Nifty reclaims 8200, Sensex rises over 300 pts; Tata Motors up

Dalal Street CapitalHeight9:30 am Downgrades:  Credit Suisse has downgraded cement stocks like UltraTech Cement, Ambuja Cements and discretionary stocks like Asian Paints, Eicher Motors to underperform and Kajaria Ceramics to neutral. It has We reverted to an overweight on IT and pharma.

Neelkanth Mishra of Credit Suisse said, “While there would be significant but short-term growth disruption from demonetisation for most sectors, for some, impact could last longer. It may take years for currency in the black market to replenish, hurting real estate volumes and prices. NBFCs, construction, cement and discretionary demand to be hurt.”

The market has seen a super strong opening after losing 1200 points in last two consecutive sessions. The Nifty is up 95.45 points or 1.2 percent at 8203.90 and the Sensex is up 257.01 points or 0.9 percent at 26561.64. About 781 shares have advanced, 134 shares declined, and 25 shares are unchanged.

NS Venkatesh of Lakshmi Vilas Bank said, “The rupee fell to a 4-month low on expectations that Trump’s policies may boost inflation in the US and lead to higher interest rates. It is expected to take cues from the equity market and also take support from balance of trade published yesterday which was favourable.”

The dollar held near an 11-month high against a basket of currencies as some stability returned to the US bond market following a vicious sell-off, helped by unexpectedly strong data on US October retail sales.

Global markets are higher as the Trump rally continues and oil rebounds.

Asian shares won the reprieve from a rally in Wall Street shares as the sell-off in global bonds and sharp gains in the dollar paused for now.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.2 percent in early trade on Wednesday, bouncing back from a four-month low touched the previous day. Japan’s Nikkei rose 1.0 percent to nine-month high thanks to the fall in the yen against the dollar.

On Wall Street, the Dow Jones industrial average rose 0.29 percent to a record high while the S&P 500 gained 0.75 percent.

Since Donald Trump’s unexpected victory in the US Presidential election last week, US shares have rallied while US bond prices tumbled, pushing up their yields sharply, as investors expect higher inflation under his presidency.

Voltas, SCI and Ramco Industries will announce September quarter results today. Oil market companies will be in focus as petrol price was  cut by Rs 1.46 a litre and diesel by Rs 1.53 per litre, reversing the rising trend of the past few weeks.

In the currency space, the dollar held near an 11-month high against a basket of currencies as some stability returned to the US bond market following a vicious sell-off, helped by unexpectedly strong data on US October retail sales.

Saudi energy minister is expected to travel to Doha, this week for meetings with oil-producing countries on the sidelines of an energy forum.

Gold edged higher, snapping a three-session losing streak, on uncertainty over the economic policies of US President-elect Donald Trump. Trump has vowed to boost domestic spending, which has the potential to stoke inflation and dent demand for non-yielding bullion, but the market is seeking more detail on his policies.

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