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Events to watch this week

• Central bankers sing more hawkish tune
• US Q1 GDP revised up
• Eurozone economic sentiment soars
• Brazil’s president faces corruption charges
• Venezuelan crisis intensifies

The Week ahead:

For the week,Global equities fell modestly this week amid central bank chatter concerning scaling back monetary stimulus. Yields rose on the talk, with the 10-year Treasury note ending the week at 2.29%, up from 2.15% a week ago. Oil prices recovered some of their recent losses, rising to $45.40 from $42.65 last Friday. Volatility, as measured by the Chicago Board Options Exchange Volatility Index, ticked up to 10.9 from 10.6.

NIFTY- 9,520.90
CRUDE OIL-Rs 2968barrel
GOLD-Rs 28,439gram
Rs/$-Rs 64.57.50

MARKET ROUND UP

Market declined last week amid negative global cues. The Sensex failed to hold the psychological 31,000 level, which it had surpassed during the month. Trading was volatile during the week as the June 2017 derivative contracts expired on Thursday, 29 June 2017. The week was truncated as domestic stock markets was closed on Monday, 26 June 2017, on account of Id-Ul-Fitr (Ramzan Id).

In the week ended Friday, 30 June 2017, the Sensex fell 216.60 points or 0.70% to settle at 30,921.61. The Nifty 50 index fell 54.05 points or 0.56% to settle at 9,520.90.

The S&P BSE Mid-Cap index rose 60.67 points or 0.42% to settle at 14,644.48. The S&P BSE Small-Cap index rose 28.62 points or 0.19% to settle at 15,410.52. Both these indices underperformed the Sensex.

Macro Economic Front:

On the Economic Front,the implementation of landmark tax reform GST will be closely watched. There will be a special function in the Central Hall of Parliament House tonight wherein a number of programs will be witness to the change in tax structure and implementation of GST across the country between the night of June 30 and July 1. The government expects GST to revolutionize India's taxing system and is being marketed as one nation one tax.

Major Action &Announcement:

Axis Bank rose 2.28% to Rs 516.10 after the bank announced after market hours on Wednesday, 28 June 2017, that it successfully issued Rs 3500 crore Basel III compliant additional tier 1 debentures through private placement to augment the tier 1 capital base. The perpetual debentures with a 5 year call are priced at a fine coupon rate of 8.75%.

The board of directors of the bank had yesterday, 28 June 2017, approved the allotment of 35,000 unsecured subordinated perpetual additional tier 1 Basel III compliant non-convertible debentures of the face value of Rs 10 lakh each for cash at par aggregating to Rs 3500 crore, on a private placement basis.

Mahindra & Mahindra (M&M) fell 2.06% to Rs 1,347.65. The company announced incorporating two new subsidiary companies with effect from 25 June 2017. The announcement was made on Monday, 26 June 2017, when the stock markets remained closed on account of holiday.

Mahindra & Mahindra (M&M) said that Mahindra Waste Energy Solutions is incorporated as its new subsidiary company with effect from 25 June 2017. The new company shall carry on the activities connected with renewable energy/non renewable energy. M&M has subscribed to 10,000 shares of Rs 10 each aggregating Rs 1 lakh.

Engineering and contructon major Larsen & Toubro (L&T) fell 2.05% to Rs 1,687.80. L&T said that the transportation, infrastructure and water effluent treatment business has jointly bagged an EPC order worth Rs 1223 crore from Aurangabad Industrial Township. The water and Effluent Treatment Business also won an EPC order worth Rs 1329 crore from the Mumbai Metropolitan Region Development Authority (MMRDA). The announcement was made during market hours on Tuesday, 27 June 2017.

Care major Maruti Suzuki India fell 0.27% to Rs 7217.90. A foreign brokerage house reportedly retained its buy call on Maruti Suzuki India and raised target price on the stock to Rs 8,824 from Rs 7,412 earlier. The stock will continue to trade at premium valuations due to high growth visibility and consistently improving free cash flow due to limited capex requirements, the brokerage house said.

Global Front:

In Overseas Markets,Germany Manufacturing Purchasing Managers Index (PMI) data and UK Manufacturing PMI data for June 2017 will be unveiled on Monday, 3 July 2017.

US ISM Manufacturing PMI data for June 2017 will also be unveiled on Monday, 3 July 2017. US ISM non-manufacturing PMI data for June 2017 will be unveiled on Thursday, 6 July 2017. US ADP nonfarm employment change data for June 2017 will be unveiled on Thursday, 6 July 2017. It measures the monthly change in non-farm, private employment, based on the payroll data of approximately 400,000 US business clients. US nonfarm payrolls data for June 2017 will be unveiled on Friday, 7 July 2017. US unemployment rate data for June 2017 will also be unveiled on Friday, 7 July 2017.

Global Economic News:

Easy money epoch at an end?
Markets turned turbulent this week after a series of hawkish comments from developed-market central bankers suggested the era of ultra-loose monetary policy may be nearing its end. European Central Bank president Mario Draghi’s speech on Tuesday to a gathering of central bankers in Portugal was read as suggesting that the ECB is considering curbing its asset-buying program. The ECB pushed back on that interpretation, but the market refused to be spun. European bond yields rose sharply, as did the euro on foreign exchange markets. Bank of England governor Mark Carney, after saying only a week ago that now is not the time to raise interest rates, reversed course and said the Monetary Policy Committee will debate a rate move in the next few months. Not to be outdone, US Federal Reserve chair Janet Yellen and Vice Chair Stanley Fischer both voiced concerns that equity and other asset valuations are on the rich side, which suggests that financial stability worries could keep the Fed on a tightening path, despite easing US inflation pressures.

Despite the somewhat more hawkish tone, inflation pressures remain extremely muted, except in the United Kingdom, where currency pass-through is boosting prices. To illustrate this point, the eurozone reported on Friday that consumer prices rose only 1.3% in June versus a year ago, down from 1.4% in May. That’s well below the ECB’s near-2% target.

US growth revised higher to start year
US economic growth in the hard-to-measure first quarter of the year was revised higher for a second time on Thursday. Gross domestic product expanded at a 1.4% annual rate, the US Bureau of Economic Analysis reported. That’s up from the 1.2% reading in the last revision. Improved consumer spending was the main driver of the revision, the BEA said. The initial Q1 reading, released in April, was a particularly anemic 0.7%.

Eurozone confidence near a 10-year high
Theeurozone economic sentiment indicator (ESI) jumped to a nearly 10-year high of 111.1 in June from 109.2 in May, with optimism on display in all sectors of the economy, according to a report by the European Commission. The ESI reached 111.8 in August 2007, just before the global financial crisis began to intensify.

GLOBAL CORPORATE NEWS

Temer charged with corruption
Brazilian president Michel Temer was formally charged this week with receiving bribes totaling $152,000. The charges come less than a year after he took office, in the wake of the impeachment of DilmaRousseff. Temer is the first sitting president of the country to be charged with a crime. In addition to the bribery count, the president may also face obstruction of justice charges, according to press reports.

Venezuelan crisis takes bizarre turn
A stolen police helicopter strafed and dropped grenades on Venezuela’s Supreme Court and Interior Ministry headquarters this week as protests against President Nicolas Maduro intensified. Some categorize the attack as an attempted coup against Maduro’s government, while others say the incident was staged by his supporters. The political tumult comes against the backdrop of a deepening economic crisis fueled by runaway inflation, food shortages and falling government revenues stemming from weak oil prices.

NEW 52-WEEK HIGH BSE (A):

NEW 52-WEEK LOWS BSE (A):

MAJOR WEEKLY GAINERS IN BSE A CATEGORY(%):

MAJOR WEEKLY LOSERS IN BSE A CATEGORY:

Eyes will be set on the certain US economic data releases are:

Monday (03July)

PMI Manufaturing Index

Tuesday (04 July)

Market Closed

Wednesday (05 July)

MBA Mortagage Applications&  Factory Orders

Thursday (06 July)

Jobless Claims & PMI Services Index

Friday (07 July)

Natural Gas Report

FundamantelPick of the week:

Accumulate DaburIndia Ltd For Target Rs. 320.00

Investment Rationale

* Dabur India Ltd (DIL) is the second largest FMCG company in India, in terms of Product portfolio. It has a strong portfolio of brands (DaburChyawanprash, Real, Hajmola, Vatika, Amla, Fem, Honey, Meswak, Dabur Red) with the focus largely on ayurvedic& healthcare offerings.The company’s diverse product portfolio (hair care, oral care, skin care, home care, health supplements, digestives, OTC &ethicals) and presence in niche categories has aided revenue growth at a robust ~12% CAGR in FY10-17.

* After retesting lower band of its consolidation range in May 2017, it has rebounded swiftly in last one month and now reached closer to the breakout area. The prolong consolidation phase combined with indications from the chart pattern is pointing towards possibility of strong surge in near future. Thus we advise traders to accumulate in the given range of 290-293 with close below stop loss of 276 for the target of 320

Recommendation

Accumulate Dabur India Ltd @ 290-293 Stoploss 276 Target 320

MARKET OUTLOOK:

The NIFTY balance is clearly favoring the BEARS, while the EXPIRY compulsions pointed to a temporary BOUNCE-BACK. On the daily chart, Index broke its last two weeks low @ 9560 and has formed a real black body candle over the week. In addition, momentum oscillator i.e. RSI has broken 50 levels for the first time this year. All in all, Index is expected to stay under pressure and could lead to retest 9450 levels which is a confluence zone formed by (i) 50DMA, (ii) Rising trend line and (iii) 61.8 retracement level of near-term rise (9341 - 9709). A clear break below 9450 level would indicate that Index has moved into medium term bearish phase (with an immediate downside of 9280 levels).On the flip side, previous support zone around 9560 will now act as a resistance zone, as is clearly demarcated in the EXPIRY supply zone. 

Other technical observations

In continuation to its sideways trend, the domestic benchmark index, Nifty slipped nearly half percent amid volatility.Participants are focusing on GST roll out and will react to the cues next week. Besides, indications from the global front, movement on currency front and further monsoon update will dictate the market trend.

* Technically, Nifty has crucial support at 9400 and any breakdown will trigger further selling pressure ahead. Having said that, the overall trend is still positive and we advise investors to utilise this corrective phase to accumulate quality index majors.

* Broadly , we expect Nifty to trade in a range of 9300-9700 in the up coming week.

Conclusion:

The Indian equity market extended its losing streak to the third consecutive week as traders and investors continued to trade cautiously ahead of the GST rollout. Outflows by foreign funds and weak global cues further added to concerns. CDSL saw a bumper debut and closed near 75% higher on the street while AU Small Finance Bank IPO was oversubscribed by over 50x times. Eris Lifesciences got listed 2% over issue price on the bourses this week, however, it closed slightly lower. Tejas Networks witnessed a tepid listing; however, the stock picked up momentum as the week progressed. Rashtriya Chemicals & Fertilizers’ (RCF) offer-for-sale was subscribed 791%. Monsoon has touched majority of Indian subcontinent and is just 1% below estimates. Government of India has in principle given an approval for sale of Air India.

Overall, volatility ruled the roost throughout the week on account of a historic F&O expiry which saw highest turnover ever. Banking stocks remained in focus following reports of an RBI order seeking hefty provisions for accounts referred to bankruptcy courts.

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The most significant tax reform for India will likely have its fair share of glitches post implementation. Agility on part of businesses and governments will be needed to navigate through the initial phases of uncertainty. The economy stands to gain over the long term as efficiency gains and higher government revenues translate into higher growth potential. Job creation will remain a concern as the unorganized sector shifts towards the organized sector.

The Goods and ServicesTax (GST) is a destination-based indirect tax that will subsume all current indirect taxes being levied—both by center and the states—except basic customs duties and a few state and local taxes.The new taxation system under GST is aimed at making a simplified indirect taxation regime which has pan-Indiauniformity thereby removing inefficiencies arising from taxing the same good multiple times at different rates across each state.

The GST aims to remove the cascading effect of various central and state levies. Alcohol for human consumptionand electricity are outside the purview of GST while levy on petroleum products (crude, diesel, petrol, natural gas,and ATF)will be recommended by the GST Council at a later data.

GST Council: Apex body for decision making

GST council is the top constitutional authority for GST, which is created to mirror the federal structure of the country, with the Union FinanceMinister as the Chairperson, a minister from a state government as the Vice-hairperson and all state finance ministers and the Union Minister of State (Finance)as members. The States have 2/3 weightage while the centerhas 1/3 weightage. Any decision needs support of at least 75% of the councilwith a quorum of 50%. It is the prime decision making body for GST with the power to make recommendations on rulesand laws, rates, exemptions and thresholds, etc.

Neutral to negative impact as uncertainty-led risks high in the short term

The short-term impact of GST could be neutral to negative for the broader economy. Production processes will likely take some time to align with the new framework as firms adjust to the input tax credit system and get a handle on the working capital requirements too. Micro and small enterprises could see costs increase due to higher compliance and a shift towards the organized sector. We would be cautious on economic growth for next one to two quarters. The GST rate structure will be neutral to marginally disinflationary for CPI inflation We estimate CPI inflation to be lower by around 20 bps on an average due to GST rates.

Positive implications likely in the medium to long term

The economic benefits in the medium to long term would be from two major factors: (1) efficiency gains from a simpler tax system, more productive business operations, and creation of a one nation market for production and consumption, and (2) higher government revenues due to expansion of the tax base as compliance increases and unorganized segment shifts to the organized segment. However, we note that unorganized sector employs a majority of the labor force. With the unorganized sector shifting to the organized sector, a significant labor absorption capacity that currently exists may get eroded. This can compound the already chronic problem of job creation in India. Given India’s economic structure and GST framework, drawing quantitative conclusions from other countries’ experiences would be unfounded.

Post-implementation challenges: proof of the pudding is in the eating

Challenges will be more evident after the implementation, but it is important to recognize a few issues which may crop up. The primary concern will be glitches in seamless tax credit which can have a negative effect on the working capital requirements of the firms. Further, the industry could have concerns on the limited number of GST Service Providers (GSPs) presently approved and the reliability of the linkage between the firms and Application Service Providers (ASPs) in terms of security and network (Exhibit 4). Some concerns will also be on the ability of micro and small retailers to be able to submit online returns which the GST regime mandates to be done on a monthly, quarterly and annual basis (Exhibit 5).

Companies’ challenges: short-term hitches will be the focus for now

Exhibit 6 summarizes the key changes and our understanding of the issues and challenges of the sectors. Most challenges now revolve around compliance, infrastructure, and logistics of the GST system which would essentially demand an on-the-go course correction, if any. Over the next few quarters as the dust settles on short-term glitches, the business will move to resolve the more structural issues of reforming business models and gaining efficiency.

Rate structure: Dual control and multiple rates

The current GST rate structure is a combination of both central and state government having

a share in the tax collections. There are three types of taxes—Central GST and State GST for

intra-state transactions and IGST (Integrated GST) for inter-state transactions.

The GST Council has decided the tax rates while trying to keep the rates closer to present effective rates for most commodities and services. Tax rates in GST will be kept under four specific slabs—5%, 12%, 18% and 28%—while certain basic goods and important services are exempt from GST. Luxury and sin goods, as identified, will attract additional cess over the peak rate of 28%. Precious and semi-precious stones and precious metals  would attract a GST rate of 3% while rough diamond would have a GST rate of 0.25%.The cess will be used to compensate states for any revenue loss incurred due to GST implementation for five years after implementation. The loss is to be calculated with FY2016 as the base year and an annual growth of14% over the period of compensation. summarizes the relevant tax base growth rateover the last few years across various states.

GST will apply to businesses having a turnover exceeding `2 mn(`1 mn for special category

states). In effect it would be a relief for certain traders and service providers which had a

threshold of `0.5 mn in most states’ VAT and `1 mn for service tax. However, for manufacturing units this would be a reduction in the threshold limit as they enjoyed central

excise duty exemption till `15 mn of turnover. As decided by the GST Council, states would

have administrative control over 90% of tax payers having a turnover below 15 mn and

center would have administrative control over the remaining 10%. Taxpayers above this

threshold would be divided equally between central and state tax administrations. 

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Events to watch this week

• Crude oil prices decline more than 20% from recent peaks

• Brexit negotiations begin

• BOE governor, economist split over rate moves

• MSCI admits China’s A shares

• Fed’s Powell OK with relaxing Volcker rule

The Week ahead:

For the week,Global equities slipped this week, but not before the S&P 500 Index posted a fresh record high early in the week. Falling oil prices have been a cause for investor concern. West Texas Intermediate crude continued its decline, slipping to $42.65 a barrel on Friday from $44.70 a week ago, trading near a seven-month low. The yield on the US 10-year Treasury note was virtually unchanged, while volatility, as measured by the Chicago Board Options Exchange Volatility Index (VIX), declined slightly to 10.6 from last Friday’s 10.9.

NIFTY- 9,574.95
CRUDE OIL-Rs 2781barrel
GOLD-Rs 28,753gram
Rs/$-Rs 64.52

MARKET ROUND UP 
A divergent trend was witnessed as the barometer index, the S&P BSE Sensex, settled with modest gains while the Nifty 50 index registered small decline in the week ended Friday, 23 June 2017. The BSE Mid-Cap and the S&P BSE Small-Cap indices underperformed the Sensex during the week. Trading activity was quiet during the week in absence of major triggers. 
In the week ended Friday, 23 June 2017, the Sensex rose 81.81 points or 0.26% to settle at 31,138.21. The Nifty 50 index fell 13.10 points or 0.14% to settle at 9,574.95. The S&P BSE Mid-Cap index fell 223.52 points or 1.51% to settle at 14,583.81. The S&P BSE Small-Cap index fell 285.34 points or 1.82% to settle at 15,381.90. Both these indices underperformed the Sensex. 
Key benchmark indices logged strong gains on first trading day of the week on Monday, 19 June 2017 on upbeat global markets. The Sensex gained 255.17 points or 0.82% to setle at 31,311.57, a record closing high for the index. Amid a divergent trend among various index constituents, the key benchmark indices finished a shade lower in a quiet session of trade on Tuesday, 20 June 2017. The Sensex fell 14.04 points or 0.04% to settle at 31,297.53, its lowest closing level since 16 June 2017. 

Macro Economic Front: 
On the Economic Front,Developments related to roll-out of Goods and Service Tax (GST), progress of monsoon rains, domestic and global macroeconomic data, trend in global markets, investment by foreign portfolio investors (FPIs) and domestic institutional investors (DIIs), the movement of rupee against the dollar and crude oil price movement will dictate trend on the bourses in truncated trading week ahead. Domestic stock markets will remain closed on Monday, 26 June 2017 on account of Id-Ul-Fitr (Ramzan Id). 

The market may remain volatile as traders roll over positions in the futures & options (F&O) segment from the near month June 2017 series to July 2017 series. The near month June 2017 derivatives contract expire on Thursday, 29 June 2017. 
The progress of monsoon rains will be closely watched. The IMD said that for the country as a whole, cumulative rainfall during this year's monsoon upto 22 June has been 4% above the Long Period Average (LPA). The June-September southwest monsoon is critical for the country's agriculture because a considerable part of the country's farmland is dependent on the rains for irrigation. 

Major Action &Announcement:
Axis Bank fell 1.06%. The bank has revised Marginal Cost of Funds based Lending Rate (MCLR) rates in the short tenors. The 1 year MCLR stands unchanged at 8.25%. New rates are effective from 17 June 2017. The announcement was made after market hours on Friday, 16 June 2017. 

ICICI Bank lost 7.9%. The company announced that the Committee of Executive Directors of the Bank at its meeting held on 20 June 2017 has approved the proposal for fund raising by way of issuance of senior unsecured long term bonds in the nature of debentures in single/multiple tranches on private placement basis. 

Index heavyweight and housing finance major HDFC advanced 0.72%. The company filed term sheet for issuing secured redeemable non-convertible debentures worth Rs 700 crore on private placement basis. HDFC said that the coupon rate on debentures is 7.21% per annum. The tenor of the debentures is one year 93 days, with redemption date being 24 September 2018. The announcement was made after market hours on 21 June 2017. 

Tata Motors lost 2.72%. As per reports the Tata Group may be considering listing its luxury carmaker Jaguar Land Rover through an initial public offer. According to reports, senior executives of Tata Group have held preliminary internal discussions over listing of the British luxury automobile company Jaguar Land Rover (JLR) over an international stock exchange, which may potentially include New York Stock Exchange or London Stock Exchange. Tata Motors had bought an ailing JLR in a surprise move in 2008 for $2.4 billion from Ford Motor Co. 

Adani Ports and Special Economic Zone (APSEZ) rose 1.35%. The company said Moody's has changed its outlook on the company to stable from negative. Moody's has re-affirmed its investment grade rating at Baa3 on APSEZ. The announcement was made during market hours on 19 June 2017. 

Drug major Lupin lost 6.2%. Media reports suggested that Lupin'sPithampur Unit 3 has been issued 5 observations by the US Food and Drug Administration (USFDA). Meanwhile, Lupin announced during market hours on 22 June 2017, the launch of its Desoximetasone Cream USP, 0.05% and Desoximetasone Cream USP, 0.25% having received an approval from the United States Food and Drug Administration (FDA) earlier. 

Global Front: 
In Overseas Markets,growth in the eurozone's manufacturing and services sector slowed in June, data showed on Friday, 23 June 2017. Markit's flash eurozone PMI composite output index came in at 55.7 in June, a five-month low. 
A report on weekly jobless claims showed that fewer than 250,000 Americans applied for unemployment benefits in mid-June. Initial jobless claims rose by 3,000 to 241,000 in the seven days stretching from 11 June to 17 June 2017, Labor Department said on Thursday, 22 June 2017. 

Global Economic News:

Crude oil prices deepen slump
The price of a barrel of West Texas Intermediate crude oil extended its decline this week amid rising global inventories. WTI prices have fallen in excess of 25% from their $58.30 high, which was posted on the year’s first trading day. Energy company shares have been under pressure, while spreads in the sector’s high-yield bond market have widened over benchmark Treasury yields this week. The sharp decline in energy prices will make it that much more difficult for the US Federal Reserve to reach its 2% inflation target in the foreseeable future.

Brexit talks underway
Negotiators from the United Kingdom and the European Union met on Monday in the first formal Brexit negotiating session. The one breakthrough from the talks was the UK’s acquiescence to EU demands that the divorce bill must be settled before the EU begins to negotiate a new trade arrangement. Late in the week, Prime Minister Theresa May met with EU leaders in Brussels and laid out her plan to protect the rights of the three million EU citizens living in the UK, allowing them permanent residence. May called on leaders to grant British citizens living in the EU the same rights.

To hike or not to hike?
That is the question on the minds of the members of the Bank of England’s Monetary Policy Committee. While UK growth has suffered a downturn of late, inflation has surged on the heels of a tumble in the pound’s exchange rate. Rising import prices have pushed consumer prices up 2.9% versus year-ago levels, prompting three members of the short-staffed MPC to vote for a rate hike last week against five votes to leave policy unchanged. The divide deepened this week as the Bank’s two most high-profile officials came out on opposite ends of the question of whether rates should be raised this year. BOE governor Mark Carney made the case that now is not the time for rate hikes given low wage growth and mixed signals on consumer spending and business investment. BOE chief economist Andy Haldane countered that it would be prudent to raise rates in the second half of this year to counter the inflation surge. 

China gets nod from MSCI
After years of fighting for inclusion in MSCI’s influential stock indices, China finally received word that some of its A shares will be included in the indices in mid-2018. Just fewer than half of the 448 A shares will be included in the indices and at an initial weighting of just 5% of each stock’s market cap. These restrictions are an effort by MSCI to incentive China to further liberalize its stocks markets.

US banks clear first round of stress tests
Thirty-four big US banks passed the first round of the Fed’s stress test this week. Next week, the central bank will announce whether it will allow the banks to return capital to shareholders. Some banks may begin to reduce their capital if the Fed approves. That could be seen by markets as a sign of confidence that the banking system is strong and positioned well to withstand a significant economic downturn.

GLOBAL CORPORATE NEWS

Room to relax
Fed governor Jerome Powell told a congressional committee that US regulators have room to relax or eliminate some aspects of the Volcker rule, which is intended to limit banks’ ability to make speculative bets with insured deposits. Regulators are looking for ways to simplify the complicated rule and may exempt small banks from having to comply, Powell said.

Treasury secretary rejects one-off ultra-long bond
US treasury secretary Steven Mnuchin this spring floated the idea that the United States is considering issuing very-long-dated bonds. This week he said the government will only issue ultra-long maturity Treasuries if there is sustained appetite for the securities. Mnuchin said his department is reaching out to investors in order to gauge demand for instruments with maturities between 50 and 100 years, but any move to issue very-long-term debt would not be a one-off. Apparently there is at least some investor demand for long paper, as Argentina issued 100-year bonds this week despite having defaulted six times in the last century. The issue, although rated below investment-grade, was heavily oversubscribed.

NEW 52-WEEK HIGH BSE (A):

NEW 52-WEEK LOWS BSE (A):

MAJOR WEEKLY GAINERS IN BSE A CATEGORY(%):

MAJOR WEEKLY LOSERS IN BSE A CATEGORY:

Eyes will be set on the certain US economic data releases are: 
Monday (26June)
Durable Goods Orders 
Tuesday (27 June)
Consumer confidence 
Wednesday (28 June)
MBA Mortagage Applications
Thursday (29 June)
Jobless Claims 
Friday (30 June)
Consumer Sentiments

Technically Pick of the week:

Accumulate ITC Ltd For Target Rs.363.00

* ITC Closed 0.7% up in trade today at Rs311 compared to flat close in benchmark Nifty.
* We expect ITC to benefit in GST regime as tax outgo is similar to the current tax structure. It also provides more clarity and uniformity in taxes across states.
* Increase salience of DSFT cigarettes and strong pricing power would aid growth in volumes and profitability in the coming quarters.

* We expect ITC to post revenues and net profit of Rs449.4bn and Rs118.2bn respectively in FY18.Based on expected EPS of Rs9.7, the stock currently trades at an attractive P/E multiple of 32x FY18E earnings, which is at a 20% discount to sector multiples.

* We maintain BUY rating on the stock with target price of Rs363.

MARKET OUTLOOK: 
Markets to make a cautious start on mixed global cues 
The Indian markets gave up all their gains in final hours to end flat with just a positive bias in last session, tracking weak cues from European markets. Today, the start is likely to remain cautious tailing mixed global cues. Markets however, may get some support with Reserve Bank Governor Urjit Patel’s statement that he is not 'overly pessimistic' about employment scenario in the IT sector, pointing out that mushrooming startups can compensate for job losses. Meanwhile, the Union Cabinet passed a resolution expressing gratitude to Chief Ministers of States and others for their cooperation in introduction of GST, calling it the biggest tax reform in independent India.

The banking stocks will be in focus with credit rating agency ICRA stating that asset quality pain for banks is expected to continue in financial year 2018 due to restructuring by banks, weakness in some large corporate accounts and moves like waiver of farm loans.  On the same time IT stocks may come under pressure as Industry body Nasscom has projected that India's IT industry is expected to grow at the slowest pace in nearly a decade as clients defer spending in the face of geopolitical uncertainties. Software export growth in financial year 2017-18 is projected at 7-8 per cent in constant currency terms, down from 8.6 per cent last year.

Other technical observations 
Low made friday was 9608 so even though bulls were not able to break the gann angle but they held on to support of 9610 in today’s fall and closed at 9633, Now bulls need a close above 9650 for a quick move towards 9720/9770. Bearish below 9610 for a move towards 9565/9520. Nifty made high of 9698 today unable to make a new life high above 9709 and made low of 9630, so bulls protected 9610 and bears protected 9720 hence trading in neutral zone with high volatility experience during the day.Today is 3 day where we made the failed attempt to close above gannangles, bulls should not delay much else bears will become active and can push nifty lower towards 9500/9400 odd levels. Now bulls need a close above 9650 for a quick move towards 9720/9770. Bearish below 9610 for a move towards 9565/9520. 

Conclusion: 
Fresh farm loan waiver by the Karnataka government, escalating NPA issues and problems faced by the IT industry on the H1B visa front are among the multiple headwinds that have dragged Nifty over 100 points in the past two days.
On the other hand, banking stocks were in action after RBI announced plan to resolve troubled assets of 12 large borrowers and has also asked banks to resolve 55 high value cases of bad loans within six months. For the week, BSE Sensex and Nifty ended with marginal losses.

The IPO market is seeing very healthy signs with the IPO of CDSL receiving an overwhelming response as it got oversubscribed 169 times.