· Expects market to open on a positive note after the US May Inflation fell to lowest level since March 2021 at 4.1%, US core inflation decline to15-month low, domestic inflation nosedived to 25-month low and China’s central bank surprised with cut in reverse repurchase rate by 10 basis along with to consider stimulus, above these factors will boost the market sentiment. Expectation of US Federal Reserve policymakers are poised to pause their hiking of interest rates for the first time in 15 months after cooling US Inflation print. However, US Fed commentary will be important for the global market sentiment. US Dollar Index fell to 1-month low to below 103 while US 10-Year and 2-year Bond spiked to 2-month high ahead of policy outcome today. US Vix (Volatility Index) decline by 3% to below 15, indicating a positive sentiment in the US market. Overnight, US market gained up to 1% to close 14-month as market well come cooling down US Inflation. Japan market is up 1% to decade high. SGX Nifty is up quarter percent or 45 points. FIIs turned into strong net buyers over Rs1500cr yesterday and hope of good monsoon will be positive for the market sentiment. Expect rally to continue and Index just half percent away from the record high. Technically, Nifty and Bank Nifty formed a Bullish candle on daily scale and bulls established a strong closing. Yesterday, Sensex climbed over 400 points to close 7-month high led by realty, banking, capital goods and metal stock. Expects positive for realty stocks due to strong demand and stable interest rate. Metal momentum may continue after China rate cut and to consider stimulus and US Metal Index gained 4%. IT stocks may be positive on account of attractive valuation and global IT major Index Nasdaq Composite surged to 14-month high.
· US Market – US stocks reached their highest closes in 14 months after data showed that consumer prices rose modestly in May at 24-month low at 4% , boosting bets that the Federal Reserve will not raise interest rates at the end of its two-day policy meeting this week. Dow Jones gained nearly half percent and Nasdaq Composite advance nearly 1%. US May CPI reported at 4% while expectation was 4.1%, previous month was 4.93%. Core services inflation excluding housing, receded to the slowest pace in 15 months at 5.3% while previous month was 5.50%
· Global market summary – US Dollar Index fell to 1-month low to below 103, US 10-Year and 2-year Bond spiked to 2-month high at 3.8% and 4.65% yesterday ahead of policy outcome today. US Vix (Volatility Index) decline 3% to below 15. Japan Market surged to 3 decade high. China’s central bank surprised with cut in reverse repurchase rate by 10 basis points to 1.9. It was the first reduction in the rate since August 2022.
· Asian Market –An index of Asian equities rose for a fourth day amid bets for supportive monetary policy from central banks in China and Japan and a pause in interest rate hikes from the Federal Reserve. Japan’s Topix rallied almost 1% early opening as it extended its three-decade high. Australia and South Korea Index modest gain.
· European Market - European stocks advanced the most in more than a week after data showed that US consumer price inflation slowed in May, bolstering market expectations for the Federal Reserve to pause its aggressive rate-hiking campaign this week. UK, Germany and France Index gained over half percent each.
· Oil – Brent Crude surged 3% to $74/bbl on account of tight supply by Saudi Arabia’s latest oil production cuts and OPEC) on Tuesday further raised its forecast for the growth in China's oil demand in 2023 due to "better-than-expected performance in China's economy,".
· Gold – Gold prices moved lower BY 1% to $1947/ounce on Tuesday, shaking off early gains after data showed a modest monthly increase in U.S. consumer prices and bond yields pushed higher as traders awaited Wednesday's Federal Reserve's policy announcement.
· Previous Day market Update- Sensex climbed over 400 points to close 7-month high and is just half percent lower than the record high led by realty, banking, capital goods and metal stocks. There was rally for the second straight session on improved sentiment after data showed domestic retail inflation cooled off to a 25 month low in May, while investors await US inflation data and Federal Reserve's rate decision. Moreover, fall in oil price and hope of good monsoon also boosted sentiments. Global markets joined hands with domestic market after China’s central bank surprised with cut in reverse repurchase rate by 10 basis points to 1.9. It was the first reduction in the rate since August 2022. Moreover, China government is considering a broad package of stimulus measures to boost the economy, including property support. Both Asian and European market gained half to one percent today. Sensex jumps 418 points 0.7% to settle at 63,143. Nifty climbs 115 points or 0.6% to close at 18,716, just 100 points lower than the record closing of 18812. FIIs were net buyers Rs1678cr while DIIs were net sellers Rs203cr .
· Nifty Technical Levels - Nifty formed a Bullish candle on daily scale and bulls established a strong closing after days of lackluster move. Now it has to hold above 18676 zones to witness an up move towards 18777 and 18888 zones while on the downside support exists at 18636 and 18550 zones.
· Bank Nifty Technical Levels – Bank Nifty formed a Bullish candle on daily scale and negated the formation of lower highs after three trading sessions. Overall buying is visible at lower zones and index is holding above its crucial support of 20 DEMA. Now it has to hold above 44044 zones for an up move towards 44250 then 44500 zones while on the downside support is seen at 43900 then 43750 levels.
· Actionable BUY – IDFC First Bank, Sobha, Tata Steel, NHPC, PVR, Axis Bank, Hindalco
· Brokers Radar – JP Morgan on IT sectors – LTIMindtree TGT at 3850, TECH Mahindra TGT at 950, Tech Mahindra TGT at 2900 and Tata Elxsi TGT at 4600.
· Events – WPI Data, Cabinet meeting at 10.30am
· Corporate Action - Tata Chemical ex-dividend Rs12.30, Diamines Rs3, Jindal Saw Rs3, Canara Bank Rs12, TCS Rs15,
· Global Data – PPI (Producer Price Index), Mortgage Applifcation, FOMC Interest rate decision. (US). Monhly GDP, Manufaturing Production, Construction Output and IIP (UK).
· Market Summary – Anupam Rasayan wins large overseas order, Vi revival plan led by Rs 14,000 crore equity infusion, Sajjan Jindal Seeks as Much as 48% Stake in MG Motor India: ET, Keytrade Bank selects Infosys Finacle suite for core banking transformation, Zee board to review Sebi order on Subhash Chandra and CEO Punit Goenka, Oracle Pushes to Record High as AI-Frenzy Spurs Cloud Demand, Patanjali Foods aims Rs 5K cr profit at EBIDTA level.
· Nazara Tech - Societe General has bought about 4 lakh shares in Nazara Technologies through bulk deals on Tuesday – positive
· Tata Chemicals – Media report that the company cut soda ash price by Rs2300 a ton. Company followed Nirma with downward revision of Soda Ash prices. News – Price cut by Nirma amy short term negative but buying opportunity at lower levels.
· JSW Steel and JSW Energy - A private company owned by Sajjan Jindal is seeking the stake, the Economic Times reported. Jindal is likely to own 45-48% of MG Motor India, with dealers
· and Indian employees owning 5-8% - long term positive.
· Vodafone Idea - Company proposes to infuse a total equity of ₹14,000 crore in the near term as part of its business revival plan, said people with knowledge of ongoing discussions. This will see existing promoters Aditya Birla Group (ABG) and UK's Vodafone Group Plc infuse half the overall amount, they said. – news is positive but poor balance sheet is a concern.
· Anupam Rasayan - Anupam Rasayan has signed a letter of intent (LoI) worth $265 million (Rs2,186 crore) for next 5 years with one of the leading Japanese speciality chemical companies to supply new age patented life science active ingredient. - positive
· LTI Mindtree - LTIMindtree announced that it has joined the Microsoft Intelligent Security Association (MISA).- positive
· ZEE Entertainment - Plutus Wealth Management has about 75 lakh shares in ZEE Entertainment through open market transactions on Tuesday. – expects volatile on the stock
· IndiGo - IndiGo has clarified that the company has not received any information with respect to co-founder's intention to sell stake.- positive
· Balkrishna Industries: The company said it will suspend operations at the Bhuj plant from the late evening of June 13, 2023, due to Cyclone Biparjoy. It will halt operations for three to four days. – Any decline will be buying oppotunity
· Kotak Mahindra Bank: Lender to meet on June 16 to consider raising funds by issuing non-convertible debentures or bonds in one or more tranches on a private placement basis during fiscal 2023–2024.- positive
· NHPC - State-run hydropower company NHPC Ltd. will start trial runs in July for the Subansiri Lower project that runs through the states of Assam and Arunchal Pradesh in the country’s north-east.- Positive
· PVR – Focus on PVR-Inox after the news that there was good response new movie – Adipurush. Media report that the Adipurush tickets sold at Delhi for Rs2000
· Infosys – Infosys Finacle, a wholly-owned subsidiary of Infosys, and Belgium’s Keytrade Bank on Tuesday announced the bank’s decision to select Infosys Finacle as the preferred partner for the modernisation of its core banking system – Positive
· Zee board to review Sebi order on Subhash Chandra and CEO Punit Goenka - A day after market regulator Sebi barred Zee promoters Subhash Chandra and CEO Punit Goenka from holding key positions, Zee Entertainment Chairman R Gopalan said the board was reviewing the order. "The Board is currently in the process of reviewing the detailed order, and appropriate legal advice is being sought in order to take the next steps as required – long term positive
· Auto Wholesale Data In May (YoY) - Total auto sales rise 18% YoY to 18,08,686 units in May. Passenger vehicle sales rose 13.5% to 3.34 lakh units. Passenger car sales declined 2.97% to 1.2 lakh units. SUV sales rose 33.5% to 1.55 lakh units. Two-wheeler sales jump 17.4% to 14.71 lakh units. Motorcycle sales up 20.6% to 9.89 lakh units. Scooter sales grew 12.2% to 4.46 lakh units. Three-wheeler sales grew 70.4% to 48,732 units. – Positive on Maruti, Tata Motor, M&M, TVS Motor
· Cummins India – Company had received various CPCB IV+ compliance certifications from the Automotive Research Association of India (ARAI) to provide its customers with various CPCB IV+ emission norms compliant gensets, effective July 1, 2023 – Long term positive
· Patanjali Food – Company has chalked out an aggressive growth plan to reach Rs 5,000 crore operational profit and over Rs 50,000 crore turnover in the next five years, banking on huge opportunity that it sees in FMCG business and oil palm plantations. – Long term positive
· Granules India – Company announced that the US FDA has approved its Abbreviated New Drug Application (ANDA) for Metoprolol Succinate Extended-Release Tablets. Metoprolol Succinate ER Tablets are indicated for the treatment of hypertension in order to lower blood pressure. The current annual U.S. market for Metoprolol Succinate ER Tablets is approximately $321mn – positive
· Oracle Finance - Oracle Corp. gave investors a boost by saying the company’s cloud-computing business will continue to grow rapidly in the coming fiscal year after a strong performance in the past quarter. Shares, which had jumped to a record high at the close. Cloud sales gained 54% in the fiscal fourth quarter to $4.4 billion, after a 45% jump in the previous period. In the fiscal year ending May 2024, cloud revenue should increase at least as much as in the year that just ended, Chief Executive Officer Safra Catz said on a conference call after the results – stock gained 7% yesterday.
· Sprayking Agro Equipment- Company received New Purchase order worth Rs60cr approx. - positive
· L&T – Company wins significant hydrocarbon order – positive
· L&T's - L&T Energy Hydrocarbon, bagged a "significant" contract from an overseas client for a new offshore project. The company did not provide financial details of the contract, but it classifies "significant" contracts as those between Rs1000cr –Rs2500cr - positive
· Alan Scott – Company’s board approves 1:1 rights issue at Rs30 a share (CMP 60) - Avoid
· HFCL wins Rs80.9cr from Delhi Metro Corp – positive
· Signet Industries Company bagged Rs 120 crore order from various EPC contractors. These order are for pipes in water supply project in state of Madhya Pradesh, Uttar Pradesh, Orissa, Rajasthan, Maharashtra. – positive
· Inox Wind Energy: The company will merge with parent Inox Wind via a share swap. For every 10 shares of Inox Wind Energy, 158 equity shares of Inox Wind will be issued. For every 10 share warrants of Inox Wind Energy with an issue price of Rs 847 each, 158 share warrants of Inox Wind – positive
· Tejas Networks: The company deployed its TJ1400 family of carrier-class fibre-to-the-x and packet switching network solutions to deliver high-speed fibre connectivity services to businesses across the country for Tata Tele Business Services.
· Greaves Cotton: The company’s e-mobility business Greaves Electric Mobility has entered into an agreement with non-banking finance firm Bike Bazaar Finance to finance vehicles – Long term positive
· Zydus Life – Company gets final approval from US FDA for Varenicine tablets – positive
· Focus on Metal stocks After China Central Bank Surprises With Rate Cut to Spur Economy and to consider stimulus - Expects positive for metal stocks after the China’s central bank surprised most economists and market participants by cutting a short-term policy interest rate and are stepping up stimulus to boost the recovery. The People’s Bank of China lowered the seven-day reverse repurchase rate by 10 basis points to 1.9. It was the first reduction in the rate since August 2022. China is considering a broad package of stimulus measures to boost the economy, including property support. Expects positive for metal stocks - . We are positive on Hindalco, Tata Steel, Nalco, Jindal Steel
