Thursday, 15 December 2016

Nifty holds 8200 amid consolidation; Mid, Smallcap outperform

Equity benchmarks recouped early losses to trade higher with the Nifty holding 8200 level as Federal Reserve acted in line with expectations. Technology and banks stocks helped the market recover while FMCG and select pharma stocks were under pressure. 

10:26 am Dollar strength likely?: Johanna Chua of Citi says investors are likely to persist with long USD strategies against emerging market currencies, reloading these trades in the instances where they prematurely took profits, and joining the consensus where they were previously skeptical or were merely waiting for better entry levels.

Although there remains considerable uncertainty about President-elect Trump's tax and trade policies, investors are likely to take comfort in the belief that that the majority of likely scenarios offer continued support to the dollar, he feels.

10:15 am Nomura on demonetisation: Even as the demonetisation drive is likely to cause short-term disruptions in the economy, the move is part of a foundation being laid out for more stable growth, Japanese brokerage Nomura has said.

Estimating growth to largely remain unchanged for the next 12 months, the Japanese financial services major said the GDP would stand at 7.1 percent in 2016 as well as 2017 and would pick up to 7.7 percent in 2018. The GDP stood at 7.2 percent in 2015.

"Bottom line for India in our view is that there will be short-term growth disruptions (due to currency replacement scheme). However, we think a foundation for more sustainable growth pick up is now being laid," Nomura India Chief Economist Sonal Varma told reporters here today.

"So, we are quite positive on the medium-term outlook," she added.

Also read - Whole era of easy money driving momentum in EMs is over: Udayan 

10:00 am Market Check 

Equity benchmarks recouped early losses to trade higher with the Nifty holding 8200 level as Federal Reserve acted in line with expectations. Technology and banks stocks helped the market recover while FMCG and select pharma stocks were under pressure.

The 30-shares BSE Sensex was up 94.76 points at 26697.60 and the 50-share NSE Nifty gained 30.80 points at 8213.25 while the broader markets outperformed with the BSE Midcap and Smallcap indices rising 0.7 percent each on positive breadth.

About two shares advanced for every share falling on the exchange.

TCS (up 2.7 percent) and Infosys (up 1.6 percent) were the leading contributors to Sensex's gains after rupee weakness against the US dollar as Federal Reserve hinted three hikes each in next three calendar years.

However, Sun Pharma was the biggest loser with nearly 2 percent loss followed by ITC, Tata Motors, Bharti Airtel, ONGC and ICICI Bank.
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