India Equity Research: Market Mantra

11 September 2014

Market Mantra

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Market Mantra

Weakness at start!

The rally has taken a temporary break with profit booking seen in realty, IT, oil & gas, banking and capital goods. For now FMCG, power, healthcare, and consumer durables seem to survive the cooling. Mid-caps and small-caps remain on the buying list and retail money seems to be pouring in through mutual funds too. No wonder, local funds manage to overtake the FIIs in August. Reports indicate that while domestic funds have deployed nearly $1.14 billion in August this year, one-fourth of the AUM is concentrated in 10 stocks including ICICI Bank, HDFC Bank etc.

The outlook is a weak start. The global cues are nothing much to cheer about. Attention will be on infra counters as the Prime Minister is scheduled to hold his first review meeting of infra projects with secys of key ministries later today.

ICICI Bank could be in action after it announced that its board had approved the splitting of each equity share into five.

India plans to release GDP data based on the 2011-12 base year by early next year, that could theoretically revise up the growth estimates, says a report.

Economy snippets

² The bench headed by Chief Justice, which declared some 218 allocations illegal last month, reserved the order, which will come within the next two weeks. Attorney General reiterated that “only a pocket of some 46 units can be saved”. The government was also against any committee to hear individual complaints by allottees. (BL)

² The Reserve Bank of India said managing directors and CEOs of private sector banks will be allowed to hold office till the age of 70. (BL)

² The Steel and Mines Ministry has sought rollback of 2.5% duty on coking coal imports, imposed in the last Budget, to unburden domestic steel makers. (BS)

² Government is unlikely to consider any proposal for bringing down export duty on iron ore even as the price of the steel-making raw material nosedived to five-year low at around US$84 per tonne in the global market. (BS)