Weekly Market View – 7 December 2019

Indian Market Outlook:

Key benchmark indices ended with modest losses after seeing high volatility during the week. Selling was witnessed in index pivotal after the central bank kept interest rates unchanged and slashed its growth forecast for the economy. The Nifty ended below the psychological 12,000 mark. In the week ended on Friday, the Sensex fell 348.66 points or 0.85% to settle at 40,445.15. The Nifty 50 index declined 134.55 points or 1.12% to settle at 11,921.50.On the macro front, IIP and manufacturing production data for October 2019 will be announced on 12 December 2019 while WPI inflation (YoY) data for November 2019 will be unveiled on Friday, 13 December 2019. Going forward, Global cues, and macroeconomic data, Forex fluctuation, crude oil price movement and investments by FPI and DII will be watched in the week ahead. Developments in the Winter Session of Parliament will be closely watched which will conclude on 13th December. Overseas, developments on the U.S.-China trade front will be closely watched. As per reports, China’s finance ministry said the country will waive import tariffs for certain soybean and pork shipments from the U.S., without providing further detail. The Federal Reserve’s two day meeting begins on Tuesday, 10 December 2019 and the interest rate decision will be announced on Wednesday, 11 December 2019.

Latest Spot Price (in US $)

Global Weekly Events

Domestic Economy Indicators

Economic News:

• After five rate cuts in a row, the Reserve Bank of India (RBI) has finally hit the pause button. The central bank, on Thursday, in its latest monetary policy review kept the repo and reverse repo rates unchanged. RBI governor Shaktikanta Das said that although the central bank is in no hurry to keep reducing interest rates, it would work to ensure that the transmission turns more effective since much needs to be passed on. The repo rate currently stands at 5.15 per cent and reverse repo rate at 4.90 per cent.
• Union Finance Minister Nirmala Sitharaman on Saturday said the Modi government could bring in more measures to reinvigorate the sagging economy. The FM, during the HT Leadership Summit in New Delhi, said the Union government had taken many initiatives in August and September. Elaborating on the steps taken by the government, the FM said the public sector banks had disbursed around Rs 5-lakh crore in these two months to boost consumption in the country.

    Industry News:

• Auto component sales in India fell 10% to $26.2 billion (Rs 1.87 lakh crore) in the first six months of the ongoing financial year, amid a broader slowdown in consumption in the local market, the Automotive Component Manufacturers’ Association (ACMA) said.The sluggish demand environment has resulted in the loss of about 1,00,000 jobs in the sector till July 2019, said the industry body. Mostly temporary workers lost jobs as companies scaled down production on the back of weak vehicle demand.
• The ministry of civil aviation (MoCA) recently announced that it is kicking off the fourth phase of the UDAN (Ude Desh ka Aam Naagrik) scheme. It aims to improve connectivity to remote and regional areas (like North East regions, hilly states, Jammu and Kashmir, Ladakh) besides giving flexibility to airlines in designing their network, promoting short-haul routes, and revising the parameters of VGF (viability gap funding).

Company News:

• SEBI has ordered state-owned insurer Life Corporation of India, State Bank of India (SBI) and Bank of Baroda (BoB) to cut their stake in UTI Mutual Fund to below 10 per cent from the current 18.25 per cent by December 31, 2020. SEBI also said if these entities would fail to comply with the directives, their shareholding and voting rights in UTI AMC and UTI Trustee Companies over 9.99 per cent and corporate benefits would stand frozen till they did so. They have been told to submit a compliance report within a month from such compliance.
• Axis Bank’s Jairam Sridharan has resigned from the post of group executive and chief financial officer, the lender informed bourses on Friday. The private sector bank said Sridharan would like to pursue other career opportunities and as such has resigned from the services of the bank. Jairam Sridharan will continue to serve as the group executive and chief financial officer of the bank under his notice period of three months.
• Bank of America Corp. and Kotak Mahindra Capital Co. are among banks Indian billionaire Radhakishan Damani picked for another planned stake sale in Avenue Supermarts Ltd., owner of the DMart brand, said people with knowledge of the matter. A 5.2% stake in Avenue Supermarts would be valued at around 58.7 billion rupees ($823 million), based on the closing price in Mumbai on Friday. The founders hold about 80.2% of Avenue Supermarts, including about 37.4% by Damani.

Global News:

• China is planning to exempt some US soybeans and pork products from tariffs, a move that could take some heat out of talks aimed at agreeing on a truce in the trade war. Trade in soybeans and pork has been hit hard as tensions have escalated between the world’s two largest economies. Both products were among thousands of US goods hit by Chinese tariffs last July 2018 in response to the Trump administration’s taxes on $34 billion of Chinese goods.
• U.S. stock index futures edged higher on Friday as comments from President Donald Trump that trade talks with China were “moving right along” helped set a calmer tone ahead of the Labor Department’s much anticipated monthly jobs report. Trump’s remarks around the discussions came after Chinese officials reiterated their stance that some U.S. tariffs must be rolled back for a phase one deal.

(Source: Economic Times, Business Today, Investing,CNN)

 Forthcoming Corporate Actions (9^th December to 14^th December)

Source: BSE, Elite wealth Research

Upcoming Board Meetings (9^th December to 14^th December)

Source: BSE, Elite wealth Research    

 DISCLOSURE IN PURSUANCE OF SECTION 19 OF SEBI (RA) REGULATION 2014

Elite Wealth Advisors Limited does/does not do business with companies covered in its research reports. Investors should be aware that the Elite Wealth Advisors Limited may/may not have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as read more

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