- Sensex was nearly 350 points in the positive in early trades on Thursday but lost almost all its gains and more and ended marginally in the negative territory. Financials continued to be under pressure on Thursday.
- Even as Yes Bank is likely to react negatively to the rating downgrade, the Zee stock could also come under pressure after the proposed deal between Dish TV and Bharti Airtel for the DTH business ran into valuation troubles.
- FIIs were net sellers to the tune of Rs.127 crore while DFIs bought Rs.399 crore on Thursday. FIIs have been negative on financials and autos on weak asset quality and consumer demand related concerns.
- US markets corrected sharply on Friday on the back of extreme dovishness shown by the ECB Chief, Mario Draghi. The impact is visible across Asia as the SGX Nifty is also in the red in early trades. Markets could remain under weekend pressure.
- The penalty of Rs.3200 crore on Bharti and Vodafone is likely to be negative for the valuations of Bharti. We suggest selling the stock in the range of Rs.335 to Rs.340 for downside targets of Rs.300 on one month.
- We expect most of the Auto stocks to be under pressure after the results of Tata Motors. Expect further downside risk on stocks like Maruti, Eicher and Tata Motors from current levels of up to 10-15% on weak sales outlook.
- Stocks like Lupin and SBI Life could offer defensive bets in a volatile market. We target Lupin with targets of Rs.820 and SBI Life with upside targets of Rs.900 in one quarter from current levels.
- Markets are likely to be under pressure due to weak global cues and also due to the impact of week end unwinding of positions.
