India Morning Report: MSCI adjustments and a Independence Day /Var Mahalakshmi anniversary ignored

Of course MSCI might have already adjusted the 3% pop in M&M Financials when adding the stock, depending on their process and really there was nothing missing in the NaMo v ManMohan debate on Independence Day but at barely the same 1 PCR after a 2 trading sessions of uptcks on Monday and Tueday the 5750 Cap has hit the sentiment again, and with no scrip exchanges available to smoothly exit, the pressure on Institutional portfolios is also here as the bear from Kotak mentioned in the morning ramps. Axis Bank, Yes Bank and ICICI Bank sufferthe index cut’s worst effects even s Titan gets snared by another loopback on the leased gol imports that the company relies on

I would have prefered to dump 5-6% of SBI float on the markets which I daresay woul have made up for everyone else and be well deserved and HDFC bank and ICICI Bank portfolio holdings are unlikely to be jettisoned or made available as FII float in the arkets so, asking for that to take price cuts is not really achieving any rebalancing

Low Cost Housing did not get the Infrastructure tag is probably the unlisted news working into bankers and brokers’ minds as they come to terms with a new normal for India, in which they have to become equal party disbelievers by dissing growth in the markets or in bank credit from this point. A improbable hyothesis but it can be explained by the right data. More importantly, as feared a year ago, the WPI went and met the CPI rather than the CPI coming down in the battle for relevant inflation with WPI hitting 5.79% for July, niot just fuel and vegetables back to double digits but Manufacturing Products inflation finally factoring in the Fmcg repricing moves to regain lost EBITDA ground. This is topped by structural requirements to high levels of utility inflations and infrastructure creation the new cost of doing business from banks also creeping in going ahead, more of it likely to be absorbed by interest rates as yields come to rest now at a low 8.5% in the 10 year band

Yonex is back in town and the Biyani story has folded, almost.

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