BSE, NSE likely to open strong; key stocks to watch

BSE Sensex and NSE Nifty are more likely to continue on their sturdy upward momentum in opening trade on Tuesday.

BSE Sensex on Monday closed up zero.68%, at 28,66158 factors while NSE Nifty saw a fifty seven.50 factors upward push to shut at eight,879.20 points.

Key shares to observe:

Tata Consultancy services and products: TCS on Monday mentioned that the company will spend Rs sixteen,000 crore to buyback 2.eighty five% fairness shares at Rs 2850 per share. Shares of the corporate won on Monday in anticipation of the news.

Ambuja Cements: the corporate mentioned higher than anticipated net profit for the quarter ended December 31, 2016.

Infosys: Vishal Sikka, CEO and MD of the IT major has refuted claims made via a whistle-blower. He stated that malicious tales are being unfold to target him.

ONGC Ltd: The state-owned oil main has settled tax dispute with Gujarat govt. ONGC's overseas arm OVL has despatched out RFP to raise mortgage to refinance an acquisition.

Siemens: the corporate has won a contract value Rs 287 crore to set up signalling programs for Nagpur Metro.

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Rupee opens 13 paise up against dollar; extends gains for 3rd day

The rupee extended its winning run for the third consecutive day on Friday and opened 13 paise higher at 67.83 against dollar on sustained dollar unwinding from banks and exporters. The local currency on Thursday settled 9 paise higher at 67.96 against dollar.

Meanwhile, domestic equity indices, BSE Sensex and NSE Nifty, opened on a flat note with positive bias following mixed global cues. The 30-share Sensex opened 51 points, or 0.19 per cent, up at 26,929.69, while the 50-share Nifty index kicked off the day at 8,281, 0.10 per cent higher than the previous close.

The local currency was trading around 12 paise higher against the previous close at 9:15 am (IST).

Meanwhile, the RBI on Thursday fixed the reference rate for the dollar at 67.7884 and euro at 71.5574. In cross-currency trade, the rupee fell against the pound sterling to settle at 83.65 from 83.44 yesterday.

Amit Gupta, Co-Founder and CEO, TradingBells said, “Strength in emerging equity markets as well as currencies has put pressure on the dollar. The USD-INR pair may show some recovery on Friday.”

Amar Ambani, Head of Research, IIFL said, “Greenback is witnessing some liquidation, as the recent rally is based on the euphoria of expected higher infrastructure spending and heavy corporate tax cuts by the US President-elect Donald Trump.”

Foreign institutional investors (FIIs) continued to remain net sellers in domestic equity markets on Thursday as they sold shares worth Rs 681.93 crore with gross purchases and gross sales of Rs 3,544.24 crore and Rs 4,226.17 crore, respectively.

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Consortium of Chinese companies buys stake in Pak bourse

A consortium of Chinese companies has bought a 40% stake in Pakistan Stock Exchange (PSX) for $85 million. This is perhaps the first big price that Pakistan is being asked to pay in return for Chinese investments in the China-Pakistan Economic Corridor, which is expected to cost $46 billion.

The consortium, including three bourses China Financial Futures Exchange, Shanghai Stock Exchange and Shenzhen Stock Exchange, picked up a 30% stake in PSX. The other members of the consortium, Pak-China Investment Co and Habib Bank, bought 5% each. PSX sources had said a British consortium, along with local banks, was also in the fray.

This is the first time the Chinese companies have acquired stakes in a foreign stock exchange. A consortium of Chinese companies has been trying to acquire the Chicago Stock Exchange for nearly a year but it is facing resistance from a group of US senators.China is now trying to connect the Shanghai stock exchange with the one in London. It has recently connected the Shanghai exchange with those in Hong Kong and Shenzhen.

The China Securities Regulatory Commission has made it clear that it supports the acquisition, and expressed the hope that the risks involved are within limits. “This investment will help broadening economic and financial collabora tion between China and Pakistan and will help implement the Belt and Road Initiative and the China-Pakistan Economic Corridor,“ the Shanghai Stock Exchange said.

PSX expects that the investment will bring experience, technological assistance and new products, according to a report in Dawn, a Pakistani news outlet quoting a PSX official. “After Chinese capital flows into the Pakistan's bourse, the market will be more internationalised and capital that flows into the country will likely to benefit the local economy and enterprises,“ Liang Haiming, chief econo mist with Guangzhou-based China iValley Research Institute, said in an article in the Global Times ..

The PSX was set up in January 2016 when the Lahore, Karachi and Islamabad stock exchanges consolidated into one bourse. PSX was included in the emerging market index of the Morgan Stanley Capital International in June last year. “Pakistan's market reform has been accelerating in recent years and the country has received backing from global institutions and overseas capital, making PSX more appealing to global investors than before,“ Bao Kaijun, an analyst with Shanghai-based Kunyuan Investment Advising Services, told the Chinese media. The media also quoted Zhang Wenlang, an analyst with  Everbright Securities, saying that there will be more collaborations between Chinese financial institutions and overseas ones.

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