Mid-market commentary Aug 19

Indian markets opened on a positive note, where SBIN cheered with 3 per cent plus up move after the approval of its merger with its associates. The benchmark indices are otherwise flat, where Nifty and Sensex are still retaining 8650 and 28000 marks respectively. The opening price and high price were almost same, suggesting a sluggish to negative movement. Hence we still hold our view of 8700-8730 as immediate resistances, followed by 8765. On the downside, 8650-8600 will act as the supports for now.

Broader markets have outperformed with 0.65 per cent gains each. However, apart from PSU Banks and Metal that are up 2.9 and 1.2 per cent respectively, all other sectors are trading lull. On the stock specific front Hindalco and Bank of Baroda too have soared 3 per cent each. On the contrary Infratel, Coal India and Bharti Airtel are down with more than a per cent loss each.

The positive sentiments throughout Asian markets were because of Brent Crude that stands at USD 50/barrel, fuelled by hopes of an output freeze by key producers and probably a robust US demand. European markets opened on a flat to negative note.

Stocks to watch:

Religare Enterprises: Religare Enterprises’ wholly owned US subsidiary, Religare Global Asset Management Inc., has completed its exit process from Landmark Partners LLC and its subsidiaries. The stock is up 1.5 per cent at Rs 259 levels.

Indian Hotels: According to media reports, Indian Hotels is likely to merge Taj GVK with itself and are in negotiations for determining the swap ratio. BSE has asked for clarification on the same. The stock of Indian Hotels is 3 per cent up.

Steel Authority of India: According to the media reports, lenders of the company are in talks with them to take over management control of Electrosteel. A reply is awaited from the company. The stock is trading up with 1 per cent gains.

Reliance Industries: Government has recently imposed additional USD 380 million penalty on RIL and its partners, who have produced less than targeted natural gas from eastern offshore KG-D6 fields.

Fortis Healthcare: According to media reports, the company is mulling to demerge SRL Diagnostics into a separate entity.