India Morning Report: The Rupee now counting 63..62..61 , the Nifty counting 5900..6000 ..then?

The PCRs are already hanging by athread. But the long seen unloading in IDFC seems to be at an end with FT announcing investibility changes in IDFC and HDFC for the rebalancing from Sept 22. IDFC investibility is down to 54% from 74% and HDFC likely to see $208 mln inflows (JPM) from investibility rating increase from 74% to 100%. IDFC is also up 7% on the far end to the big story and is likely to move up with its close association with infra debt like at JP Assoc also relieved by Manoj Gaur’s latest sale of a 4.8MTPA Gujarat plant to a now 59 MTPA Ultratech under the Birlas (KM)

Meanwhile the index comfortably opened the sultry day proceedings at above 5900 and the Rupee almost tore into 62 levels before retreating towards yesterday’s day end levels. Friday’s 6000 level run  is thus still a given though the markets are not seeng serious buying right now and is not yet under the bullish impact of such salubrius India winning strategies as Import substitution. The $10.9 Bln deficit, a very respectable low given recent scores since 2009 is however still near the Post reform highs than the average rate as could be assumed by India Investors and the $75 -80 Bln trade deficit targeted may well be just par for the course if India Inc does achieve it, with Gold imports already under 1 MT in August (650kg)

English: Panorama of Sachivalay (Gujarat Legis...
English: Panorama of Sachivalay (Gujarat Legistative Assembly) at Gandhinagar (Photo credit: Wikipedia)

New layers of investors returning to the markts however muddy the prospective recovery levels of the recovery, some like Kotak expectng the Rupee to top off the move at 63 itslf. However with the 5th day of rally past ysterday with just minor scratches, today’s close may also be positive and selling 5900 calls are likely to be beaten before day end even though the markets are in an extended short covering phase through this week. IT stocks are nearing fatigue levels, cntriuting to India’s bullishness in ameasured move avoiding days of Rupee depreciation as they target longer term portfolios again, and markets now actually prefer Auto and other performing Economy stocks that are in cycle and not tagged defensives. Before the news of war in Syria died down $151 Bln was already the bill for Indian Oil imports in four months and that turnaround with lower Oil levels could see substantially much more sustainable interest in energy stocks

High CPI and negative IIP reports due today should worry no one as markets resume to wieh in on the fact that Foreign investors will likely keep India in th center of their Global portfolios. No there is virtually no risk of India aplying for sovereign debt default in the coming days.

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