- On Thursday, there was a clear shift in the Nifty towards the defensives with the IT stocks, pharma stocks and the FMCG being the outperformers. The non-HUVR FMCG stocks are now playing catch up in the markets.
- Banks could come under pressure, as could rate sensitive stocks, after the Fed indicated that it may be inclined to hike rates in its September meet. The strong jobs data has only underlined this urgency.
- FIIs were net buyers to the tune of Rs.433 crores while DFIs bought Rs.142 crore on Thursday. Flow trends are likely to be mixed till the time there is greater clarity on the trajectory of Fed rates.
- Markets across the board came under marginal pressure after it became clear that another rate hike would happen in September. The fracas over Trump is also taking its toll on the market. SGX Nifty is also under pressure.
- Steel stocks could be big gainers on lower input prices and higher output price coming from China. Tata Steel at Rs.570 with target of Rs.640 and JSW Steel at Rs.335 with targets of Rs.380 could be the big bets on steel for the quarter.
- Marico, despite the temporary hiccups in Kerala, could be the stock to watch out for. At Rs.380, the stock is having steam despite high valuations, which is true of all FMCG stocks. One can target Rs.415 on Marico in the short term.
- Vedanta at Rs.216 not only offers a good level to enter but also an attractive dividend yield of above 6%. One can look to buy the stock at around these levels for a price target of Rs.250 in the next 1 month time.
- All eyes will not be focused on the Fed meeting in September and the RBI meet in October for future direction of rates, which could be crucial.
