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Published on 12/06/2019 8:56:38 AM | Source: Religare Securities Ltd

We continue to be cautious on the markets and expect consolidation - Religare Sec

Posted in Market Outlook| #Market Outlook #Religare Securities Ltd

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Nifty Outlook

The Indian equity indices continued their upward trend amidst positive global cues. The Nifty index largely traded range bound throughout the session and briefly touched the 12,000 mark before closing 0.4% higher at 11,966. Amongst the broader market indices both ‘BSE Midcap’ and ‘BSE Smallcap’ too closed higher by 0.8% and 0.3% respectively. On the sector front barring FMCG and capital goods which closed flat, all the other sectors witnessed buying interest with Metal, Oil & Gas and Energy being the top gainers in the range of 0.8-1.3%.

In the near term, we continue to be cautious on the markets and expect consolidation. Macro-economic data (Inflation and IIP) scheduled this week will be crucial for market movement as RBI recently raised its inflation range and indicated towards concern on industrial growth. In addition, global indicators (crude oil prices and currency movement) will also be on investors radar.

 

Stock in News

Tata Motors reported JLR sales for May, 2019 at 42,370 units, down 12% YoY. Jaguar sales declined by 9% while Land Rover sales were down by 13.5%. Region wise, sales were down in North America (-1.5%),UK (-6.7%), Europe (-9.6%), China (-26.4%) and overseas markets (-18.4%).

Bharat Dynamics Ltd. (BDL) signed a contract worth Rs 1,188cr for supply of heavy weight torpedoes. The contract will be executed in the next 3.5 years. In the past BDL has also received defence orders from the Indian Army and DRDO.

BHEL bagged an order worth Rs 440cr from the Nuclear Power Corporation of India Ltd. (NPCIL) for erection of Turbine Generator island units 3&4 at Kundankulam nuclear power project, Tamil Nadu. The company also emerged as the L1 bidder for erection of the Reactor side equipment.

 

Religare Super Ideas

Mahindra & Mahindra Financial Services Limited(M&MFIN)

Buy Mahindra & Mahindra Financial Services Ltd @418-422 Stoploss 410 Target 445 CMP 426.60

M&MFIN has retraced marginally of late, after swift rebound from the support zone of long term moving averages i.e. 200 EMA on weekly chart. Existence of strong support combined with favourable reading from the oscillators is pointing towards steady rise in near future. We advise creating fresh longs within the given range.

 

TVS Motor Company Limited (TVSMOTOR)

Sell FUTS TVS Motor Company Ltd @482-486 Stoploss 494 Target 460 CMP 477.10

Mostly auto counters are struggling and TVS Motors is no different. After making a record high in Jan 2018, it has been continuously trading in a declining trend. Though it had made several attempts in past one year but couldn’t surpass the hurdle of 200 day EMA on daily chart. The current chart pattern indicates further fall in near future. We advise initiating fresh shorts on bounce as per the mentioned levels.

 

Derivative Ideas

NMDC added around 10% in open interest as long buildup was seen in it in previous session. Current chart pattern also indicates further up move in its price. We suggest buying NMDC in cash as per below levels.

Strategy:- BUY NMDC BETWEEN 105-107, STOPLOSS AT 103, TARGET 114.

 

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