News and Impact

News and Impact 

·       Expects market to open on a flat note on account of global cues. US market declined upto half percent and Asian market open on a mixed bag after US announced lower than expected Service PMI data. US Treasuries drifted after a report the US services sector nearly stagnated in May (Service PMI 54.9 while expectation 55.1). The Institute for Supply Management’s overall gauge of services unexpectedly fell to the lowest level of the year, offering a less upbeat assessment of the US economy. However, risks still loom with market increasingly speculating the Federal Reserve will hold rates steady in June, but keep its options open for hikes later on. US Banking stocks declined after the Treasury debt issuance, proposed new capital requirements. SGX Nifty is trading flat to negative. Expects rangebound market today on ahead of RBI credit policy to be announce on Thursday. Two days MPC (monetary policy committee) meeting will commence from today while expectation of RBI may keep unchanged interest rate. Yesterday, market gained marginally but momentum continued on mid-cap and small cap stocks. Nifty 500 stocks advance decline ratio was favorable yesterday at 1.4:1. Undertone bullish sentiment in the market on account of better than expected domestic GDP and PMI data during the month of May. May Service PMI data announced while it has eased slightly, but registered the second-strongest rate of growth in close to 13 years, on favourable demand conditions and new client wins. Expects rally on defence stocks to continue after the US Defense Secretary said that the country is increasingly interested in sharing defense technology with its south Asian partner. Banking, Auto and Real Estate stocks will be in focus ahead of RBI policy outcome this week.

 

·       US Market   – US Market declined marginally after a report the US services sector nearly stagnated in May. The Institute for Supply Management’s overall gauge of services unexpectedly fell to the lowest level of the year, offering a less upbeat assessment of the US economy. Dow Jones slipped half percent while Nasdaq Composite ended marginally lower.

 

·       Global market summary – Brent crude nearly 2-week high. US Dollar Index surged to above 104.

 

·       Asian Market – Asian equities open on a mixed bag after the US stocks pulled back short of entering a bull market. Shares declined nearly half percent in South Korea, Taiwan and Australia while Japan market posted modest gain. Speculation that the Fed may plan to keep rates steady in June but keep options open for later hikes ramped up after the Institute for Supply Management’s overall gauge of services unexpectedly fell to the lowest level of the year, offering a less upbeat assessment of the US economy

 

·       European Market – European stocks fell on Monday, trimming Friday’s rally, after weaker-than-expected data from the US stoked investor concern about the health of the economy. UK, France and Germany Index declined nearly half percent each.

 

·       Oil –  Oil edged lower by 1% to below $77/bbl as traders weighed the outlook for supply and demand after Saudi Arabia’s surprise pledge for extra supply cuts.

 

·       Gold –   -- Gold advanced 1% to $1962/ounce as Treasury yields fell after weak US service-sector activity made traders rethink the Federal Reserve’s interest-rate hike path.

 

·       Previous Day market Update –.Equity benchmark Index ended in the green for the second consecutive session on positive global cues amid hopes of a pause in rate hikes by the US Fed,  ahead of RBI credit policy to be announce this week. Action shifted to defense, shipbuilding and auto stocks. Heavyweights like Reliance Industries, ICICI Bank, Tata Motor, L&T, Axis Bank and M&M were major gainers among the Nifty stocks. Sentiments were boosted across the global markets on the hope of US Fed to pause hike in interest rate and strong domestic economy data. Today, May Service PMI data announced while it has eased slightly, but registered the second-strongest rate of growth in close to 13  years, on favourable demand conditions and new client wins. Mid-cap and small cap stocks continued rally and Nifty 500 stocks advance decline ratio was 1.4:1. Sensex climbed 240 points or 0.40 per  cent to settle at 62,787. During the day, it jumped 396 points or 0.63 per cent to 62,943. The Nifty advanced 60 points or 0.30 per cent to end at 18,594. . RBI credit policy would be announce on 8th June or Thursday while US Fed rate decision to be release on subsequent week or June 14. Expectation of RBI to keep unchanged interest rate on account of cooling down inflation.  FIIs were net sellers Rs701cr while DIIs were net buyers Rs1196cr yesterday.

 

·       Nifty Technical Levels – Nifty formed a small bodied candle on daily scale and negated its lower highs formation of the last three sessions to close with gains of around 60 points. Now it has to hold support of 18580 zones to witness an up move towards 18750 and 18888 zones while on the downside support exists at 18480 and 18442 zones.

 

·       Bank Nifty Technical Levels – Bank Nifty formed a Doji candle on daily scale as some profit booking was seen from higher zones in the last hour of the session and it closed at it opening zones. However it negated the formation of lower highs after four sessions to close with gains of around 160 points. It is holding well above its 20DEMA on daily scale and buy on dips stance likely to continue. Now it has to continue to hold above 44044 for an up move towards 44250 then 44500 zones while on the downside support exists at 43750 and 43500 zones.

 

·       Actionable BUY – IDFC, Indusind Bank, Tata Power, Global Health, HAL

 

·       Brokers Radar – ONGC TGT by Morgan Sanely at 206, Nomura – BHEL TGT at 61 from 79. PNC Infra TGT at 375. Jefferies on Power Sectors– Power Gird TGT at275, NTPC TGT at 205, Tata Power TGT at 185 from 175, IEX TGT at 120, JSW Energy TGT at 325. Tatat Consumers TGT by JP Morgan at 770, Axis Bank TGT by Jefferies at 1150

 

·       Events – RBI’s MPC meeting commence from today while RBI credit policy to be announce on Thursday.  IKIO IPO will be open today with price brand between 275-285 a share. Bajaj Finserv meeting for new product launch.

 

·       Corporate Action  - ex-dividend - Nelco Rs2.00

 

·       Global Data – Constriction PMI (UK). Factory Order and Construction PMI (Germany). Exports, Imports and Trade Balance (China)

 

·       Market Summary – Defence Stocks in India Rally as US More Open to Tech Sharing , L&T Finance to sell bad loans worth Rs 3,000 cr, Tata Chemicals Revises Holding Structure of US Operations, TCS bags 10-yr contract from UK, SBI Board to Meet on June 9 to Consider Fund Raising for FY24.

 

·       SBI – Company plans to seek board approval on June 9 to raise funds for the year to March 31,  Fund raising may be considered through private placement of INR and/or foreign currency debt – Positive.

 

·       Focus on Defense stocks - US Defense Secretary Lloyd Austin said that the country is increasingly interested in sharing defense technology with its south Asian partner.  Austin and his Indian counterpart Rajnath Singh signed a road map for a cooperation agreement in defense and technology – Expects positive for HAL, Paras Defense, Cochin Shipyard, Mazagoan Dock, BEL.

 

·       Adani Group: The group made prepayment of margin linked share backed financing totalling $2.15. Promoters also prepaid $700 million debt taken for the Ambuja Cement acquisition. Cash balance of listed portfolio up 41.5% YoY to $4.75 billion (Rs 40,351 crore) in FY23.

 

·       Mahindra & Mahindra: Sunrise Initiatives sells entire stake of 81.58% in Mahindra Marine to Ocean Blue Boating. Ocean Blue currently holds the balance 18.42% stake in Mahindra Marine – Positive

 

·       Allcargo Logistics: Transindia Real Estate has agreed to further divest 10% stake each in five subsidiaries of Allcargo and a 100% stake in Allcargo Multimodal to Blackstone. – positive

 

·       NELCO: Company inks pact to acquire 9.09% stake in Piscis Networks with an initial investment of Rs 99.99 lakhs. It plans to increase stake in the company to up to at least 30%. – positive

 

·       Indian Energy Exchange: Company reported 8,251 MU overall volume in May, a gain of 8% year-on-year. The market clearing price declined 30% year-on-year to Rs.4.74 per unit. Power demand is expected to increase in coming months and supply side liquidity may improve due to enhanced coal supply - positive

 

·       Emami: Company buys back a total of 23.68 lakh equity shares on Jun. 5.   - Company announced impressive Q4 results.

 

·       Wipro - Company said its cloud-based dynamic digital signage solution Wipro VisionEDGE will power television network Bowling Center TV across the U.S., a new US based digital TV network to be distributed across 1,000 bowling centers in the US. Cisco is also a technology partner signed by BCTV.

 

·       K Cement: Company agrees to sign, execute share purchase agreement to buy 100% stake in Toshali Cements for Rs 157 crore in cash. The acquisition will help the Company expand its footprint into the Eastern Region. - positive

 

·       CSB Bank: Mr. Satish Gundewar takes charge as chief financial officer of company from Jun.5 . He was former CFO of DCB Bank. – Positive

 

·       Godrej Consumer Products: Company appointed Aasif Malbari as Chief financial officer - positive

 

·       JSW Steel - has achieved a significant breakthrough in environmental sustainability by embarking on waste plastic injection in blast furnace. The company has accomplished a remarkable milestone by successfully injecting a substantial quantity of waste plastic into Blast Furnace 3 at their Vijayanagar Steel Plant – positive

 

·       B.L. Kashyap one of the leading Civil Engineering and Construction Company has secured new order aggregating to ₹ 147 Crores approx. The total order book as on date stands at ₹ 2774 Crores – Positive

 

·       Aptech Ltd fixes July 6, 2023 as record date for bonus issue

 

·       Services PMI Eases to 61.2 in May - Services activity contracted in May as the seasonally adjusted S&P Global India Services PMI Business Activity Index eased to 61.2 in May as against 62.0 in April. The expansion was at the second-fastest pace in close to 13 years. Favorable demand conditions, new client wins and positive market dynamics reportedly supported output, S&P said.

 

·       Tata Chemicals  -  company announced the restructuring of its US operations

 

·       Indoco Remedies – Company's CRO arm AnaCipher updates on USFDA inspection, the USFDA has confirmed that no objectionable conditions were observed during their remote assessment. – positive

 

·       PVR INOX - Company launches new 7-screen multiplex at Global Mall, Mysore Road in Bengaluru – positive

 

·       Bajaj Finserv – Company signed a Memorandum of Understanding (MoU) with the Government of Maharashtra, to develop a Rs. 5000 crore project in Pune, one of the largest financial services investments in the country. – positive

 

·       L&T Finance– Company has initiated a bidding process to sell non-performing loans worth Rs3,022 crore to asset reconstruction companies. These loans are spread across 10 accounts, including Nirmal Lifestyle Developers, Nirmal Lifestyle Malls, and Supertech. – positive

 

·       Sbi Card – Company approves raising Rs3000cr funds via debt, bond, private plcement - Positive

 

·       NSE, BSE To Introduce Enhanced Surveillance Mechanism For "Micro-Small" Companies From Jun 5 - To curb volatility in small-cap counters, leading stock exchanges BSE and NSE have put in place an enhanced surveillance mechanism for companies that have a market cap of less than Rs 500 crore

 

·       TCS – Company has been awarded a 10-year contract by the UK Government's Department for Education to administer the Teachers’ Pension Scheme. The contract includes administration and further enhancement of customer experiences via a digitally enabled system.

 

·       Mahindra Life - Company announced, Mahindra Industrial Park Chennai a JV between Mahindra World City Developers and Japan-based OMRON Healthcare will start operations at Origins by March 2025. The OMRON Healthcare factory will be built over 6.02 acres and will be manufacturing blood pressure monitors and supplying them mainly to the domestic market.- Positive

 

·       Tata Power - Company will set up renewable energy plant in Bikaner, Rajasthan, to supply 211 million units to Kerala The project is expected to be completed in seven months – positive

 

·       Suzlon – Company becomes first Indian wind energy company to cross 20 GW of wind energy installations through 12,467 wind turbines installed across 17 countries. – Avoid due to poor balance sheet

 

·       Embassy Office Parks REIT – Company to Raise Rs 1,050 Crore Via Private Placement Of NCDs Company will allot 1,05,000 non-convertible debentures at a face value of Rs 1,00,000 each for the coupon rate of 7.77% per annum – positive.

 

·       Greaves Cotton - Company's NBFC Arm Introduces online platform for EV financing Greaves finance launches electric vehicle financing platform 'evfin". - positive

 

·       Patel Engineering receives a contract for the construction of a 6.70 km treated water tunnel from CIDCO worth Rs520

 

·       Som Distilleries – Company announces 42% growth in its beer market share in Madhya Pradesh for the month of May.- positive

 

·       HG Infra – Company gets Rs655cr railway EPC orders – positive

 

·       Nava LTD – Company says its Zambia based colliery has lowered overall liabilities by about $277m.  The unit Maamba Collieries Ltd. has leveraged upon the improved operational cash flows to discharge overdue loan instalment aside from meeting regular debt service from March.  The unit has reduced its overall liabilities by $277m since start of December to $206m, which is a significant turnaround in its financial position – stock gained 7% yesterday