Bulls Slow Down As The Countdown To The Budget 2018 Starts

Market This Week

The market started the week on a fresh record high on Monday as Sensex and Nifty extended the bull run. Sensex traded over 35,700 level while Nifty crossed 10,950 for the first time to trade near 11K. Bank Nifty also recorded new milestone by crossing 27K for the first time. On Tuesday, bulls took charge on D-street as Sensex crossed 36K to recored new high and eventually crossed 36,100 level, too, while Nifty crossed 11K to hit the new milestone. It traded near 11,100 level, Nifty midcap was also up by 1%. On Wednesday, the day before January series F&O expiry; benchmark indices turned volatile as Sensex and Nifty closed in negative but not before Nifty crossed the 11,100 mark. On last trading day of the week, ahead of F&O expiry, the market traded lower.

Throughout the week, the broader market remained volatile as for first two days it traded in positive but in last two day ended on a negative note. Market rally was led by Banking, IT, Metal stocks. Its just in last trading day of week PSU banks reacted negatively to Governments Rs.88,000 infusion as part of the Recapitalisation plan.

Movers & Shakers

Jubilant FoodWorks Ltd, which operates Dominos Pizza and Dunkin Donuts outlets in India, on Friday, said fiscal-third-quarter profit more than tripled on higher sales and better cost management. Net profit rose to Rs.66 crore in the quarter ended 31 December from Rs19.97 crore a year ago. Operating revenue rose 20.7% to Rs.795.16 crore from Rs.658.83 crore. Also, the company appointed Prakash C Bist as the Chief Financial Officer (CFO) with immediate effect. The Stock gained over 15% to hit the all-time high.

Bharti Airtel reported a 39% drop in its consolidated net profit to Rs.305.8 crore for the quarter ended December 31, mainly on account of reduction in domestic interconnection charges. The countrys largest telecom operator also cautioned that the regulator TRAIs recent decision to cut international interconnection charges will further impact the ARPU (average revenue per user). The stock has declined over 10%.

Key Market Drivers

Confidence among Japanese manufacturers jumped in January to an 11-year high, the Reuters Tankan poll revealed today, highlighting corporate optimism driven by nearly two years of continuous economic expansion and a resilient stock market. The positive data should boost the confidence of the central bank, which is set to announce a rosy view of the economy at its two-day policy-setting meeting ended on Tuesday.

WEF ranked India at 62nd place on Inclusive Development Index among emerging economies on an Inclusive Development Index, much below China's 26th position and Pakistan's 47th.

India GDP is anticipated to grow 7.4 percent in FY19 against 6.7 percent this year, gaining pace to 7.8 percent in FY20, the IMF said in its January update of the World Economic Outlook: Brighter Prospects, Optimistic Markets, Challenges Ahead that was released simultaneously in Davos and Washington. Also, The International Monetary Fund revised its economic forecast for developing Asia to 6.6% for 2019 from 6.5% previously, largely due to expected strength in India.

Govt to infuse over Rs.88,000 crore in 20 PSU banks as part of recapitalisation plan. Funds to be infused are as follows - Rs.8,800 crore in SBI, Rs.4,694 crore in IOB, Rs.3,571 crore in OBC, Rs.3045 crore in Dena Bank, Rs.3,173 cr in Bank Of Maharashtra, Rs.2,634 cr in United Bank, Rs.2,187 cr in Corporation Bank, Rs.4,865 cr in Canara Bank, Rs.4,524 cr in Union Bank Rs.2,839 cr in Syndicate Bank, Rs.1,890 cr in Andhra Bank, Rs.785 cr in Punjab & Sind Bank.

Insurance Regulatory and Development Authority of India (IRDAI) will soon be releasing new regulations for brokers as the demand for insurance broking is growing steadily with 428 brokers in the industry as on today, according to TS Vijayan, IRDAI chairman.

Event Watch

The Union Budget by Modi Government, one of the most awaited events for the corporate world, will be presented on next week on 1st February. Q3 Quarterly results will continue in next week.

Stocks To Watch

Indiabulls Housing Finance is on the upside while Rallis India is on the downside.