Motilal Oswal Currency Report on RBI policy deciion The brokerage expects the central bank would maintain a status quo approach as it has many things to monitor in the backdrop. Starting with rising crude oil prices, fund outflows by FIIs from equity and debt segment, balance sheet normalization by the Federal Reserve, strength in the dollar against its major crosses and rising 10-year yields. Nomura on SBI We maintain our positive outlook on corporate banks (with adequate capital levels) with the asset quality cycle nearing its end now, and within PSUs SBI remains our preferred pick given management stability, its strong liability franchise and adequate capital levels. Current valuations at 0.7x FY20F adjusted book seems reasonable for a 12-13% normalised ROE by FY20F and hence we maintain Buy with a price target of Rs 350/share implying 1x FY20F adjusted book. Ahead of RBI Policy Stocks In News Corporation Bank to consider raising of capital by way of issuance of fresh equity shares and/or by issuance of additional Tier – I or Tier – II capital Bank of Baroda has raised lending rates by 5 bps. NMDC: The company’s iron ore output is at 4.5 MT in 2 months of FY19 Hindustan Copper: Company gets nod to carry own exploration, FY19 capex at Rs 700 crore Karur Vysya Bank ties up with Aditya Birla Health as bancassurance channel Bajaj Finance raises fixed deposit rates by 30 bps Ram Vilas Paswan says Cabinet will consider up to Rs 8,000 crore package for the sugar industry. United Spirits receives shareholders’ approval for 5:1 stock split. Mcleod Russel to sell certain tea estates of the company in Assam to MK Shah Exports for Rs 331 crore. ADF Foods to buyback 10 lakh equity shares (4.71 percent equity) at Rs 300 each. Kirloskar Oil Engines to hike prices of power generator sets by 5-8 percent due to rising raw material costs. Nalco sets a capex target of Rs 1,100 crore for 2018-19. (Source: Nirmal Bang report) MARKET COMMENT Amar Ambani, head of research, IIFL The carnage in several counters continued even as the main indices closed with modest losses amidst volatile trade on Tuesday. Sensex fell below 35,000 and Nifty closed below 10,600 mark. Ahead of the Reserve Bank of India's second bi-monthly policy meeting outcome expected today, investors will remain cautious. There is widespread consensus of a status quo on interest rates, but the commentary of the Monetary Policy Committee is expected to take a hawkish stance. A rate hike, if it happens could spook the market. The market will also focus on MPC's view on rising crude oil prices, inflation and US Federal Reserve's rates. The Nikkei Services Purchasing Managers' Index, contracted to 49.6 in May from 51.4 in April, for the first time in three months, though business sentiment improved. Asian shares are trading mixed. Wall Street ended lower. Sectoral Trend
