Markets ended on a positive note after initial jitters with recovery led by gains in Nifty Bank while metals and technology stocks continued to remain under pressure as Bank Nifty formed a ‘Bullish White candle’.
There has been a major shift in the sectoral dynamics in the past few weeks and whenever a rally in the market is contributed by gains in banking stocks, it is more likely to turn sustainable and is likely to trigger a swift rally of 20-23% in the near term.
Two data points namely, the ratio of Nifty 50 Index to MCX copper & Ratio of Bank Nifty to Nifty 50 Index hint at the shift of funds flows towards financials in the near term.
The ratio of Nifty to MCX Copper (commodity prices) clearly indicates selling in metal stocks is likely to continue while the benefit from a fall in metal prices may act as a booster to financials along with Auto and FMCG counters.
We expect a major blowout rally in Nifty above 16000. Thus, one can resort to aggressive buying in financials above same.
Ratio of Nifty to MCX Copper & Ratio of Bank Nifty to Nifty 50
Stocks to watch
Positive Read through
- Emami Raises stake in unit Brillaire to 77.53 pct.
- LIC Approves investing Rs 806.7m in LIC Nepal via a rights issue.
- Tech Mahindra Opens new campus in Coimbatore; aims to hire 1,000 in FY23 to grow India operations
- Tata Power To Invest Rs 30B to Set Up Tamil Nadu Solar Plant.
- HDFC, HDFC Bank, HDFC Life- RBI Nod for HDFC-HDFC Bank Merger
- Cipla- No Data integrity observations from US FDA for Indore Plant.
- Tata Motors- Expected H2 to be better than the first half; Chip issue improving.
- Vedanta- Q1 aluminum production up 3%; Zinc India mined metal production up 14% YoY
- Tata Steel Long- Completed acquisition of 93.71% stake in Neelachal Ispat.
- Stain Credit- To consider raising funds via NCD on July 11
- Marksan Pharma- Will consider share buyback on July 8
Negative Read Through
- IndusInd Bank- RBI imposes Rs 10m monetary for compliance deficiency
- Kotak Mahindra Bank – RBI imposes Rs 10.5m monetary penalty for non-compliance with certain norms.
- TCS Says Jury award of damages cut to USD 140m in EPIC matter, Co. will defend its position before Appeal Court.
- RBL Bank – Continues to lose market share; Deposit growth at a 7-quarter low
- Restaurants- Gov. says food bills will not have service charge by default
A financial planning platform where you can plan all your goals, cash flows, expenses management, etc., which provides you advisory on the go. Unbiased and with uttermost data security, create your Financial Planning at Rs. 1499/-
Disclaimer: The views shared in blogs are based on personal opinions and do not endorse the company’s views. Investment is a subject matter of solicitation and one should consult a Financial Adviser before making any investment using the app. Making an investment using the app is the sole decision of the investor and the company or any of its communication cannot be held responsible for it.