- The big bull rally on Friday is likely to continue into Monday as the short covering could take the markets still higher. We expect the short covering in auto and banking stocks to continue with the positive sentiments in FMCG stocks.
- Oil prices could fall further on Monday on the virtual breakdown of the trade talks between China and the US. Lower oil prices will also contribute to the positive sentiments in the stock markets. FPI deals with be the key.
- FPIs were net buyers to the tune of Rs.36 crore while DFIs bought Rs.3001 crore on Friday. Surprisingly, FPIs were extremely tepid buyers but there was heavy short covering by FPIs in index and stock futures. Monday will be crucial.
- Markets across the Europe and Asia were flat to negative on trade talks hopes while the US markets fell China did not visit the Montana farms. SGX Nifty is virtually flat but short covering could hold the key on Monday.
- We see further upsides of around 9-10% in stocks like Hero Moto, Britannia and Eicher Motors. However, you are suggested to limit buying in these counters only on dips to get a better price in the market.
- Financial scan be a big beneficiary and beaten down broking stocks could be in the midst of action. We suggest buying Edelweiss at a price of Rs.122 for immediate short term targets of Rs.150 and higher.
- We reiterate our negative stand on Zee. With promoters barred from further selling of his stake and MFs forced to postpone the deadline, the stock is still a good sell at 302 with downside targets of Rs.270 in one quarter.
- Monday could be a mixed day with the disappointment over the trade talks. But the short covering could sustain markets at a higher trajectory.
