Market Fundamentals
Global Equity Review
Most Asian stocks rose on Tuesday, with positive cues from Wall Street and the prospects of more stimuli in China underpinning investor sentiment. Oil prices regained some ground in Asian deals but traders fear oversupply will continue to undercut prices for months to come.
The European markets ended Tuesday's session with mixed results. The gains and losses in Europe were rather modest, due to the light trading action. The approaching holiday season has many investors away from their desks. Energy and resource stocks were among the best performing stocks.
US stocks moved mostly higher over the course of the trading day on Tuesday, adding to the gains posted in the previous session. With the upward move on the day, the major averages further offset the sharp pullback seen late last week.
Crude oil prices inched higher Tuesday, staying away from multi-year lows as U.S. oil briefly traded at parity with Brent crude. Nymex February oil futures ended 33 cents higher at USD 36.14 a barrel. London's Brent slipped to the lowest in 11 years before rebounding a bit, while U.S. WTI crude oil steadied near its lowest since 2009.
India Market Review
Indian shares fell on Tuesday despite positive cues from global markets. Losses for metal stocks and index heavyweights ITC and Infosys pulled key market indices lower.
Among the prominent decliners, SBI, Hero MotoCorp, Mahindra & Mahindra, and ITC lost c.1-2%. IT stocks such as TCS and Infosys also fell c.1-2%, a day after the U.S. doubled H-1B visa fee.
Market News
India's current account deficit (CAD) narrowed to USD 8.2bn (1.6% of GDP) in the September 2015 quarter from USD 10.9bn (2.2% of GDP) in the year-ago quarter. However, CAD was up on a sequential basis from USD 6.2bn (1.2% of GDP) in the June 2015 quarter. Balance of Payments (BoP) was in the negative territory as there was a small drawdown of USD 900mn from reserves in the September quarter. In contrast, there was accretion of USD 6.9bn in 2014 September quarter.
Reliance Communications on Tuesday said it had entered into a 90-day non-binding exclusivity period with Maxis Communications Berhad and Sindya Securities and Investments, shareholders of Aircel, to consider potential combination of their Indian wireless business. Reliance Communications could, after the two mergers, become the country's second-largest telecom company by subscribers after Bharti Airtel.
The Chhattisgarh government has cancelled a no objection certificate (NoC) to UltraTech Cement for a limestone mine in Raipur district. has come under the scanner as the state government on Tuesday announced to cancel the granted to the company required to commission the operation.
Market Outlook
Markets expected to open on a positive note following firm global cues. Technically intraday supports are 7680 and 7600 and resistances are 7850 and 7900.
Kindly find attached India Morning Memo & Derivative Watch for 23 December 2015
Investment Strategy
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