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

As investors digested data indicating a robust U.S. labour market that will retain pressure on the Federal Reserve to maintain tight policy, Asian equities futures sank after sharp selling in U.S. markets. Contracts for benchmarks in Hong Kong, Australia, and Japan all decreased. The S&P 500 fell 1.4%, marking its lowest day since April, and halting a recent advance that was aided in part by investor demand for firms related to artificial intelligence. As of late Wednesday trade, Qualcomm Inc. was down 2.2% and the Nasdaq 100 was down 2.2% due to a meagre revenue outlook. West Texas Intermediate was trading below the $80 per barrel threshold, while Brent crude was trading at $83. The yield on a 10-year US bond was 4.08%, and the price of Bitcoin was below the 30,000 mark. At 5:21 a.m., the GIFT Nifty, an early indicator of the Nifty 50 Index’s performance in India was unchanged at 19,760.

Economic Calendar:

  • USD : Initial Jobless Claims on 03rd Aug, 2023
  • USD : Services PMI (Jul) on 03rd Aug, 2023
  • INR : Nikkei Services PMI (Jul) on 03rd Aug, 2023
  • INR : FX Reserves, USD on 04th Aug, 2023

Brokerage Radar:

HSBC ON MARICO: Buy, TP Rs 610; 1Q domestic volume up 3% amid weak rural demand; value down 7% due to price cuts; international delivers 16% CC growth; Volumes to pick up in 2H; margin headwinds waning and Marico expects a gross margin expansion of 300-350bp in FY24e

MS ON NAVIN FLOURINE: OW, TP cut to Rs 4951; Co’s constructive outlook across specialty chem & contract manuf. in a tough global demand backdrop was a surprise; A balanced biz mix, still resilient agchem portfolio, new CDMO order wins & upside levers to vol/margins keep us OW

JEFFERIES ON CHOLA FIN: Buy, TP Rs 1350; Adj PAT Rs7bn (23% YoY), 9% below est. due to tad lower NII & higher prov. AUM rose 40% YoY; NIM fell 33bpsQoQ due to higher CoF(38bps QoQ) Board approved QIP of Rs40bn, can be 23% BV accretive if equity is issued at CMP

International Markets

U.S & Europe:

Particulars 02nd August Chg. Chg.(%)
Nasdaq 13973.45 -310.47 -2.17
Dow 35282.52 -348.16 -0.98
FTSE 7561.63 -104.64 -1.38
CAC 7312.84 -93.24 -1.28
DAX 16020.02 -220.38 -1.38
Dow Fut.* 35340.00 57.80 0.16

Asian markets:

Particulars 03rd August Chg. Chg.(%)
GIFT Nifty 19508.00 7.50 0.04
Nikkei 32244.08 -463.61 -1.44
Straits Times 3322.87 -2.15 -0.06
Hang Seng 19436.54 -80.84 -0.41
Shanghai 3252.97 -8.72 -0.27

ADR Watch:

Particulars   02nd August  Chg.       Chg.(%)
Dr. Reddy 69.35 0.07 0.10
HDFC Bank 66.68 -0.87 -1.29
ICICI Bank 24.02 -0.48 -1.96
Infosys 16.52 -0.28 -1.67
Wipro 4.85 -0.08 -1.62

Commodities & Currency:

Particulars Current Price Chg.(%)
USD/INR 82.73 -0.07
Brent 83.33 0.16
Gold 1970.60 -0.22
Silver 23.742 -0.54

FIIs & DIIs:

Particulars   02nd August 01st August
FIIs                          -1877.84 -92.85
DIIs -2.23 1035.69

News Update:

Unichem Laboratories: Promoter Prakash A. Mody sold a 33.4% stake for Rs 945.35 crore to Ipca Laboratories via the block deal mechanism. Ipca Laboratories has made an open offer to the company’s public shareholders to acquire another 26% stake at Rs 440 apiece, aggregating to Rs 805.44 crore.

Vedanta: Twin Star Holdings is likely to sell a 4.3% stake via a block trade, seeking at least Rs 4,136 crore. The shareholder may sell 16 crore shares at a floor price of Rs 258.5 apiece, representing a discount of 5% on Wednesday’s closing price.

Gujarat Gas: The company will buy a 7.87% stake in GSPC LNG for Rs 100 crore.

UltraTech Cement: The company will acquire a 26% stake in VEH Radiant Energy for Rs 15.10 crore. It has signed a share subscription and shareholder agreement as well as an energy offtake agreement with VEH Radiant Energy.

Mining companies: Both houses of Parliament have cleared the Mines and Minerals (Development and Regulation) Amendment Bill, 2023, which opens up deep-seated minerals like lithium mining to private players.

JSW Steel: The company signed a joint-venture deal with Japan’s JFE Steel to produce cold-rolled grain-oriented silicon steel. The project cost is Rs 5,500 crore and will be financed by a mix of equity and debt.

Sheela Foam: The board approved raising up to Rs 1,200 crore via Qualified Institutional Placement. It also approved raising Rs 600 crore via the private placement of non-convertible debentures.

Hindalco Industries: The company has won the bid to mine the Meenakshi West coal mine in Odisha.

NTPC: The company’s subsidiary, NTPC Mining, has won the bid to mine the North Dhadu coal mine in Jharkhand.

Ramkrishna Forgings: The company has formed a joint venture with Titagarh Rail Systems to form ‘Ramkrishna Titagarh Rail Wheels’ for the manufacturing and supply of forged wheels.

Source: Moneycontrol, Bloomberg Quint, Investing

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