What changed market while you were sleeping
With Gujarat and Himachal Pradesh in the BJP’s kitty and US equity indices settling at record high levels in overnight trade, the momentum is likely to stay positive on Dalal Street on Tuesday. Let’s check out what all might influence the market through the day.
Singapore trading sets stage for positive opening
At 6.30 am, Nifty futures on the Singapore Stock Exchange were trading 14 points, or 0.14 per cent, higher at 10,415, indicating a positive start for the Nifty50 in India.
Nifty50 forms ‘High Wave’ candle
Rajesh Palviya of Axis Securities said the buying momentum in the Nifty50 was observed on the 100-day SMA at the 10,100 mark, which still remains a crucial support level.
“On the daily chart, the index has seen a downsloping ‘Channel’ breakout at 10,350 level on a closing basis, which signals bullish sentiment. From its current level, the index is likely to scale the 10,450-10,490 range, while immediate supports are placed at 10,360 and 10,320 levels,” Palviya said.
US stocks closed at record high
Wall Street hit record closing highs on Monday as optimism increased about the likelihood of lower corporate tax rates as the Republican tax bill moved closer to passage, Reuters reported. The Dow Jones Industrial Average index rose 140.46 points, or 0.57 per cent, to 24,792; the S&P500 added 14.36 points, or 0.54 per cent, to 2,690 and the Nasdaq gained 58.18 points, or 0.84 per cent, to 6,994.
Market focus shifts to earnings
With crucial state elections out of its way, investor focus would again shift to macros and earnings recovery. “Going forward, we expect focus of market to shift to fundamentals and earnings recovery. We also note that 2018 has a busy political calendar and, therefore, market volatility could be higher. Our preference would be for cyclical financials, consumption recovery plays, especially rural-oriented ones, select private capex plays and some contrarian bets from pharma sectors,” Motilal Oswal Securities said.
Budget could be farm-centric
BJP’s victory in the Gujarat elections, hard-fought as it was, points clearly to the possible direction of the Union Budget that Finance Minister Arun Jaitley will present in February. Given its setbacks in non-urban areas, the big focus of the ruling party will be on the farm sector and the rural economy, apart from a likely boost in minimum support prices (MSP).
Midcap rally likely to continue
The record premium in midcap share valuations over the blue chips may widen after BJP’s victory in Gujarat elections. Though there are concerns over frothy valuations, midcap stocks may remain firm as domestic investors continue to look for winners in this segment.
Pharma stocks in focus
National drug pricing regulator NPPA on Monday said it had notified prices of 65 essential formulations, including those used for the treatment of diabetes, infections, pain and high blood pressure. In respect of medicines that are not under price control, manufacturers are allowed to increase the maximum retail price by 10% annually.
RCom insolvency plea in Jan
The National Company Law Tribunal (NCLT) adjourned the hearing of insolvency petitions filed against Reliance Communications to early next month after a group of the telecom operator’s lenders sought time to consider converting the company’s loans into equity.
Trai proposes to cut porting fees
India’s telecom regulator Telecom Regulatory Authority of India (Trai) has proposed to slash by nearly 80 per cent the fee charged to consumers for porting from one service provider to another without changing their number. The regulator has sought comments from stakeholders by December 29.
Rs 5,000 cr spent on new Rs 500 notes
As per the information provided by minister of state for finance P Radhakrishnan in a written reply to Parliament, as many as 1,695.7 crore pieces of Rs 500 denomination notes were printed till December 8. The amount spent on production of these notes stood at Rs 4,968.84 crore.
Welspun India patents fibre-tracking technology
Welspun India has emerged as the first global textile entity to patent a fibre-tracking technology. The Mumbai-based world’s second largest terry-towel producer developed the technology after a large customer terminated a contract following mislabelling of the provenance of fibre in certain consignments.