- The sharp cuts in the Dow and NASDAQ would continue to put pressure on the Indian markets on Wednesday. The SGX Nifty is under pressure on trade war concerns and the impact of the slowdown on world trade.
- Most sectors came under pressure and we expect metals and companies with vulnerable balance sheets like Dewan Housing, Zee Group and Yes Bank to be under sustained pressure during the week.
- FIIs were net sellers to the tune of Rs. (-645) crore while DFIs bought Rs.819 crore on Tuesday. It has been a general norm that FIIs typically sell out around the election time and then re-enter after the results are out.
- The global markets present a fairly scary picture with markets across the US and Europe losing over 2%. The SGX Nifty is quoting nearer to the 11,400 marks and may be under pressure on opening on Wednesday.
- We have been giving negative reports on Zee for some time now and the sharp correction on Tuesday goes to show the stock is still vulnerable. We expect the stock to get closer to the Rs.300 mark in the weeks to come.
- Marico has announced good results and appears to be one of the FMCG companies to buck the growth trend. With the 5% correction post results, one can look to accumulate the stock for 15% upsides from the current level.
- In a vulnerable market, we expect the IT stocks to lend some support as the dollar swap auctions will also work in their favor. We like Infosys with a price target of Rs.825 in the coming quarter.
- We expect the Chinese visit to the US to be fruitful for trade talks and markets may look to bottom out around lower levels of the Nifty.
