Market View 5th December 2022

View on market: Stay Cautious, be with quality business:

Stocks opened on a cautious note in Asia as investors weighed the impact of a hot US jobs report and an accelerated shift toward reopening of the Chinese economy. Oil advanced after OPEC+ left oil production steady, sanctions on Russian crude took effect and China’s loosening of Covid restrictions improved the outlook for demand. Investors will watch Reserve Bank of India’s monetary policy, global cues, foreign fund and election results outflows this week.U.S. jobs data was stronger than expected on Friday, raising fears that the Federal Reserve still may not have room to slow down its hikes. A surge in Treasury 10-year yields fizzled out. The S&P 500 fell as much as 1% but erased gains to close 0.1% lower. The Nasdaq 100 fell 0.4%, while the Dow Jones Industrial Average was little changed. Back home, S&P BSE Sensex and Nifty 50 snapped their eight-day gaining streak to end lower on Friday. The S&P BSE Sensex closed 415.69 points lower at 62,868.50, while the Nifty 50 shed 116.40 points to end at 18,696.10. Both the benchmarks scaled new lifetime highs earlier in the week.The focus will stay on the RBI’s Monetary Policy Committee’s rate decision on Dec. 7. At 6:22 a.m., the Singapore-traded SGX Nifty — an early barometer of India’s benchmark Nifty 50 — rose 0.16% to 18,555.

Economic Calendar:

• USD : ISM Non-Manufacturing PMI (Nov) on 5th December, 2022
• USD : Initial Jobless Claims on 8th December, 2022
• INR : RBI MPC Meeting Minutes on 5th December, 2022
• INR : Interest Rate Decision on 7th December, 2022

Brokerage Radar:

CITI ON SAMVARDHANA MOTHERSON: Sell, TP Rs 68; Mgmt. reiterated following: 1) Group rev will reach $36bn by FY25 with ROCE of 40%; 2) 3CX10 strategy will imply that no country, customer or component will be more than 10% of turnover3) Auto segment rev will be 75% of total, rest from new divisions; 4) Dividend payout will be 40% of profit; Still think growth aspirations are ambitious & even if achieved, return ratio & margin would be compromised

MS ON GOLD NBFCs: Initiate OW– Mannapuram Fin, TP Rs 150; Initiate EW– Muthoot Fin, TP Rs 1150; Gold lending has been a biz with supernormal ROE but low growth & competition from bks rising; Diversification is way out; Manappuram looks better positioned both cyclically & structurally

JEFFERIES ON ICICI BK: Buy, TP Rs 1150; Analyst day focussed on strategic initiatives & priorities. Focus is on smoother customer journey, digitisation & network expansion; SME, supply chain financing, ecosystem bkg. & retail are focus segments

International Markets:

U.S & Europe:

Asian markets

ADR Watch:

Commodities & Currency

FIIs & DIIs:

News Update:

Ceat/MRF: The NCLAT disposed of all 14 appeals against the CCI order against certain tyre manufacturers on cartelisation of the industry. The tribunal remitted the matter back to CCI to re-examine arithmetic errors in calculation.

UltraTech Cement: Commissioned 1.8 MTPA greenfield grinding capacity at Dhule Grinding Unit, Maharashtra, and 1.8 MPTA brownfield clinker-backed second grinding capacity at Dhar Cement Works, Madhya Pradesh.

PNB Housing Finance: Paid a fine of Rs 3 lakh to BSE and NSE for not having the requisite number of independent directors.

Ion Exchange: Won a contract Rs 343.36 crore from Indian Oil Corporation for designing, engineering, manufacturing, supply, erection, testing, pre-commissioning, commissioning, performance guarantee test run and operation and maintenance for five years of zero liquid discharge plant at Panipat refinery.

Hindustan Aeronautics: Received an income tax refund order worth Rs 27.45 crore.

Easy Trip Planners: Signed Share Purchase Agreement with Nutana Aviation Capital IFSC to acquire 75% stake in the latter.

State Bank of India: Raised Rs 10,000 crore through its maiden infrastructure bond issuance at a coupon rate of 7.51%.

DFM Foods: The Directorate General of GST Intelligence alleged the Company has been misclassifying its products. The company refuted the allegations and would seek an appeal against the order.

 Source: Moneycontrol, Bloomberg Quint, Investing

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