- The week is likely to be driven by the trade sanctions with the US imposing trade sanctions on China and China promising to retaliate. Any trade war like situation will be bad for the markets.
- With oil prices likely to go up again on the back of Iran sanctions, we could see the Nifty facing resistance in the range of 10,800 to 10,850 this week. Any negative vibes on the China trade war will also be negative.
- FIIs were net sellers to the tune of Rs.(-1525) crores while DFIs bought Rs.561 crore on Friday. Selling by FIIs was on the back of large volumes and also included some large block deals.
- Markets across Europe and Asia came under pressure on Friday and that is likely to continue into Monday. SGX Nifty is slightly lower and Asian correction could rub off harder on Indian stocks.
- With the rupee under pressure, the action could be focused on pharma and IT for now. We like Lupin and Aurobindo in the pharma space while Tech Mahindra is our top pick in the IT space.
- We suggest hedging your equity portfolio with lower put options on the Nifty as the markets are vulnerable to any negative news flows. A hedge with Nifty put options will work best in these circumstances.
- We like Strides Shasun at around 390 levels for targets of Rs.500 in one quarter. The Australian acquisition and limited US exposure should work in favour of this company in the coming quarter.
- Trade cautiously as the OPEC meet in Vienna this week and the trade wars could lead to uncertainty in the market movements.
