MARKETS FALL FOR SIXTH STRAIGHT SESSION

  • A combination of high oil prices and global uncertainty took its toll on the Indian markets as the Nifty dipped below the 10,750 marks. The big losers in the market were the oil marketing companies.
  • The issue of pledged shares remains the one big overhang on stocks. It is recommended to stay cautious on any stock where promoter pledge is beyond 60%. More so, this problem is acute for infra and engineering companies.
  • FIIs were net sellers to the tune of Rs. (-250) crores while DFIs bought Rs.1225 crore on Thursday. The FII selling has been sustained in the second week and that has also weakened the INR level.
  • Markets across the US and Europe were flat to tentative ahead of crucial outcomes awaited on the BREXIT front and the trade talks front. Positive trade data from China should be a sentimental booster.
  • Smart investors can look to accumulate oil downstream stocks, especially the likes of IOCL. Subsidies are unlikely to return in a hurry and higher prices will give them an inventory benefit in the coming quarter.
  • One can look to buy Yes Bank on dips after the RBI cleared the bank off its divergence worries. After the 30% rise in the stock today, it would be wise to wait for lower levels to enter the stock.
  • Bata reported stellar results for the third quarter ended December with over 50% growth in profits. Considering rich valuations; wait for a correction around Rs.1200 to accumulate the stock with targets of Rs.1500 in one quarter.
  • After 6 days of selling, one can see some short covering on Friday. However, it would be better to play with light positions.