- Markets continued to react in an ambivalent fashion ahead of the Fed meet and the key macro data announcements in India. Financials have also been a little quiet after the monetary policy held status quo on rates.
- The markets are awaiting a tax relief package on personal taxes from the finance minister which was hinted at last week. A boost to personal tax cuts will be a good antidote to rising inflation and falling growth rates.
- FPIs were net buyers to the tune of Rs.459 crore while DFIs bought Rs.75 crore on Monday. FPIs have turned net sellers in December and it remains to be seen if there is a shift in FPI activity in the coming months.
- Markets across the US and Europe were under pressure after the trade deal continued to look elusive. Asia has been ambivalent although SGX Nifty is marginally in the green. A lot will depend on how the trade war pans out.
- With SBI cards business getting lofty valuations, one can look at RBL Bank where the sizable value of the cards business is yet to be factored. Buy RBL Bank at Rs.338 for targets of Rs.385 in the next quarter time frame.
- After the recent downgrade on SBI Life, the stock is likely to come under pressure. Holders in SBI Life can look to sell the stock and then re-enter at lower levels. Life insurers are likely to be under pressure due to rich valuations and weak margins.
- DLF still looks a good bet at around Rs.215 with targets of Rs.250 on the upside. The decision to become debt free by middle of next year is likely to be positive for the cash flows and the financial viability of DLF.
- Markets are likely to remain cautious on the upside due to an overhang of global news flows and domestic macro factors.
