, Manufacturing PMI and Construction Spending. (US), Consumers Credit, Manufacturing PMI and Mortgage Application(UK). Manufacturing PMI (France). Manufacturing PMI (Germany).

 

·      Market Summary – Govt to sell up to 3% in Coal India via OFS, Domestic GDP grows at 6.1% in March quarter; FY23 growth at 7.2%, Dixon Techs To Partner With Xiaomi To Make Mobile Phones, PTC India Signs Two Long-Term Power Purchase Agreement, No Plans to Pare Stake in Vedanta Ltd., Anil Agarwal Says, SBI Cards Plans To Raise Rs 3,000 Crore From Debentures

 

·      GDP Growth ahead of expectation - Economy grew faster than the government’s expectations last year, as demand spurred an expansion in the services sector and cushioned the impact of elevated interest rates. Q4 GDP grew at 6.1 per cent (YoY) vs previous quarter 4.4% - Bloomberg expectation 5%FY23 GDP growth at 7.2% vs 9.1% (YoY) – Expects positive for the market sentiment on account of strong growth in manufacturing, Infra and financials.

 

·      SBI Card - Company plans to raise up to Rs 3,000 crore by issuing debentures to fund business growth.- positive

 

·      Focus on Airlines stocks  - ATF price was reduced by Rs 4,606 per kilolitre, or 4.09 per cent, to Rs 107,750.27 per kilolitre (kl) in the national capital, according to a price notification of state-owned fuel retailer – Positive for IndiGo

 

·      Coal India OFS - The government will sell up to 3% of its stake in Coal India to raise about Rs4,200 crore through a two-day offer-for-sale (OFS) from Thursday. The offer price at Rs225 a share, 7% discount against the previous day’s close at Rs241. Non-retail segment for to today while retail segment for tomorrow. – Buying opportunity

 

·      Laurus Lab – Company to buy 7.24% more stake in Immunoact for Rs80cr. Company’s stake in Immunoact to increase to 33.86%

 

·      MOIL: The company increased prices of manganese ore grades BGF452, CHF473 and GMF569 by 10%, effective from the June 1. - positive

 

·      Tata Motors: The company is looking to buy back external commercial bonds worth $250 million from bond holders.- positive

 

·      HFCL: The company will spend Rs 470 crore to expand current optical fibre capacity to 33.9 million fibre kilometer per annum from 10 million fibre kilometer per annum at its manufacturing facility in Telangana – positive

 

·      Vinati Organics: The company bought additional 65.97 lakh shares of subsidiary Veeral Organics for Rs 6.59 crore.

 

·      Lemon Tree Hotels: The company will acquire 9.67 lakh compulsorily convertible preference shares of Fleur Hotels from APG Strategic Real Estate Pool NV at Rs 505 apiece, resulting in a total outgo of Rs 48.84 crore.

 

·      Steel Authority of India: Amarendu Prakash has taken over as chairman of the company – positive

 

·      Rainbow Children’s Hospital: The company appointed Vikas Maheshwari as the chief financial officer, effective June 1, following resignation of R Gowrisankar from the position. - positive

 

·      Vedanta - Billionaire Anil Agarwal has no plans to reduce his stake in Vedanta, the chairman of parent Vedanta Resources said Wednesday, adding that the company could explore the option only if the need arises in the interest of the country. Vedanta Resources has a very comfortable debt-to-equity ratio – Long term positive

 

·      Dixon Technologies – Company and Xiaomi India plan to partner for manufacturing and exporting mobile phones from India, as a part of its 'Make In India' commitment.- positive

 

·      PTC India - Company has signed two agreements for purchase of 215 MW electricity on a long term basis with Brookfield Renewables for purchase of 100 MW solar power, another pact is with V S Lignite for purchase of 115 MW thermal power.- Positive

 

·      Vedanta Resources pays off all its maturing loans and bonds due in May and June 2023. Vedanta’s gross debt stands at $6.4 billion, as of today, down from $6.8bn at the end of April 2023. Long term positive

 

·      Himadri Speciality – Company invests AU$ 10.32 million or Rs 55.43 crore in Sicona Battery Technologies Sicona is an Australian startup specializing in silicon anode technology for lithium-ion batteries.

 

·      Poonawalla Fincorp will sell 24.98 crore shares in its unit Poonawalla Housing Finance to Perseus SG Pte., a TPG Global LLC entity.  RBI has approved the proposed divestment – positive

 

·      Focus on logistic and food grain stocks - The government will bring a policy for world's biggest food grain storage scheme under the cooperative societies sector. The government will make an allocation of approximately Rs 1 lakh crore. Under this scheme, a godown of a capacity of 2000 tonnes will be constructed in every block – Expects positive for KRBL, Godrej Agrovat, Container Corp, Aegis Logistic,

 

·      Mahindra & Mahindra: The company incorporated subsidiary Mahindra Last Mile Mobility to manage its three-wheeler and small commercial vehicle businesses. The auto major also incorporated a step-down subsidiary, Icarus Hybren, to run the renewable energy production and distribution business. - positive

 

·      Axis Bank: The board appointed former RBI deputy governor NS Vishwanathan as an additional director for a period of four years, up to May 29, 2027. - positive

 

·      Aurobindo Pharma: The company received tentative new drug application approval from the U.S. FDA for HIV drugs Dolutegravir, Entricitabine, and Tenofovir Alafenamide tablets. – positive

 

·      Sun Pharm: The company received approval from China’s National Medical Products Administration for its new drug application of tildrakizumab injection, used to treat moderate-to-severe plaque psoriasis. - positive

 

·      Lupin: The company entered a strategic collaboration with Enzene Biosciences to launch Cetuximab in India, used in treatment of head and neck cancer. - positive

 

·      Welspun Corp - Company guided for a 50% growth in its revenue over FY24 to approximately Rs 15,000 crore, as per the company's investor presentation. Welspun also targets increasing natural gas consumption from 6% to 15% of the energy mix by 2030. It also expects refining capacity to increase from 250 MTPA to 450 MTPA over the next few years. – Positive

 

·      Birlasoft – Company has launched bCloud+, an end‐to‐end solution to help enterprises migrate on‐premises Oracle JD Edwards instances to Oracle Cloud Infrastructure (OCI). – positive 

 

·      Mastek – Company has considered and approved the appointment of Mr. Hiral Chandrana, as a Chief Executive Officer and Key Managerial Personnel of the Company with effect from May 31, 2023. Further, he shall continue to be the Global Chief Executive Officer of the Mastek Group Subsidiaries. – positive.

 

·      Deloitte Flags Adani Port Transactions Citing Lack of Review -  Adani Ports’s auditor said insufficient disclosures over transactions with certain entities means it can only issue a qualified opinion on the company’s accounts, returning the spotlight to allegations made by short seller Hindenburg Research on Gautam Adani’s empire. Deloitte Haskins & Sells LLP raised concerns on Tuesday over transactions with three entities, which the company said were unrelated parties. But the auditor said it could not independently confirm that the parties were indeed unrelated, and that the company has refused to get an independent external xamination that would help prove so.