Even after a decent rally recently, Dalal Street is still going through the rebalancing process. While Nifty is at an all-time high, Nifty Next50 are still down 20-25 per cent from their peak levels hit in 2018 and most of the midcaps remain beaten down. As one analyst points out, despite being profitable, a number of stocks still trade at 6-8 times price-to-earnings multiples, around the range a lot of paper companies quote at. This calls for plenty of caution among stock pickers, who have come to the market enthused by the latest surge in prices.
STREET PULSE: Where we stand Nifty futures on Singapore Exchange traded nearly 15 points lower at 7 am (IST), signalling weakness ahead on Dalal Street. Stocks were steady in early Asian trade on Wednesday as investors awaited the signing of an initial US-China trade deal, with sentiment somewhat dented by comments from the U.S. Treasury Secretary's that tariffs would remain in place for now.
HERE'S WHAT TO WATCH  | MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.13%, Japan's benchmark Nikkei and South Korea's Kospi shed 0.29% and 0.48%, respectively, while Australian stocks added 0.33%. |
| Overnight US stocks ended the day with mixed results. Dow ended the day up just 32 points, while S&P500 pulled back 0.1% and Nasdaq Composite slid 0.2% |
| Oil prices slipped on concerns that the pending Phase 1 trade deal between the US and China may not lead to more fuel demand as the US intends to keep tariffs on Chinese goods in place. Brent crude fell 21 cents, or 0.3%, to $64.28 a barrel while WTI crude futures were down 23 cents, or 0.4%, at $58.00 |
| Snapping its five-day winning run, the rupee on Tuesday slipped by 1 paise to close at 70.87 against the US dollar ahead of the signing of the US-China trade deal |
| WHO'S |  |
Trade Deal Setback... Hours before the signing of a preliminary trade agreement to ease an 18-month-old trade war between the world's two largest economies, US and China, Treasury Secretary Steven Mnuchin late Tuesday killed the euphoria, saying the US would keep in place tariffs on Chinese goods until the completion of a second phase of the trade agreement.
Read More Dividend Demand... The government is seeking a record Rs 19,000 crore in dividend from state oil companies — about 5% more than last year— to shore up its finances, according to people familiar with the matter. ONGC and Indian Oil, the biggest in the club, have been asked to pay about 60% of the total. While ONGC has been asked to pay a dividend of about Rs 6,500 crore, Indian Oil is expected to shell out Rs 5,500 crore, BPCL Rs 2,500 crore, GAIL Rs 2,000 crore, Oil India Rs 1,500 crore and Engineers India Rs 1,000 crore.
Read More DMart Stake Sale… Avenue Supermarts, which owns and operates the DMart supermarket chain, is planning a Rs 6,200 crore stake sale to institutional investors as promoter Radhakishan Damani looks to trim his holding to 75% in line with regulations. The company has hired Bank of America Merrill Lynch, JP Morgan and Axis Capital for the qualified institutional placement that's likely to be held next month, said people with knowledge of the matter. Damani has to pare his 80.21% stake to comply with the Sebi's rule.
Read More | LOOK WHO'S |  |
MSME Booster… India could unveil a 'fund of funds' for micro,small and medium enterprises (MSME) sector in the upcoming budget to provide funding line to the sector. "A fund is on the cards," a government official told ET. It would be modeled on the lines of FoF suggested by former Sebi chairman U K Sinha headed committee on MSME. The committee had in June 2019, recommended setting up of a government-sponsored fund to help the sector.
Read More Gold Standards Come In... The government will make hallmarking of gold jewellery and artefacts mandatory from Wednesday by issuing a formal notification, but it will give one year's time to jewellers and retailers to register themselves with the Bureau of Indian Standards (BIS) and clear their old stock. Gold hallmarking, which certifies the purity of gold, has so far been operating on a voluntary basis in recent years. It has being encouraged by the government because of widespread complaints about impurity of gold sold in the market.
Read More Bumper Harvest… India is poised for another record harvest of winter-sown crop as cold weather and showers in key grain-producing areas of northern India are expected to improve yields of wheat, oilseeds and pulses. Wheat acreage is up by over 11%. Agriculture commissioner S K Malhotra said that weather conditions in many states including Punjab, Haryana, Uttar Pradesh and Rajasthan have been very favourable for crops, which would increase food output to a new high.
Read More Meanwhile... Mayday from Motown. Bajaj Auto Managing Director Rajiv Bajaj has sought a temporary reduction in the producer levy on scooters and bikes to help absorb the cost of transitioning to stricter emission norms, arguing that "over-regulation is killing India's two-wheeler industry" that is among the world's biggest. Bajaj urged the Centre to consider a temporary reduction in GST to 18 per cent for two-three years from 28% as the anticipated 20-25% increase in acquisition cost would deter buyers, affecting the industry's financial health and viability.
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