- With election euphoria gone and the shorts mostly covered, the F&O week could be relatively uneventful. The next trigger will be announcements by the government post the formation of the government on 30th
- Global cues will be critical and Friday saw a bounce in the global markets after Trump hinted that the trade war could get resolved soon. Huawei could be used by the US as bait to get the Chinese to agree to a trade deal.
- FIIs were net buyers to the tune of Rs.2026 crore while DFIs sold Rs.(-196) crore on Friday. In the last one week since the exit polls, the FPI flows have compensated for the selling in the first 3 weeks. Stable government could sharpen flows.
- On Friday there was lag euphoria over the likely resolution to the trade war. With Trump going easy on Huawei, world markets stayed in positive territory. SGX Nifty is in negative territory, perhaps after the sharp rally on Friday.
- PSU banks may hold the key to returns in the market and we like stocks like SBI and Bank of Baroda at these levels. Both look good for medium term of 3-6 months with 25% upside target.
- We continued to remain cautious on stocks like IndusInd Bank, Yes Bank and Zee TV as these could again come under bear attack once the short covering on these counters is over and done. Use every bounce to short these stocks.
- After the solid results announced by Bajaj Auto, medium term investors must look to buy this stock in the range of 3000 to 3020 for targets of Rs.3300 in one quarter. It is like to ride the solid export performance from here on.
- There could be global and F&O expiry related volatility. The Nifty may have a struggle to scale the 12,000 mark.
