News and Impact
· There was smart recovery in the US market from intra-day low, may open domestic market on a flat note. However, concern about rising global inflation, US Fed hawkish commentary and significant hiked interest rate by the euro zone area may be dampening the market sentiment. Overnight, US market gained by 1% led by heavyweight Amazon and Microsoft after the US Fed concluded its two days testimony in the US congress. Bond yields climbed after major central banks warned about the potential for more interest-rate hikes, with officials signaling they’re nowhere near ready to declare victory over inflation. Yesterday, both Bank of England and Norges Bank (Norway) raised the key interest rate by 50bps, above the market expectation (25bps expectation) while The Swiss National Bank (SNB) hiked the interest rate by 25bps. Asian markets fell up to 1% while SGX Nifty slipped quarter percent. Back home, domestic market is better place than the global peers due to May inflation fell to 25-month low and WPI inflation declined to 8-year low. Moreover, stable oil price, FIIs participation and huge capex by domestic players will be positive for the market sentiment. Any dips will be good opportunity to buy in the domestic bourses due to bullish sentiment in the market. Yesterday, both Sensex and the Nifty ended lower mirroring their global peers. Traders were booking profit after the Nifty was just an inch (1 point) away from the record high. Today focus on defense stocks after the US and India signed defense deal. IT stocks will be in focus after global peer Accenture cuts the top end of its full-year revenue growth guidance in its quarterly results announcement.
· US Market – US equities snapped a three-day losing streak as investors analyzed a second day of congressional testimony from Federal Reserve Chair Jerome Powell. Dow Jones ended marginally decline while Nasdaq Composite gained 1% led by tech heavyweight Amazon.com Inc. and Microsoft Corp. adding the most to the gains. However, US market recovered 1% from the intra-day low.
· Global market summary – Bank of England hiked interest rate by 50bps to 5%, highest level since 15 years while expectation was 25bps hike to 4.74%. The Swiss National Bank (SNB) hiked the interest rate by 25bps to 1.75%. Norges Bank (Norway) raised the key interest rate by 50bps to 3.75% from 3.25%. US 10 Years and 2-year bond surged to 1-month high. Gold price fell to 3-month low.
· Asian Market – Asian stocks turned modestly lower today amid elevated bond yields following a spate of central bank rate hikes. Japanese shares erased initial gains as investors weighed inflation data that was stronger than expectation. Japan, South Korea and Australia Index marginally decline HALF . China market is shut today.
· European Market – European equities extended declines to a fourth day on hawkish signals from policy makers as the Bank of England surprised the market with a bigger-than-expected rate
· increase, fueling further fears of an economic slowdown. Yesterday, Bank of England hiked interest rate by 50bps to 5% while expectation of 25bps hike interest rate. UK, Germany and France Index eclined half percent each.
· Oil – Brent Crude declined 3% to $74/bbl after the Federal Reserve signaled that further rate hikes were needed, bruising appetite for risk, aiding the dollar, raising the prospect of an economic slowdown and increase US oil inventory.
· Gold – Gold slipped 2% to 3-month low at $1915/ounce after the Federal Reserve Chair Jerome Powell reiterated the central bank will continue raising interest rates and expectations of Colling down global demand.
· Previous Day market Update –Snapping their two-days winning run, equity benchmark indices the Sensex and the Nifty ended lower mirroring their global peers. The risk appetite of investors remained low on concerns over rate hikes a day after Federal Reserve chairman Jerome Powell said the US Fed would bring more hikes this year. Traders were booking profit after the Nifty was just an inch (1 point) away from the record high. Both Asia and European equity markets decline 1% each. Today, the Swiss National Bank (SNB) hiked the interest rate by 25bps to 1.75% while UK and Norway announced interest rate decisions today. Nifty mid-cap and small-cap stocks were major losers today and declined 1% each. Nifty 500 stocks advance-decline ratio was 1:3. Nifty slipped 85 points or 0.4% to close below the 18800 level at 18771 while touching intra-day high of 18886 just a single point away from the record high. Sensex opened at a fresh all-time high level of 63,602 against the previous close of 63,523 but failed to hold altitude and closed 284 points, or 0.45 percent, lower at 63,239. Auto, IT, and banking stocks were major losers today while sugar stocks witnessed fresh buying. Yesterday, FIIs were net sellers Rs693cr while DIIs were net buyers Rs219cr.
· Nifty Technical Levels – The index is struggling at record high levels and whipsaws can be seen in the market. It formed a Bearish candle or an outside Bar on daily frame and closed with losses of around 85 points. Now it has to hold above 18777 zones to witness an up move towards 18888 then 19000 zones while on the downside support exists at 18710 and 18666 zones.
· Bank Nifty Technical Levels – Bank Nifty formed a Bearish candle on daily scale as selling pressure is seen at higher zones but multiple support is still intact at lower zones. Now it has to cross and hold above 43750 zones for a bounce towards 44044 then 44250 zones while a hold below the same could see some weakness towards 43500 then 43333 marks.
· Actionable BUY – L&T, Fortis, HAL, PNB Housing
· Brokers Radar – Jefferies on IT stocks - Tech Mahindra TGT at 930, HCL Tech TGT at 1210, Coforge TGT at 4150 from 3760, LTIMindtree TGT at 4100 and Infosys TGT at 1550, JP Morgan TGT on UltraTech at 7020. JP Morgan TGT on Bajaj Auto at 5400.
· Events – Tata Consumers to delist its ADR from London stock exchange, Shilpa Medicare board meeting for fund raising.
· Corporate Action - VLS Finance Rs1.50, Tata Elxsi Rs60, Tata Steel Rs3.50, Dalima Bharat Rs5, Dhampur Bio Rs3.50, Torrent Rs8
· Global Data – Manufacturing PMI, Service PMI and Composite PMI. (US). Consumers and Retail sales in Auto (UK). Manufacturing PMI, Service PMI and Composite PMI (Germany). Manufacturing PMI, Service PMI and Composite PMI (France).
· Market Summary – GE Signs MoU to Make Engines for India’s Light Combat Aircraft, L&T Signs Pact With India DRDO for Submarines Propulsion System, Fitch raises India's GDP forecast to 6.3% for current fiscal year, Bharti Airtel to Acquire 12% Stake in Indian Solar Power Company, LTTs extends partnership with PCT, Fortis to sell Chennai Hospital, Fortis Healthcare to divest its Vadapalani, Chennai Hospital Business Operations, Luxury Homes Drive Mumbai Sales As Inventory Falls 24%, Says Anarock
· Watch on Software Company - Technology stocks may move after global peer Accenture cuts the top end of its full-year revenue growth guidance. Accenture sees full-year revenue growth between 8% to 9%, compared with a prior view of 8% to 10% - Accenture declined 2% yesterday.
· L&T Signs Pact With India DRDO for Submarines Propulsion System – Company signed a contract with India’s Defence Research and Development Organisation for two submarines propulsion system modules. The Air Independent Propulsion system modules are for Kalvari class submarines of the Indian Navy – positive
· HDFC: The company divested 9.65% of its stake in Ruralshores via the buyback route. It also sold its entire stake in HDFC Property Ventures and HDFC Venture Capital to Vividh Distributors for a consideration of Rs 1.2 crore and Rs 30 lakh, respectively. - positive
· Bharat Petroleum Corporation: The company will consider fund-raising various modalities on June 28 for a capital infusion, including rights issues. - positive
· PNB Housing and Finance: T. Adhikari has been appointed as Chief Operating Officer of the company.- positive
· Vedanta: The company refuted media reports stating the sale of the Sterlite Copper Plant in Thoothukudi. It said that the reports are "wrong, baseless, and incorrect." - positive
· Coforge: The company acquired the final tranche of shares of the remaining 20% stake in Coforge Business Process Solutions for Rs 336.94 crore, taking its total stake to 80%.- positive
· HBL Power Systems: The board is going to consider approving a proposal for the slump sale of two product lines, Power Electronics and Integrated Power Supplies, to Moebius Power Electronics on June 28. – positive
· Wipro – Company announced the inauguration of its new office at Sable Park, Century City, in Cape Town, underscoring its commitment to clients in the region – long term positive
· Sula Vineyard - IndiGo has announced an exciting collaboration with Sula Vineyards and Fratelli Vineyards to offer exclusively curated holiday experiences for all its Nashik and Pune-bound customers, respectively - positive
· Gujarat Alkalies – Company had earlier announced about updates on 10,000 TPA (80%) Hydrazine Hydrate Project, with forward integration to Hydrogen Peroxide, for the manufacturing of an import substitute at Dahej Complex. The Company has achieved commercial production of Hydrazine Hydrate at Dahej Complex. – positive
· Cyient DLM Sets Price Band For Rs 700-Crore IPO That Opens On June 27 - Cyient DLM Ltd., a unit of IT services firm Cyient Ltd., has set the price band for its Rs 700 crore initial public offering, in the June 27–30 with IPO at a valuation of Rs 2,100 crore. Cyient holds a 92.84% stake in its subsidiary. Cyient current market cap Rs16500cr - Positive,
· Hindustan Aeronautics – GE Aerospace signed a memorandum of understanding with Hindustan Aeronautics Ltd. to produce fighter jet engines that would power the Indian Air Force’s Tejas Light Combat Aircraft Mk2. The agreement includes the potential joint production of GE Aerospace’s F414 engines in India - positive
· Fortis Healthcare – Company announced signing of definitive agreements for sale of its hospital business operations at Vadapalani, Chennai to Sri Kauvery Medical Care for a sale consideration of Rs152 Crore.
· L&T – Company expanded its hi-tech manufacturing capability, inaugurating a new state-of-the-art, advanced Heavy Wall Pressure Vessel facility in Saudi Arabia – Positive
· Natural Capsules – Company has announced a significant milestone in its growth journey with the strategic investment from Somerset Indus Capital Partners, a prominent healthcare-focused private equity fund. Somerset Indus Capital Partners, known for its expertise in the healthcare sector, has invested approximately Rs. 75 crores at a pre-money valuation of Rs. 250 crores in Natural Capsules Ltd – Positive
· Madhav Infra Projects – Company receives LOA for construction of Railway Over Bridge worth Rs37.07cr – positive
· Hazoor Multi Projects – Company received work commencement approval-work order for Eight Lane access controlled Expressway (Shirsad to Akoli section - Spur of Vadodara Mumbai Expressway Project)in the state of Maharashtra on EPC mode worth Rs.352.80 crores – positive
· Ambuja Cements and ACC,- Both companies honored to be recognised among 'India's Top 50 Most Sustainable Companies' cross-industry by BW Businessworld – Long term positive
· Fitch raises India's GDP forecast– Global rating agency Fitch Ratings revised upwards its FY24 economic growth forecast for India to 6.3 per cent from 6 per cent it had predicted earlier. This is primarily because of a stronger outturn in the first quarter and near-term momentum. – positive for the market sentiment
· Zee Entertainment - Economic Times reported CEO Punit Goenka as saying the company’s merger with a Sony subsidiary will go through regardless of whether he is the CEO of the amalgamated firm.
· Goenka told the newspaper that his frequent interactions with Sony don’t seem to indicate that the deal is wavering – expects volatile on the stock
· Bharti Airtel to Acquire 12% Stake in Indian Solar Power Company - Bharti Airtel has agreed to acquire a 12.1% stake in Egan Solar Power for Rs1.34cr. Egan Solar Power is a special-purpose vehicle formed to operate a captive solar power plant.- positive
· Rail Vikas Nigam emerges as the lowest bidder for two projects worth Rs 281 crore. The project is commissioned by the MP Poorv Kshetra Vidyut Vitaran Co. in Jabalpur. – positive
· Focus on Housing stocks - Luxury housing sales continued to top charts post-pandemic, particularly in the Mumbai Metropolitan Region, where prices in the segment had dropped during the first wave. There had been a 24% yearly decline in MMR's unsold stock of homes priced above Rs 2.5 crore, according to data from Anarock Property Consultants Pvt.- Expects positive for Lodha, Oberoi Hotel, Godrej Properties
· LTTs extends partnership with PCT – Company has announced an extension of its partnership with PCT to engineer solutions for aerospace, defense and transportation sectors. Company to provide mutual clients with digital support for design and manufacturing. – positive
· Venus Remedies – Company gets marketing authorisation in Spain for Meropenem, a last-recourse antibiotic. - positive
· Kalpataru Projects: The board approved raising Rs 300 crore via the issuance of unsecured, rated, listed, redeemable, and non-convertible debentures. – positive
· Adani group stocks focus - US authorities are looking into what representations Adani Group made to its American investors following a scathing short seller’s report that accused the company of using offshore companies to secretly manipulate its share prices. The US Attorney’s Office in Brooklyn, New York, has sent inquiries in recent months to institutional investors with large holdings in the India conglomerate – Bloomberg report
· RateGain Travel Technologies – Company announced the launch of its third update for its solution AI Audiences, an AI-powered model built using Adara's ecosystem of travel data. The dataset consists of search and booking data from over 270+ partners across flights, hotels, car rentals, live events and credit card expenditures. - positive
· Fortis Healthcare – Company will be selling it's Vadapalani hospital in Chennai to Sri Kauvery Medical Care for Rs 152 crore – positive
· Canara Bank – Company’s board to meet on June 28 to mull FY24 fund raising plan
