Strong US Markets; Wipro, Tata Steel, Bank Stocks & Other Top Cues to Sway the Market Today

Indian share markets closed on a higher note in previous trade as Sensex and Nifty rallied to all-time peaks, with IT stocks and capital goods stocks leading the gain. While the Sensex inched near 34,000, the Nifty ended slightly short of 10,500. In intraday, both scaled life highs.

At the closing bell last week, the BSE Sensex closed higher by 184 points and the NSE Nifty finished higher by 53 points. The S&P BSE Mid Cap finished up by 0.1% while S&P BSE Small Cap finished up by 0.6%.

Top Stocks to Watch Out

Tata Power share price is expected to see some action today after it was reported that the company said its Russian subsidiary, Far Eastern Natural Resources LLC, has bagged the mining licence for a thermal coal mine in Kamchatka province in far east Russia.

In news from software sector, Wipro Ltd has invested US$2.05 million and acquired minority stake of less than 20% on a fully diluted basis in Imanis Data (formerly Talena). Wipro has made a strategic investment of US$2.05 million in this tranche, taking total investment to US$4.05 million.

Meanwhile, Infosys share price hit its 52 week high in previous trade. As per an article in The Livemint, Infosys has completed its Rs 130 billion buyback program that saw participation from Sudha Gopalakrishnan, Rohan Murty and Life Insurance Corporation of India (LIC) among others. The buyback had been a long-standing demand by some of the founders and high-profile former executives, who have been pushing Infosys to return surplus capital to shareholders.

Dilip Buildcon share price surged 7% in previous trade and is expected to see momentum going as the company plans to raise 6 billion via issuance of non-convertible debentures on a private placement basis.

Tata steel share price is expected to be in limelight today after it was reported in The Economic Times that German steel giant Thyssenkrupp has announced a "negotiated settlement" with its workers to clear the way for its proposed joint venture with Tata Steel Europe.

In news from banking sector, bad loans of public sector banks (PSBs) stood at Rs 7.34 trillion by the end of second quarter this fiscal, a bulk of which came from corporate defaulters. However, on the other hand private sector banks' non- performing assets (NPAs) were considerably low at Rs 1.03 trillion by September 30.

Yes Bank share price is expected to see some action today after it was reported that the company has established a medium term note program to raise US$1 billion (over Rs 64 billion) by issuing debt securities on private placement basis.

Meanwhile, state-owned Bank of Baroda (BoB) said its board has approved raising of Basel III compliant Additional Tier I (AT-1) capital up to Rs 40 billion from bonds to fund business expansion.

IPO Segment

Indian stock markets raised US$ 11.6 billion through as many as 153 initial public offers. According to the report, the fourth quarter (October-December) of this year saw 22 IPOs hitting the market, an increase of 47% QoQ in terms of number of deals.

The report further said that 2017 saw the highest deal numbers and proceeds on record, reflecting the country's economic strength and rising investor appetite. The combination of primary market growth and overall economic growth is set to make India a highly attractive emerging market for investments in the coming months.

The market euphoria is something similar to what was seen in 2007-08. When everyone around you is clamoring to get a piece of the IPO pie, it makes sitting tight difficult. And, why should you sit tight when stocks like Avenue Supermart lets you pocket a cool 100% gain from day 1 of the listing?

History suggests that these cases are few and far between. More than 70% of the IPOs listed in 2007 and 2008 are in the red, even today when the Sensex is at an all-time high.

This allows us to stay on the fence when it comes to investing in IPOs. But it doesn't make sense to completely ignore this space. For every Reliance Power - like issue, there have been issues like Maruti, TCS, and Jubilant Foodworks Ltd(with returns over 4,000%, 1,000% and 500% respectively) that have created immense wealth for shareholders. A merit-based selection primarily including valuation, business, and management quality is the logical way to go about it.

Bitcoin Continues its Wild Trade

Bitcoin prices briefly plunged below US$13,000 on Friday, capping a stunning 24 hours in which the digital currency lost as much as 25% of its value, according to data from CoinDesk.com.

Prices, which had approached US$20,000 as recently as Sunday, bounced back to trade around US$14,000.

The turbulence comes on the back of a few days of bad news for bitcoin, which has still soared by more than 1,300% since the start of the year.

US Markets Continue to Remain Strong

The Dow Jones industrial average and the S&P 500 posted gains for the fifth straight week on Friday after President Donald Trump signed a bill that revamps the U.S. tax code. Trump signed a bill on Friday that slashed the corporate tax rate to 21% from 35%.

European markets finished lower on Friday with shares in France leading the region. The CAC 40 is down 0.39% while Germany's DAX is off 0.28% and London's FTSE 100 is lower by 0.15%.

Investors are nervous about the future of the Spanish region of Catalonia, where voters backed pro-independence parties during an election. The euro lost ground against other major currencies following the vote.

Oil Prices Dip

Oil prices dipped last week in light volumes but stayed near their highest levels since 2015 on pledges from OPEC leader Saudi Arabia and non-OPEC Russia that any exit from crude output cuts would be gradual.

To keep a tab on the movements in crude oil and other commodities, you can read the stock market commentaryfrom the Daily Profit Hunter team. Their commentary tracks the developments in the global economy as well as stock, currency and commodity markets.

This article was originally published in English at www.equitymaster.com

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