All You Need To Know Going Into Trade On Dec. 18

A sell-off in U.S. stocks that sent the S&P 500 Index to its lowest close in 14 months spread to Asia, suggesting investor worries about the outlook for growth that are at odds with the projected Federal Reserve interest-rate hike on Wednesday.

Equities declined in Japan, Australia and South Korea. U.S. futures were little changed after the S&P 500 finished Monday at the lowest since October 2017 and the Russell 2000 Index of smaller companies entered a bear market. The Singapore-traded SGX Nifty, an early indicator of NSE Nifty 50 Index’s performance in India, fell 0.35 percent to 10,875 as of 6:51 a.m.

Short on time? Well, then listen to this podcast for a quick summary of the article!

BQ Live

Here’s a quick look at all that could influence equities today.

U.S. Market Check

• U.S. equity indexes slid to their lowest close in 14 months as investors weighed the impact of the Fed on growth in a market already anxious over trade, geopolitical tensions and a possible government shutdown.

Asian Cues

• Japan’s Topix index fell 1.6 percent as of 9:13 a.m. in Tokyo.
• Australia’s S&P/ASX 200 Index slid 1.2 percent.
• FTSE China A50 futures dropped 0.5 percent.
• Hong Kong’s Hang Seng Index futures were little changed overnight.
• S&P 500 futures rose 0.2 percent. The S&P 500 Index fell 2.1 percent as of 4 p.m. New York time.

Coming Up

• The Fed holds its final policy meeting of 2018 on Tuesday and Wednesday. The rate decision will be followed by a press conference with Chairman Jerome Powell.
• The Bank of Japan’s monetary policy decision is due Thursday, followed by a briefing from Governor Haruhiko Kuroda. A Bank of England decision is also Thursday.
• A partial U.S. government shutdown could start this week if lawmakers and Trump fail to resolve how much money to allocate for Trump’s wall along the Mexican border.

Commodity Cues

• West Texas Intermediate crude declined 1.1 percent to $49.32 a barrel, on track for a third day of declines.
• Gold was steady at $1,246.10 an ounce.
• The Bloomberg Commodity Index dipped 1.2 percent to the lowest in almost 18 months Monday.

Indian ADRs

Stocks To Watch

Who’s Meeting Whom

• Great Eastern Shopping to meet ICICI Prudential AMC on Dec. 18.
• Mahindra & Mahindra to meet Canara Robeco, SBICap Securities and other investors from Dec. 19-20.
• MIRC Electronics to meet RARE Enterprises, Emkay Global and other investors on Dec. 18.

Insider Trading

• Jindal Stainless Promoter Abhuday Jindal acquired 43,000 shares on Dec. 14.

Trading Tweaks

• Capital India Finance ex-date for rights issue at 4:5.
• EIH Associated Hotels, Nitco price band revised to 10 percent.
• Goa Carbon price band revised to 5 percent.

Money Market Update

• Rupee closed at 71.55/$ on Monday versus Friday’s close of 71.89/$.

F&O Cues

• Nifty December futures closed trading at 10,910, premium of 12 points.
• Maximum open interest for December series call at 11,000 strike price, open interest at 44.4 lakh shares.
• Maximum open interest for December series put at 10,500 strike price, open interest at 42.7 lakh shares.

Stocks In F&O Ban

• Adani Enterprises
• Adani Power
• Jet Airways
• Reliance Capital

Put-Call Ratio

• Nifty PCR at 1.61 from 1.53.
• Nifty Bank PCR at 1.38 from 1.21.

Get a detailed drawdown of derivatives on BloombergQuint's F&O page.

Fund Flows

Brokerage Radar

Antique on Indian IT

• Buy-back season for Indian-IT expected to continue.
• Expect Infosys to buy back shares worth $1.6 billion; Wipro buyback post NCLT approval.
• Believe that buyback and increase in overall payout ratio to be key driver.

Kotak Securities on upstream oil companies

• ONGC: Maintained Buy; Hiked target price to Rs 190 from Rs 185.
• Oil India; Upgraded to ‘Buy’ from ‘Sell’; Hiked target price to Rs 200 from Rs 190.
• Higher gas and steady crude to augur well.
• Recent increase in gas prices in U.S. and U.K. to drive sharper increase in domestic gas price.
• Don’t expect government to put excess subsidy burden on oil PSUs.

Kotak Securities on InterGlobe Aviation

• Maintained ‘Buy’; Hiked target price to Rs 1,220 from Rs 950.
• Healthy capacity addition driving share gains.
• Yields data points indicate that the worst is over.
• Favorable movement of either crude or rupee to drive material swing in profits.

Motilal Oswal on IGL

• Maintained ‘Buy’; Hiked target price to Rs 381 from Rs 371.
• Volumes traction remains strong; more room to grow.
• Gurugram could be a key contributor; to start by mid-CY19.
• Triggers: Gas under GST, ban on polluting industrial fuels and increasing penetration.

Nomura on Container Corp

• Maintained ‘Buy; for target price of Rs 800.
• Indian Railways cuts haulage charge for empty containers and wagons by 25 percent.
• Bigger benefit to come from market share gains as the move could boost rail volumes.
• ConCor to see early benefits from Q4; Further recent price hikes to compensate rise in cost.