Sensex, Nifty to open higher; Cipla, RIL, HDFC Bank, Vedanta, Tata Steel, Marico shares in focus

The domestic benchmarks, the BSE Sensex and the NSE Nifty, are set to rise in opening trade on Tuesday, following solid cues from Asian markets. The firm trading on SGX Nifty also indicated a gap-up opening for the domestic bourses, with SGX Nifty futures trading 45 points, or 0.29%, higher at 15,870 on the Singapore Stock Exchange at 8:00 AM. The market is expected to witness a quiet session today in absence of any major development on the domestic or global front, with all eyes on corporate earnings and global cues. The corporate earnings season will begin this week with IT major TCS announcing its numbers on July 8.

According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the market lacks clear direction and this trend can be expected to continue in the context of high uncertainty in the global economy. “There are no clear indicators yet on whether the US economy will slip into recession and how serious the ongoing global growth slowdown will be. Elevated crude and high inflation will continue to drag on markets. The recent correction has made valuations fair but not yet attractive enough for aggressive buying. Leading financials continue to be safe buys. Moderation in commodity prices and improvement in chip availability bode well for autos.”

“Market resilience in July indicates that a close above Nifty 16000 can lead to a near-term rally. Financials, autos and IT have the potential to drive such a probable rally," he adds.

On Monday, the Indian share market ended higher, snapping a three-session losing streak, tracking a positive trend overseas. However, weak rupee and continued fund outflows by foreign investors limited market’s gain. The 30-share BSE Sensex closed 327 points higher at 53,235, and the broader NSE Nifty rose 83 points to 15,835. The top performers in the Sensex pack were Hindustan Unilever Ltd (HUL), IndusInd Bank, ITC, ICICI Bank, PowerGrid, Axis Bank, and SBI. Among the sectors, FMCG gained the most, followed by bank, capital goods, consumer durables, and industrials.

Stocks to watch

HDFC, HDFC Bank: The proposed merger of HDFC with its banking subsidiary HDFC Bank has been approved by the Reserve Bank of India. The scheme has already received 'no objection' certificate from both stock exchanges — BSE and NSE.

Cipla: The pharma major has received two observations from the US drug regulator on FDA Form 483 with respect to ANDA filed for the product to the manufactured at the company’s Indore plant. The US FDA conducted a Pre Approval Inspection (PAI) at plant from June 27 to July 1.

Reliance Industries (RIL): Despite the recent fall in share prices due to the government’s decision to impose new taxes on petrol, diesel, and aviation turbine fuel, a slew of global and domestic brokerages have given a ‘Buy’ rating on RIL.

Kotak Mahindra Bank, IndusInd Bank: The Reserve Bank of India (RBI) on Monday imposed a monetary penalty on these two private banks for non-compliance with loan and KYC directives. A fine of ₹1.05 crore has been imposed on Kotak Mahindra Bank, while IndusInd Bank was fined ₹1 crore.

Hotels and Restaurants: The Central Consumer Protection Authority (CCPA) on Monday issued guidelines for preventing unfair trade practices and violation of consumer rights with regard to levying of service charges in hotels and restaurants.

Vedanta: The mining major has reported a 14% YoY rise in mined metal production in Q1 FY23, driven by higher ore production across all the mines and supported by better mill recovery.

Tata Steel: The Tata group company has completed the acquisition of Neelachal Ispat Nigam through its step-down subsidiary Tata Steel Long Products.

Marico: The company has raised its stake in its recently acquired subsidiary Apcos Natural from 52.38% to 56.52% by buying additional equity up to 4.14%.

Beema Cements: The promoters of the company have proposed to sell 48.91 lakh shares or 15% stake in Beema Cements via offer for sale on July 5-6. The floor price for the sale has been fixed at ₹75 per share.

Kirloskar Ferrous Industries: The company has completed the upgrade of its mini blast furnace II (MBF-11) at Koppal plant, Karnataka.

Marksans Pharma: The board of the pharma company will meet on July 8 to consider a share buyback proposal.

Here are the key things investors should know before the market opens today:

Asian stocks rise

Shares in the Asia-Pacific region were trading firmly in early trade on Tuesday, following positive cues from European markets which finished higher overnight. Wall Street was closed for a public holiday on Monday. Investors awaited the Reserve Bank of Australia’s policy decision, with economists expecting the central bank to hike rates this afternoon to ease inflationary pressures on the economy.

Regional heavyweight Japan’s Nikkei 225 was up 1% after PMI data showed that services sector activity expanded at the fastest pace in over eight years in June. South Korea’s KOSPI jumped 1.8%, Australia’s ASX 200 added 0.3%, while the Straits Times Index in Singapore fell 0.3%.

Similarly, the Hang Seng index in Hong Kong rallied 1%, Taiwan Weighted gained 0.8%, and Indonesia’s Jakarta Composite climbed 1%.

In mainland China, shares were trading on a mixed note, with Shenzhen Component falling by 0.4% and the Shanghai Composite rising by 0.15%.

Oil prices rebound

The price of Brent and U.S. crude rose in early Asian hour trade on Tuesday amid supply concerns due to outages in Libya and expected shutdowns in Norway. However, looming fear about potential global slowdown and fresh Covid-19 restriction in China, one of the world’s largest oil consumers, also dented demand outlook.

In Asian trading hours, the Brent oil for September delivery was trading 0.2% higher at $113.75 per barrel, while the U.S. West Texas Intermediate (WTI) crude August futures were quoting at $110.5 a barrel, up 1.96%.

FIIs continue selling spree

The foreign institutional investors (FIIs) continued their selling spree in the Indian equity market on July 4, while domestic institutional investors (DIIs) continued to support the market. As per the exchange data, FIIs net sold shares worth ₹2,149.56 crore, which was compensated by ₹1,688.39 crore equity purchase by the DIIs.