9:50 am Market outlook: The market is technically
overbought and unlikely to rise much in the near term, feels Sanjay Dutt of
Quantum Securities. He compares the ongoing rally with the frenzied bull market
of 2007-08, and says the recovery in corporate earnings has already been
discounted.
In an interview Dutt says the market
still looks from a medium term perspective, but the government needs to address
the issues being faced by small and medium sized companies.
He expects liquidity flows to be strong, but the supply of share offerings
is expected to cap market gains.
Dutt is bullish on financial services and banking stocks, and is betting on
capital goods and EPC (engineering procurement and construction) companies to
play the domestic recovery.
9:40 am Buzzing: Shares of HCL Tech surged 11 percent,
hitting record high at Rs 1834 per share intraday after it posted stellar
December quarter earnings.
The fourth largest software services exporter in India, surpassed street
expectations on every parameter by reporting 2.3 percent sequential growth in
profit after tax at Rs 1,915 crore. Profit was expected at Rs 1,770 crore on
revenue of Rs 8,950 crore for the quarter, according to the average of
estimates of analysts polled.
Revenue grew 6.3 percent quarter-on-quarter to Rs 9,283 crore and dollar
revenue rose 4 percent to USD 1.49 billion during October-December quarter (as
against expected dollar revenue of USD 1.477 billion).
9:30 am Brokerages on OFS: Brokerages are mixed on Coal
India with Edelweiss upgrading it to buy with a target price of Rs 442 per
share. It feels that volumes push and government’s sharp focus on doubling
CIL’s production by FY20 will bring cheer to the stock. Edelweiss also says
that saving from low diesel prices to aid margin expansion as every Rs 1/litre
drop in fuel cost saves Rs 100 crore for Coal India.
Nomura has a buy rating with a target of Rs 443 per share. "As has historically
been the case, we believe Coal India may well consider declaring an interim
dividend next month. As investors who buy stocks in the upcoming OFS would be
allocated shares on February 2/3, prospects of an imminent interim dividend may
well act as a sweetener,” Nomura says.
However, JP Morgan is underweight on the stock with a price target of
Rs 325 per share as given the stake sale there is less room for a repeat of
last year’s dividend. “There is no explicit dividend policy in place and hence
predicting dividend is difficult. However, the combination of a stake sale and
potentially lower dividends should result in the stock being under pressure,”
it says in a note.
Don't miss: Asia
rallies as oil gets a reprieve; earnings in focus
It is a record high opening as the Nifty approaches 9000-mark on first day
of February F&O series. The 50-share index is up 44.20 points at 8996.55.
The Sensex is up 140.11 points at 29821.88, and the Nifty About 497 shares have
advanced, 115 shares declined, and 151 shares are unchanged.
Coal India is down 4 percent as its offer-for-sale opens today. Bharti
Airtel, HDFC, Tata Motors, SBI and Sesa Sterlite are top gainers in the Sensex.
The Indian rupee has opened at 61.79 per dollar, up 7 paise compared to
previous day's closing value of 61.86 a dollar.
Pramit Brahmbhatt, Veracity says continuation of FII inflows coupled with
some profit booking in local equities may impact the rupee in trade today. He
expects USD-INR to trade in the range of 61.40-62.40/USD.
US markets bounced back from a two-day rout, led by a reverse in the price
of crude and strong job market data. European markets closed mixed on Thursday,
with a sharp decline in Shell shares hitting the UK's FTSE 100 index and Asian
markets were trading higher in morning trade on a positive US handover.
In commodities, Nymex Crude held steady around USD 44 dollars per barrel as
US jobless data signaled further strength in economy. Brent crude was trading
around USD 49. Gold edged higher after falling more than 2 percent to a
two-week low overnight on concern over a looming increase in US interest rates.
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