Comments on the Market by Mr. Kiran Kumar Kavikondala, Director & CEO, WealthRays Securities

Nifty at record high, banking leads, global cues positive

“Indian equity markets traded with positive bias today, Nifty scaled new highs and was led by banking stocks. RBI lifting FII restriction of share purchase of Yes bank, Kotak Mahindra acquisition of ING Vysya, SBI stock split and strength in Rupee together lifted Bank Nifty. Anticipation of GST bill implementation also led to positive sentiment. Globally, Asian provided positive sentiment after China’s central bank’s announcement of $8.17 infusion in its economy, Japan’s snap elections and service tax hike delay, US jobless claims falling and inflation remaining stable. Nifty closed at record high of 8477.35” , Mr. Kiran Kumar Kavikondala said.

Indian Markets

Indian equity markets traded with positive bias today. Benchmark indices Nifty and Sensex touched record highs led by banking stocks. Major positives such as Kotak Mahindra bank acquisition of ING Vysya bank, govt. capital announcement of Rs.112 billion shortly and RBI lifting restriction on share purchase of Yes bank by FII. Also, winter session which will begin and important bills like pension and GST will be tabled. Expectations of passage of GST boosted benchmark indices leading gains in FMCG stocks. On global front, China’s infusion of $8.17 billion in economy and Japan’s snap election expected next month boosted Asian indices making sentiment positive. US data released yesterday showed jobless claims falling post which benchmark indices recovered losses and closed in positive.

Other Asian Markets

Asian benchmark indices closed higher in presence of major triggers. Wall Street recovered losses post release of jobless claims data providing positive sentiment to Asian markets. China’s central bank announced to infuse currency in economy which lifted SSE (+1.39%). Also, Japan’s parliament lower house was dissolved and called for a snap election which lifted Nikkei.

Commodity Outlook:

Commodity Market was very volatile in the morning session. Gold and Silver Prices showed strength but the upper side was limited by strong Equity Markets which kept focus on Equities. Crude Oil made gains due to expectations of supply cut by OPEC while Natural Gas Prices dipped after opening strong due to profit taking. Base Metals traded weak in the morning session while Nickel Prices continued to make gains due to Indonesia export ban.

Evening outlook:

Gold and Silver are expected to remain range bound in the Evening session; Crude Oil and Natural Gas are expected to make gains while Base Metals are expected to trade weak in the Evening session.

Stock Recommendations:

Aurobindo Pharma- Sell at Rs.1112.00(CMP); Target - Rs.1100.00; Stop Loss – Rs.1125.00

Tata Global - Buy at Rs.156.75(CMP); Target - Rs.158.50; Stop Loss – Rs.155.00

ONGC – Buy at Rs.383.30(CMP); Target - Rs.388.00; Stop Loss – Rs.380.00

Sectors Snapshot

Bank Nifty: Bank Nifty gained today breaching 18,000 levels on major news flows such as Kotak Mahindra acquisition of ING Vysya, SBI stock split, Govt. infusion of Rs.112 billion in PSBs, hopes of GST bill passage in winter session of parliament and globally China’s central bank capital infusion of $8.17 billion in its economy. Rupee also strengthened supporting banks.

CNX IT: CNX IT saw some profit booking with major IT cos taking a breather after recent rally. Rupee recovered from yesterday’s losses was one on the factors for profit booking in IT cos. Tech Mahindra opened higher post its LCC acquisition deal. The stock opened but lost momentum as the acquisition was already factored in the stock price.

CNX Energy: Energy Stocks traded with positive bias in the session today. Investors continue to cautious ahead of OPEC meeting in the coming week where a decision on the supply of Crude would be taken. Reliance was the biggest gainer in the Energy sector today.

CNX Pharma: Pharma stocks weakened and saw profit booking as Rupee strengthened and cyclicals performed. Inflows were seen in banking and capital goods stocks while CNX Pharma took a breather.

Market Movers

Gainers

Kotak Mahindra Bank: Shares of the company hit life time high of 1264.7 on news the bank's board has approved its acquisition of ING Vysya bank.

SBI: The board clarified that the bank has only signed a memorandum of understanding for $1 billion loan to Adani group's Australia arm and the bank's board is yet to clear the loan.

Losers

JSPL: JSPL was down after Chinese flash HSBC manufacturing purchasing managers' index fell to a six-month low of 50.0 from a reading of 50.4 in October.

Infosys: Shares were down on news of financial irregularities at its business process outsourcing arm. The BPO is said to have overcharged client Apple through inflated invoices.

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