Flat start for Sensex, Nifty

India Infoline News Service | Mumbai | January 06, 2017 08:39 IST

Asian indices ex Japan were all trading in the green as emerging markets are starting the New Year in fine fettle as proxy to weakness to US$ with the Trump rally seeing profit booking.

The outlook is a flat start. The rupee has regained some weight. Asian indices ex Japan were all trading in the green as emerging markets are starting the New Year in fine fettle as proxy to weakness to US$ with the Trump rally seeing profit booking. The US$ weakened sharply to near November 8th levels & in tandem we saw bond yields also fall to 2.36% levels last seen around the US election results.

Reports suggest that a law on taxing indirect transfer of shares is likely to be amended. This could trigger a comeback for foreign investors who have stayed away for a while. Earnings growth and pre-budget agenda will keep the markets busy next week. US crude inventories fell much more than anticipated keeping prices elevated. Nasdaq notched gains to close at a record high while Dow and S&P slid for the day.

The sporadic buying on Thursday has brought the main indices near the pre-demonetisation level. The gross domestic product (GDP) estimates expected later in the day unfortunately will not account for the demonetization impact as it captures data till October only. The advancement of the Union Budget to Feb 1 necessitated that available numbers be taken into account.  Investors will have to wait for the Economic Survey on January 31 which may factor in some of the impact. 

Precious pack benefitted from the temporary pause in the much crowded long dollar trade. Sharp correction in the greenback has provided some breathing space to the yellow metal, with values now reclaiming the psychological level of US$1,180/oz. On macroeconomic front, ADP reported that US private employers created 153,000 jobs during December, much lower than the print of 215,000 during November. Markets look forward to the official US non-farm payroll numbers for December, wherein expectations are calling for an addition of 178,000 jobs.

Crude oil futures were underpinned by reports of Saudi Arabia trimming output in January.
Among other stocks in focus:

SpiceJet Ltd: The airline company is poised to order at least 92 Boeing Co. 737 jetliners as the carrier plots rapid expansion.

Piramal Enterprises: Piramal Finance, a subsidiary of Piramal Enterprises, said it plans to foray into housing finance business. In line with the company's growth plans, Piramal Finance will now make an application to the National Housing Bank for incorporating a housing finance company. This has been approved by the company's board on January 5.

IT stocks in focus: Two US Congressmen have reintroduced a bill to curb the use of H-1B visas, on which the Indian IT sector is particularly dependent, the first salvo in the battle against outsourcing that is expected under the watch of President-elect Donald Trump. The new bill would require workers on the H-1B visa pay a minimum of $100,000, up from $60,000 currently. The bill also removes the Master's degree exemption to the cap on the number of visas available, as per media reports.

Wockhardt: Wockhardsaid German regulator has issued European Union Good Manufacturing Practice certificate to the company's Ankaleshwar facility in Gujarat.

Chartered Logistics: The company registered net profit of Rs 4 crore, up 50%, against Rs 2.74 crore in the corresponding quarter last year.

GM Breweries: The company reported 36% decline in net profit at Rs 10 crore for the quarter ended December 30, 2016. It had posted a net profit of Rs 15.6 crore in the corresponding quarter last year.

SBI: State Bank of India will take the lead among state-run lenders to launch branch-less banking called SBI Digi Bank, something similar to what Citi or DBS have done elsewhere in the world.

Mastek: The comapny’s US entity Digility has acquired TAISTech. In a BSE filing, the company said, “This acquisition will create a platform for Mastek's accelerated growth in the US market and will augment Mastek's 2020 vision to be a global leader in digital transformation services.”

Credit Analysis and Research: The company on Thursday informed bourses that it has been operating in Maldives based on licence issued by Capital Market Development Authority (CMDA), Maldives. The current licence issued by CMDA has expired on January 5. After a review of the past operations and future prospects in Maldives, CARE has decided not to renew its licence. This has been already notified to CMDA.

Sagar Cements: South India based, large cap, cement manufacturing company Sagar Cement's consolidated data shows that for the month of December 2016, the total cement sales was negligibly down by 0.3% as compared to sales during December 2015.

Glenmark: Sanofi has sued Glenmark Pharmaceuticals Ltd and Torrent Pharmaceuticals Ltd in a US court over their plans to launch a generic version of its multiple sclerosis drug, Aubagio, as per media reports.


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