• After a strong start the Nifty and the corrected sharply on the back of very thin volumes. The trigger came when there was an unwinding of most of the positive trades of the last few days, especially among the ADAG stocks.
• With the likely modification to the H1B visa rules, the new condition of corporate accountability is likely to make a lot of companies nervous. Likely to be negative for stocks like Infosys, TCS and Wipro.
• FIIs were net buyers to the tune of Rs.326 crores while DFIs sold Rs.(-1300) crore on Monday. The sharp FII selling was more of a new year adjustment after the rapid rally in the last few days and not much needs to be read into it.
• Markets across most of parts of the world were shut for the New Year and there was little by way of global cues for the Indian markets. The SGX Nifty is showing signs of further pressure in the coming days.
• After the monthly numbers, we see TVS Motors being a major driver for the auto sector growth with a 39% growth. We like the stock and see the stock touching the Rs.1000 mark in the first half of the year. Position yourself accordingly.
• The stock to watch out for in the metals space could be NALCO. It has still underperformed compared to Hindalco but its low level of debt is a huge positive. With Chinese demand robust, NALCO could now get beyond the 100 mark.
• PNB could be the dark horse as it is likely to benefit the most from the Insolvency code. The advantage is that PNB borrowers have a portfolio of quality assets which can be easily monetized reducing the haircut. Target Rs.210 on the stock.

We recommend aggressively buying into stocks like TVS Motors and PNB at current market prices.