- Crude oil at above $80/bbl and domestic petrol prices at Rs.84.40/litre spooked the markets on the inflation front. It opens up the spectre of the RBI hiking rates by 25 basis points in the June policy itself.
- With the Tata Steel acquisition of Bhushan almost through, we expect other key deals pertaining to Essar Steel, Electrosteel and Binani Cements also to be completed. The sector to watch out could be PSU banks on NPA recoveries.
- FIIs were net sellers to the tune of Rs.(-496) crores while DFIs bought Rs.1191 crore on Monday. FIIs have already sold over $2.50 billion in the month and if the INR goes closer to Rs.69/$, then the selling could actually get worse.
- US and European markets showed some positive signs but the pressure on Asia continues. The SGX Nifty is indicating pressure in early trades and this could build up as the INR and crude oil continue to spook India.
- DLF could be the stock to watch out for with a 66% jump in net profits. The debt reduction is finally paying off and despite a lower portfolio, the company promises to get debt-free by March 2019. Buy with target of Rs.260/-.
- The dark horse in the coming week could be the PSBs, especially banks like PNB and BOB which could benefit from the massive write back of NPAs once the NCLT resolution is completed.
- SBI could be the surprise package when it announces its quarterly results on 22nd The bank is expected to disappoint but could actually show positive trends on the back of NPA recoveries and bond loss write-backs. Buy for Rs.275/-.
- Markets will remain weak and at the Nifty level higher levels must be utilized to sell the index or hedge with put options.
