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

Stock futures suggest small declines in Asia on Tuesday after equities on Wall Street scratched out marginal gains ahead of the Independence Day holiday. Contracts for benchmarks in Japan, Hong Kong and Australia all slid 0.3% or less, following an advance of just 0.1% for the S&P 500 in a shortened session that ended at lunchtime. The Nasdaq 100 added 0.2% on a day that brought data showing a slowdown in manufacturing. U.S. equity futures were marginally lower in Asian trading while currencies steadied. Meanwhile, Brent crude was trading below $75 a barrel and West Texas Intermediate was steady at $70-mark. The yield on the 10-year U.S. bond was trading at 3.85%, whereas Bitcoin was above 31,000-level. At 5:42 a.m., the GIFT Nifty, an early indicator of the Nifty 50 Index’s performance in India was down 0.03% or 7 points at 19,440.

Economic Calendar:

  • USD : Initial Jobless Claims on 06th July, 2023
  • USD : JOLTs Job Openings (May) on 06th July, 2023
  • INR : Nikkei Services PMI (Jun) on 05th July, 2023
  • INR : FX Reserves, USD on 07th July, 2023

Brokerage Radar:

MS ON APOLLO TYRES: Downgrade to EW, TP raised to Rs 425; Commodity cycle & competitive intensity are benign; In FY24, expect co to post EBITDA margin of 15.7% & RoCE of around 11%; With FY25 RoE at 12.3% & P/B at 1.7x, risk-reward balanced

CITI ON ULTRATECH CEMENT: Buy, TP Rs 9,050; Reported 20% yoy growth in grey cement sales vol in 1QFY24 (capacity utilization at 90%), likely driven by strong industry demand + new capacities commissioned over past yr; While demand strong, prices largely rangebound

CLSA ON TATA COM: Buy, TP Rs 1755; Kaleyra acquisition will boost co’s CPaaS offering; Kaleyra is a CPaaS provider with proprietary platforms & revenue of $339m of which 54% is from US market; Deal attractively valued at 0.75x vs TCom’s own valuation 2.5x EV/Sales

International Markets

U.S & Europe:

Particulars 03rd July Chg. Chg.(%)
Nasdaq 13816.77 28.85 0.21
Dow 34418.47 10.87 0.03
FTSE 7527.26 -4.27 -0.06
CAC 7386.70 -13.36 -0.18
DAX 16081.04 -66.86 -0.42
Dow Fut.* 34413.50 -5.00 -0.01

Asian markets

Particulars 04th July Chg. Chg.(%)
GIFT Nifty 19455.00 16.00 0.08
Nikkei 33392.29 -361.04 -1.08
Straits Times 3201.08 -6.02 -0.19
Hang Seng 19404.87 98.28 0.51
Shanghai 3242.94 -1.04 -0.03

ADR Watch:

Particulars 03rd July  Chg.       Chg.(%)
Dr. Reddy 62.53 -0.58 -0.92
HDFC Bank 70.79 1.09 1.56
ICICI Bank 23.39 0.31 1.34
Infosys 16.14 0.07 0.44
Wipro 4.79 0.07 1.48

Commodities & Currency

Particulars Current Price Chg.(%)
USD/INR 81.93 -0.08
Brent 75.13 0.64
Gold 1929.95 0.02
Silver 23.113 0.00

FIIs & DIIs:

Particulars 03rd July 30th June
FIIs                          1995.92 6397.13
DIIs -337.80 1197.64

News Update:

Adani Transmission: GQG Partners bought an additional 3% stake worth Rs 2,633 crore in Adani Transmission. Its shareholding in the company increased to 6.54% from 3.54% earlier. The securities were acquired through the stock exchange settlement process by way of a bulk deal.

Adani Green Energy: The board will consider approving fundraising via issue of equity shares or any other mode including private placement, QIP and preferential issues on July 6. Adani Green Energy had cancelled the meeting in May on account of non-availability of directors.

IDFC, IDFC First Bank: IDFC is set to merge with IDFC First Bank. Shareholders will receive 155 IDFC First Bank shares for every 100 IDFC shares held. Due to the merger, the standalone book value per share of the bank would increase by 4.9%, as calculated on the March 31 financials. The merger stands in favour of the IDFC shareholders by over 16% as per the last closing price of both companies.

IndusInd Bank: IndusInd Bank promoter IndusInd International Holdings Ltd. approved a fundraise of $1.5 billion. These funds are to be used to fund Reliance Capital’s Rs 9,650 crore buyout. IIHL also agreed to raise its stake in IndusInd Bank from 15% to 26%.

Reliance Industries: Reliance Jio launched an internet-enabled phone at Rs 999. The beta trial for the first 1 million Jio Bharat phones will begin on July 7. It includes unlimited voice calls and 14 GB of data for Rs. 123 per month. Other phone brands, including Karbonn, will adopt the Jio Bharat platform to build Jio Bharat phones.

Oil India: The company revised the project capital cost of the Numaligarh Refinery to Rs 7,231 crore from Rs 6,555 crore.

Hindustan Zinc: Mined metal production in Q1 rose 2% year-on-year to 257 kilo tonnes. Saleable steel production remained unchanged at 260 kilo tonnes. Wind power generation was down 13% year-on-year to 130 million units.

Vedanta: Total aluminium production in Q1 of fiscal 2024 rose 2% year-on-year to 579 kilo tonnes. Mined metal output gained 2% from last year to its highest-ever level of 257 kilo tonnes.

Source: Moneycontrol, Bloomberg Quint, Investing 

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