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7 July 2021, Pre Market Report: US markets down after a Rally, Trend reversal from the top for Nifty

Good Morning Everyone, Yet another brand new day and let's get to the action with the pre-market report.

Yesterday the markets fell in the second half lead by Tata motors after JLR came up with a statement that the chip shortage has affected them big time and hence their wholesale plans would be drastically affected, which in turn will build up pressure on Tata Motors as expense rise. Many of us are holding Tata motors shares but, I don't think it will be a matter of concern, since Tata is a fundamentally strong company. Let us wait and watch for good levels to average our holdings in Tata motors.

Global Markets:

US markets were in a mood of consolidation, except for Nasdaq which closed at a record high yesterday. The Dow and S&P 500 fell on Tuesday, with financials and other groups closely tied to economic growth leading to declines.

The S&P 500 banks index fell 2.5% as U.S. Treasuries rallied, with the 10-year yield hitting its lowest since Feb. 24. Data showed U.S. services industry activity grew at a moderate pace in June, likely restrained by labor and raw material shortages.

The Dow Jones Industrial Average fell 208.98 points, or 0.6%, to 34,577.37, the S&P 500 lost 8.8 points, or 0.20%, to 4,343.54

Asia-Pacific was mixed in Wednesday morning trade. In Japan, the Nikkei 225 dropped 0.75% while the Topix index declined 0.52%. South Korea’s Kospi shed 0.68%.

Indian Market:

Trends on SGX nifty indicate a negative opening of the Nifty Index today. Seems like 16000 will have to wait some more as we are not expecting any great news to take the markets higher this week. TCS results will come tomorrow, which will be good but might show lower margins as they have hiked employee perks and salaries in the quarter. However, TCS results will set the market anticipation for the Indian IT sector results for Q1.

India's hiring rate has recovered moderately from 10 percent in April to 35 percent in May 2021, but the aftermath of the second COVID-19 wave has left professionals in India increasingly vulnerable to economic uncertainty.

Foreign institutional investors (FIIs) net sold shares worth Rs 543.30 crore, while domestic institutional investors (DIIs) net purchased shares worth Rs 521.30 crore in the Indian equity market on July 6. FIIs still continue to sell continuously for more than 10 days now. We have to wait for the FIIs to start buying, to get the bulls back to the market.

Stock Specific News:

Kotak Mahindra Bank | The bank’s subsidiary Kotak Securities has entered into an agreement to buy a 9.96 percent stake in Kredent InfoEdge Pvt Ltd for Rs 10 crore.

Mahindra & Mahindra | The company will buy a 31.2 percent stake in ReNew Sunlight Energy for Rs 16.07 crore.

Titan Company | The company recorded revenue growth of around 117 percent (excluding bullion sales) in Q1FY22. The jewelry division grew by around 107 percent (excluding bullion sales), compared to last year, primarily due to zero sales in April of last year. Watches and wearables division grew by around 280 percent, Eye Wear division grew by around 117 percent, YoY.

NMDC | The government’s 7 percent stake sale in NMDC got off to a good start on Tuesday, with institutional investors putting in bids worth over Rs 3,700 crore.

Bajaj Auto | The company has reduced the price of the Dominar 250 bike by Rs 16,800 to Rs 1,54,176 (ex-showroom Delhi).

Sobha | The company achieved a total sales volume of 8,95,539 square feet of super built-up area valued at Rs 682.9 crore in Q1FY22 against 6,50,400 square feet of super built-up area valued at Rs 487.7 crore sold in Q1FY21.

RBL Bank | The bank’s total deposits in Q1FY22 grew by 21 percent YoY to Rs 74,480 crore and gross advances increased by 2 percent to Rs 58,755 crore.

TVS Motor Company | The company has launched a 125 cc scooter NTORQ 125 Race XP priced at Rs 83,275 (ex-showroom, Delhi).

Tata Power | The company’s shareholders approved the re-appointment of its Chairman Natarajan Chandrasekaran as director of the firm.

Mastek | Hiral Chandrana has been appointed as the Global Chief Executive Officer of Mastek Group.

Gillette India | The company appointed Gautam Kamath as Chief Financial Officer and Additional (Executive) Director effective August 1.

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