· Hope of US Fed to pause hike in interest rate and negotiation of US debt ceiling deal lifted across the global market between 1-2%. The S&P 500 index and Nasdaq Composite (up 1% each) closed at their highest levels in more than nine months on Thursday, boosted sentiment with Congress making progress on raising the debt ceiling, support coming from U.S. economic data and some Federal Reserve officials who suggested there may be no need to raise interest rates again in June. As a results, US Vix nosedive (Volatility Index) 15% to close over 12-month low and fall in Dollar Index. Back home, SGX Nifty is up half percent or 74 points on account of strong domestic factors. Manufacturing PMI during the month of May reported 31-month high which indicated strong growth in the manufacturing and factory growth. Moreover, May GST collection remain strong of above Rs1.5lakh cr in a 5-month row and impressive auto monthly sales volume will be positive for the market sentiment. Strong FY23 GDP growth, impressive Q4 results, fall in oil price and IMD predicated normal monsoon will add fuel in the market sentiment. Yesterday, market fell by half percent but Nifty 500 stocks advance decline ratio was favourable at 1.6:1. Expects momentum continue on mid- cap and small cap stocks. Tech stocks may be positive after Global IT major Index Nasdaq Composite closed 9-month high. Metal stocks will be in focus as base metal price on LME surged to 2-week high. Auto stocks will be positive after announced strong monthly sales data. US Voting on debt ceiling and US Job data likely to be held today.
· US Market – US stock indexes closed higher as signs of slowing wage pressure on inflation raised hopes the Federal Reserve will pause raising interest rates in two weeks, and investors welcomed a vote in Congress to suspend the debt ceiling. Both Nasdaq and S&P 500 gained 1% to close at 9-month high while Dow Jones gained half percent.
· Global market summary – US Vix (Volatility Index) declined 15% to close over 12-month low. S&P 500 and Nasdaq Composite closed 9-month high. Brent crude fell to 1-month low, US Voting on debt-ceiling ling. Base metal price on LME 2-week high.
· Asian Market – Asia stocks advanced after a renewed rally in tech giants pushed Wall Street higher ahead of jobs data due Friday as investors assess the likelihood the Federal Reserve will pause interest rate hikes in June. Hong Kong (up 2%), South Korea, Taiwan and Japan Index advance half to one percent.
· European Market - : European stocks rose as investors received a positive euro zone inflation data along with reports of the US House of Representatives passing a bill to avoid a catastrophic debt default. UK and France Index gained over half percent each. Germany Index gained 1%. European Union May Inflation fell to 6.1% vs expectation 6.3% (previous month was 7%).
· Oil – Brent Crude is trading flat at $74/bbl but biggest weekly loss in a month as persistent concerns over demand weigh on the market ahead of an OPEC+ meeting.
· Gold – Gold gained 1% to $1978/ounce after traders pared bets on further tightening this month following a flurry of data that showed some progress on getting inflation under control.
· Previous Day market Update – Equity benchmark indices closed in the red for the second straight day after investors booked profits on gains following stronger-than-expected domestic growth data, and receding bets of a US rate hike. However, Nifty mid-cap and small cap stocks continued its northbound journey and ended on a record high. Nifty 500 stocks advance decline ratio was favorable at 1.6:1 due to trader shifted from large cap to small and mid-cap counters.. Upbeat in domestic sentiments after FY23 GDP growth reported at 7.2% (expectation 7%), over 24-month high FIIs net inflow during the month of May, impressive Q4 results (double digit revenue growth) and IMD predicated normal monsoon. Moreover, Manufacturing PMI during the month of May reported 31-month high and reported impressive auto monthly sales. Traders were booking profit in the last two trading sessions after the bank Nifty surged to record high and Nifty just 1.5% away from the all time high. Sensex ended 194 points lower 0.3% to settle at 62428, dragged by banking and financial stocks. The broader Nifty dropped 46 points or 0.25% to end at 18,488. FIIs were net sellers Rs71cr while DIIs were net buyers Rs489cr yesterday.
· Nifty Technical Levels – Nifty formed a Bearish Belt Hold candle on daily scale and has been forming lower lows from the last three sessions. Now it has to find support near 18442 zones, then only we can witness a bounce towards 18580 and 18666 zones while a hold below 18442 could open the further decline towards 18333 and 18181 zones.
· Bank Nifty Technical Levels – Bank Nifty formed a Bearish Belt Hold Candle on daily scale as selling pressure was seen at higher zones and index ended with losses of around 340 points. Now till it holds below 44044 zones some weakness could be seen towards 43500 then 43333 levels while on the upside hurdle is seen at 44144 then 44250 zones.
· Actionable BUY – Sun Pharma, Tata Motor, HAL, Eicher, Parras Defense
· Brokers Radar – CLSA TGT on ICICI Prudential at 575, Adani Ports TGT by Philips Securities at 930, ICICI Prudential TGT by CLSA at 57 and Morgan Stanley TGT at 600. Bajaj Auto TGT by Macquarie at 4541. DR Reddy ADR TGT raised by Barclays to $70 FROM $66
· Events – Birla Corp board meeting for fund raising, Coal India OFS for Retail at Rs225
· Corporate Action - Mahindra Rs2.50, Infosys Rs17.50, Indusind Bank Rs14, Steelcast Rs3.15, SYLPH TECHNOLOGIES stock split from Rs10 Re1
· Global Data – Change in Non-farm payroll, Private payroll, Unemployment (US), Industrial Production (IIP) and Manufacturing Production (France).
· Market Summary – Govt. to Ask Airlines to Keep Fares in Check After Go Air Crisis, GST Collections Grow 12% To Rs 1.57 Lakh Crore In May, NHPC inks initial pact with Nepalese utility to develop 480 MW , Maruti, Escorts, M&M, Eicher, Ashok Leyland, Tata Motor, Eicher, TVS Motor and Bajaj Auto announced imprrssive Monthly sales volumes, May Manufacturing PMI rises to highest since Oct. 2020, 31 months high, S&P Affirms Reliance Industries 'BBB+' Ratings; Otlk Stable, US Set to Allow GE to Make India Military Jet Engines: Reuters, TVS hikes electric scooter prices by Rs 17,000-20,000
· NHPC - State-owned hydro power giant NHPC inked an initial pact with Nepalese utility Vidhyut Utpadan Company for developing a 480 MW Phukot Karnali hydroelectric project. – Positive
· Aster DM Healthcare – Company has entered into Hospital Operation and Management Agreement with Padmavathy Medical Foundation (PMF) on May 31, 2023. PMF is a 130-bed tertiary super specialty hospital situated in Sasthamkotta, Kollam District, Kerala. With this total installed capacity of the Company shall be increased to 4,547 beds.- positive
· Autoline Industries - Company has received offer from Tata Motors Ltd. to setup a facility at Sanand, Gujarat to cater with the automobile parts to Tata Motors – positive
· Paras Defence – Company have entered into a Joint Venture Agreement with CONTROP Precision Technologies Limited ("CONTROP"), Israel, with the purpose of undertaking business of manufacturing / production, implementation / installation, Integrated Logistics Support ("ILS"), after sale support, training etc.,
· Coal India: Centre’s offer for sale (OFS) of shares in Coal India received a robust response from non-retail or institutional investors and the issue was subscribed 3.46 times on Thursday
· TVS Motor – Company increased the price of its TVS IQube electric scooter by Rs 17,000 to Rs 20,000 depending on the variant – positive
· The goods and services tax (GST) collections for the month of May stood at Rs 1.57 lakh crore, a growth of 12 percent over the year-ago period. The monthly GST revenue is at more than Rs 1.4 lakh crore for 14 months in a row, with Rs 1.5 lakh crore crossed for the fifth time since inception of GST. Last month, GST collection was at a record high of Rs 1.87 lakh crore.- Positive for the market sentiment – to reduce fiscal burden and indicating all round growth in economy after announced solid GST collection.
· Airlines stocks – The government is working with airlines to bring fares under control after Go Airlines India’s collapse led to a surge in ticket prices, Aviation Minister Jyotiraditya Scindia said at the Times Network India Economic Conclave 2023. – Any decline on Indigo will be buying opportunity.
· US Set to Allow GE to Make India Military Jet Engines: Reuters –The Biden administration is ready to approve a deal that would allow General Electric Co. to make jet engines for Indian military aircraft, Reuters reports, citing three people familiar with the matter. The deal is expected to be signed and announced by the time President Biden hosts India’s Prime Minister Narendra Modi for an official state visit on June 22, the people told Reuters
· Reliance Industries – Rating agency affirming our 'BBB+' long-term issuer credit rating on Reliance Industries. S&P says Reliance Industries operating performance is likely to remain resilient over the next two years – Positive
· L&T: The power transmission and distribution business of Larsen & Toubro (L&T) has said it will set up infrastructure for the world’s largest green hydrogen plant being built by NEOM Green Hydrogen Company – positive
· Aditya Birla Capital: Aditya Birla Capital on Thursday said it plans to raise ₹1,250 crore through a preferential issue of shares to its promoter and promoter group companies – positive
· Power Finance Corporation: State-owned non-bank lender Power Finance Corporation (PFC) on Thursday said its Director (Finance) Parminder Chopra has been assigned the additional charge of the company's CMD - positive
· TVS Motor - Company, said, "TVS Motor is spearheading the EV transformation narrative in the country. Backed by this electrification journey, TVS iQube recorded a sales milestone of 1 lakh units for its range of scooters in the last financial year, which is a testament of its strong community of happy customers. In May 2023, TVS iQube crossed 20,000 units of retails and continues to have a healthy booking pipeline of over 30,000 units." – positive
· GOCL Corp –Company secured orders worth Rs257cr from Coal India for the supply of detonators,
· NCC Company said it had received new orders worth Rs 2,088 crore in the month of May. 2023. Of the aforementioned amount, company's building division has signed the agreements for the orders amounting Rs. 1,668 crore and water division secured order for Rs. 420 crore – Positive
· May Auto sales Update – Maruti, Escorts, M&M, Eicher, Ashok Leyland, Tata Motor, Eicher, TVS Motor and Bajaj Auto announced better than expected monthly sales data - Maruti Total sales at 178083 uint (up 10% YoY) – expectation 164746 unit, M&M total sales at 95541 unit (up 14% YoY) – expectation 95471. Escorts May sales at 9167 unit (up 9% YoY) – expectation 7891. Bajaj Auto May sales at 355148 unit (up 29% YoY) – expectation 326724. Tata Motor reported 73448 vehicles (down 2% YoY) – Expectation 71058, Ashok Leyland reported 13134 vehicles (down 1% YoY) – Expectation 12926. TVS Motor reported 330609 units (up 9.1% YoY) – Expectation 325724 unit.
· NMDC – Company reported iron ore sales during the month of May at 3.62mt (up 37% YoY) and production increased to 3.71mn tons (up 16% YoY) – positive
· May Manufacturing PMI rises to highest since Oct. 2020 – Manufacturing PMI during the month of May reported at 58.7 vs 57.2 previous month
· 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
· South India Bank - Board approved a panel of candidates for the position of managing director and chief executive officer. As per the norms set by the Reserve Bank of India, the bank will now submit its application to the RBI with the names of the candidates in order of preference seeking approval for the appointment of the positions. – positive… stock gain 10% yesterday
· Mphasis Ltd – Company launched a business unit that aims to help clients integrate AI capabilities into their existing technology platforms. The unit Mphasis.ai will offer clients advisory to identify key AI interventions for tasks such as contact center transformation, customer experience transformation. - positive
· Adani Enterprises: Adani Road Transport, a wholly-owned subsidiary of Adani Enterprises, has decided to terminate the agreement to acquire Macquarie Asia Infrastructure Fund's (MAIF) toll road in Andhra Pradesh, Gujarat for ₹3,110 crore
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