View on market: Volatility Prevails, Market is searching for better value

Tuesday’s gains in Asian shares are expected to be driven by a surge in big tech, which in turn helped Wall Street recover. As investors wait for Federal Reserve Chair Jerome Powell to deliver a significant speech later in the week, rising Treasury yields and probable upward pressure on rates in Asia may cool investor enthusiasm for taking risks. On Monday, the Nasdaq 100 increased roughly 1.5%, with Tesla Inc. rising to its highest level since March, while the S&P 500 stopped its four-day slide. Nvidia Corp. increased by more than 8%, contributing to the artificial intelligence craze that has propelled this year’s equities advance. Meanwhile, Brent crude was trading below $85 a barrel and West Texas Intermediate was below $81-mark. The yield on the 10-year U.S. bond was trading at 4.34% and Bitcoin was below 27,000-level. At 5:16 a.m., the GIFT Nifty, an early indicator of the Nifty 50 Index’s performance in India was down 19 points or 0.10% at 19,380.

Economic Calendar:

  • USD : Existing Home Sales (Jul) on 22nd Aug, 2023
  • USD : Services PMI (Aug) on 23rd Aug, 2023
  • INR : RBI MPC Meeting Minutes on 24th Aug, 2023
  • INR : GDP Quarterly (YoY) (Q1) on 31st Aug, 2023

Brokerage Radar:

JEFFERIES ON GRAPHITES ELECTRODES: HEG – Buy, TP Rs 2170; Graphite – Buy, TP Rs 515; HEG/GRIL are export-oriented plays (70%/50% of sales), benefiting from rising adoption of EAF. HEG’s Q1 beat JEFe, but GRIL missed due to impact of inventory write-down on EBITDA

MS ON GSPL: UW. TP cut to Rs 265 from Rs 319; Muted & volatile volume growth keeps us UW; See holdco discount vs its listed subsidiary remaining wide despite upcoming pipeline tariff revision; Prefer GAIL

UBS ON HDFC BK: Buy, TP Rs 1900; For merged entity, est a 15% EPS CAGR in FY24-26E (4.5%-5.5% decline vs standalone est.); Stock may consolidate here due to near term uncertainties, however expect a re-rating & relative outperformance (vs private peers) in FY25

International Markets

U.S & Europe:

Particulars 21st August Chg. Chg.(%)
Nasdaq 13497.59 206.81 1.56
Dow 34442.95 -20.74 -0.06
FTSE 7257.82 -4.61 -0.06
CAC 7198.06 33.95 0.47
DAX 15603.28 29.02 0.19
Dow Fut.* 34434.10 -29.60 -0.09

Asian markets:

Particulars 22nd August Chg. Chg.(%)
GIFT Nifty 15603.28 29.02 0.19
Nikkei 31776.06 210.42 0.66
Straits Times 3148.61 -5.42 -0.17
Hang Seng 17718.95 95.66 0.54
Shanghai 3097.83 4.85 0.16

ADR Watch:

Particulars       21st August  Chg.       Chg.(%)
Dr. Reddy 71.73 0.33 0.46
HDFC Bank 63.66 0.81 1.29
ICICI Bank 23.11 0.21 0.92
Infosys 16.88 0.16 0.96
Wipro 4.98 0.04 0.81

Commodities & Currency:

Particulars Current Price Chg.(%)
USD/INR 83.09 -0.05
Brent 84.33 -0.15
Gold 1922.95 0.00
Silver 23.323 -0.07

FIIs & DIIs:

Particulars   21st August 18th August
FIIs                          -1901.10 -266.98
DIIs 626.25 339.18

News Update:

Adani Enterprises: Founder firm Kempas Trade and Investment bought 2.53 crore shares (2.22%). The purchase was made from open market between Aug. 7 to Aug. 18. The company has also incorporated a wholly-owned subsidiary Sirius Digitech International to provide digital solutions and services.

Adani Power: The company has targeted a total capacity of 21,110 MW by FY29. This includes proposed inorganic capacity at 1,100 MW, brownfield capacity of 3,200 MW, core existing capacity of 15,210 MW and committed brownfield capacity of 1,600 MW. It sees the net senior debt at Rs 26,690 crore in FY24 vs Rs 24,350 crore in FY23.

Union Bank of India: The board approved to raise up to Rs 5,000 crore from Qualified Institutions Placement. It set the floor price at Rs 91.10 apiece for the issue opened on Aug. 21.

Sanghi Industries: Ambuja Cements has made an open offer to acquire a 26% stake for Rs 767.16 crore. The offer opens on Sept. 29 and closes on Oct. 13.

Tata Power: The company’s arm Tata Power Renewable Energy signed a power purchase pact with Tata Motors for 9 MWp on campus solar plant at Pantnagar in Uttarakhand. The project will be commissioned within six months.

Welspun Enterprises: The company acquired 50.10% stake in Michigan Engineers from Authum Investment & Infrastructure and Sansaar Housing Finance for Rs 137.07 crore. Post acquisition, Michigan becomes a subsidiary.

Lemon Tree Hotels: The hotel chain has signed license agreements for two properties in Bhubaneswar and Kasauli under the brand Lemon Tree Hotel and Lemon Tree Mountain Resort, respectively. The hotel in Bhubaneswar is expected to be operational by Q4FY25, and the hotel in Kasauli is expected to be operational by Q3FY26.

RITES: The company signed an MoU with NHPC to collaborate on comprehensive consultancy services for rail infrastructure facilities for NHPC’s hydropower projects in Arunachal Pradesh.

Source: Moneycontrol, Bloomberg Quint, Investing 

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