India Morning Report (July 10, 2012) : Choices to get Sector specific again

The NSE NIFTY and the resurgent Sensex with its on Futures trading both decline in smaller doses to settle down to a very likely 5200+ level today at the bottom of the new range. Healthcare can be seen unwinding faster and except TCS all IT stocks could be unable to buck the small dontrend today and maybe the rest of the week. infosys results are due this Friday

The upside of the range is still not capped though most give uo at 5300, as the indices look comfortable to even 5450

Earnings season could deliver faster earnings deceleration as in the bid to define India’s comeback we and most bullish and bearish commentattors have been truly missing the trees for the woods from rertucturing the IIP with Cit and Nomura in the lead to a Credit Suisse target of 59 for the Rupee. The Rupee seems ready to tick down from 56 as it did yesterday but no one seems in  a hurry to buy the Rupee and sell the Dollars. Buying by Oilcos did happen at very reasonable levels yesterday afternoon and we maintain a  Rupee target of 54

Maruti is good for an uptick again as is the res to fthe challenged Auto and 2 wheeler industry except Tata Motors which continue to chip aay at global worries with new Export markets and growing dispatches in double digits(2 wheelers). Maruti can easily expport 20000 units to MENA and Saharan and Sub Saharan Africa if ti can find the right levelrs. Portfolio investment of January to March of $5 B seems safe and not leaving Indian markets. 

Copper is trading down and that should be a leading indicator for the Dollar to break don qafter a 4 day streak. If Oil prices can break 4400 on the downside one can get to evaluating and delivering the price cycle advantage from the same to India Inc

VIX continues to trade at all time los and though that is in sync with Global dondrift from last week, India miught be able to stand more VIX in its market pockets as monsoon catches up to 95% from a 25% shortfall

Power Industry agreement with FSAs and ONGC Vidsesh IPO with a strong performance by Coal India could truly turnaround the India divestment agenda to action. Fixed Income yields despitre  being range bound in 8.16% area might look to catch up to the Reverse Repo rate at 7.5% as liquidity stays improved and it becomes critical for larger bank franchises to catch bigger volumes

Technologically India could be a big market for the Windos 8 devices coming a Android and iOs stagnate at currrent levels as Microsoft could have done a good enough job at good enough prices but then that is a side note.


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