Mid market commentary July 15

Disappointing results from the IT giant Infosys, dragged the benchmark indices to trade in red after making new highs in the morning trade. Both Nifty and Sensex are half a per cent down, whereby markets still maintain consolidation for the third consecutive day. On the whole, markets gave up gains made in the previous session.

On the broader front Midcap segment maintained outperformance by surging 0.3 per cent led by Titan and Indiabulls Housing Finance that surged 2.3 per cent each. Smallcap retreated by 0.37 per cent dragged down by Jaibharat Maruti that tumbled nearly 9 per cent. Market breadth turned negative with 927 advances and 1451 declines.

On the sectoral front Auto sector has risen exceptionally against the markets with nearly 1.5 per cent gains led by Bosch, Tata Motors and TATAMTRDVR rising 2 per cent each. Otherwise defensives like Metal, Pharma, Media and FMCG remain marginally up. IT sector has tumbled the most with more than 4 per cent losses with back to back poor results from majors TCS and Infosys.

Nifty top gainers: Tata Group grabbed the top position with Tata Steel stealing the show with 3.2 per cent upmove. Apart from Tata auto majors, Adani Ports and Bosch followed with 2 per cent gains.

Nifty top losers: Infosys fell 9 per cent after it posted results.The net profit of Infosys has dropped by 6.31 per cent to Rs 3457 crore in Q1FY17. All other top losers belong to the IT sector viz TCS, Tech Mahindra, Wipro and HCL Technologies falling between 2-3 per cent.

Asian markets traded on a positive note after Chinese economy grew 6.7 per cent in its second quarter. However, Shanghai Composite traded in red and closed flat. Nikkei and Hang Seng remained marginally up with 0.6 per cent gains.

Nifty is in consolidation for now. Hence we maintain our view of 8600-8620 as our immediate upside target. On the downside, 8475-8400 will act as support in case Nifty falls below 8500.

Stocks to watch:

Bharat Heavy Electricals: Bharat Heavy Electricals (BHEL) commissions 250 MW eco-friendly CFBC technology-based lignite power plant in Gujarat. The share price will be in limelight for rest of the trading session.

Reliance Industries: Reliance Industries will declare its Q1FY17 results after market hours. The share price will be watched out ahead of Q1FY17.

Lakshmi Vilas Bank: Lakshmi Vilas Bank may sell its 25 per cent stake and may get about Rs 400 crore to 500 crore from the transaction as per media reports. The share price of the bank will be in focus on July 15.

Punjab National Bank: The government may allow capital infusion plan for Punjab National Bank (PNB). The share price of bank will be in limelight during rest of the trading session.

Bharat Forge: BSE sought clarification from the company on the news published on Thursday that the company sold stake in its subsidiary KSSL bringing it down to 50 per cent.