Indian Indices Continue Momentum, Oil Dips on Demand Worries, and Top Stocks in Action Today

Wed, 3 Jul Pre-Open | Monish Vora, TM Team

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On Tuesday, Indian share markets witnessed buying interest during closing hours and ended marginally higher.

The BSE Sensex closed higher by 130 points to end the day at 39,816. HDFC and Infosys were among the top gainers.

While the broader NSE Nifty ended up by 45 points to end at 11,910.

Among BSE sectoral indices, oil & gas stocks gained the most by 1.1%, followed by IT stocks and power stocks.

Top Stocks in Action Today

ONGC share price will be in focus today after the company and Indian Oil Corporation joined hands to reduce carbon emission and enhance oil recovery.

Bharat Heavy Electricals share price will also be in focus today as the company said competent authority has approved the appointment of Dr Nalin Shinghal as Chairman & Managing Director (CMD) of the company for a period of 5 years.

Market participants will also track Alembic Pharma share price.

Reportedly, the company has received approval from the US health regulator for Febuxostat tablets, used to lower high levels of uric acid in adults who have gout. The approved product is therapeutically equivalent to the reference listed drug Uloric tablets of Takeda Pharmaceuticals USA, Inc.

DHFL Crisis

In the news from the finance sector, Dewan Housing Finance Corporation (DHFL) has agreed to sign an inter-creditor agreement (ICA) on July 5 and is considering a resolution plan for the beleaguered firm.

Bankers to DHFL met on Monday and agreed in principle to sign an ICA which is mandatory for any revival plan according to the new framework for restructuring of stressed loans which came into effect from June 7.

Last week, the company received market regulator's approval to exit its mutual fund business by selling its 50% stake to Prudential Financial.

The company had entered an agreement with Prudential Financial to divest its 50% holding in DHFL Pramerica Asset Managers (DPAMPL). Of this 17.12% is held directly and 32.88% is held by its wholly-owned subsidiary, DHFL Advisory & Investments.

It was reported last week that the mortgage lender is yet to repay Rs 2.3 billion out of the total Rs 3.8 billion of commercial paper to a dozen investors.

How this all pans out remains to be seen. Meanwhile, we will keep you updated on the latest developments from this space.

Gold Imports Rise Amid Global Price Rally

India's gold imports rose 12.6% in June from a year earlier to US$ 2.7 billion amid a jump in global prices to six-year highs. In India, local prices jumped to a record high in June, moderating demand from retail consumers.

However, imports were 44% lower in June from May's US$ 4.8 billion.

Vijay Bhambwani, in his recent article has explained why gold prices are on the rise and how it's not a cause for cheer.

Here's a snippet from the article:

• Gold is the cave investors hide in, when the mind is overwhelmed with fear and alternate investment ideas run out.
  
  The Indian investor in gold is a breed apart. He must contend with the local currency peg as well. It's a well-known fact that the INR has a history of depreciating between 3.5% to 5% per annum on a long period average (LPA) basis. Every time the INR falls versus the Dollar, gold rises on currency considerations alone. This is why gold is off its peak in Dollar terms but it's near lifetime highs in INR. Any further depreciation and gold rises.

To know more, you can read his full article: Gold Is Rising. Should You Be Happy?

From the Commodity Space...

Oil prices slipped on Tuesday as concerns that the global economy could be slowing outweighed an agreement by producer club OPEC on Monday to extend supply cuts until next March.

The Organization of the Petroleum Exporting Countries agreed on Monday to extend oil supply cuts until March 2020 as members overcame their differences to try to prop up the price of crude.

Russian President Vladimir Putin said on Saturday he had agreed with Saudi Arabia to extend global output cuts until December 2019 or March 2020, and Saudi Energy Minister Khalid al-Falih said on Tuesday he was 100% confident of an OPEC+ deal.

Meanwhile, US crude oil stockpiles were seen falling for a third consecutive week. While the US and China agreed at a recent group of 20 leaders summit to restart trade talks, factory activity shrank across much of Europe and Asia in June while growth in manufacturing cooled in the United States weighed on oil prices.

Stay tuned for more updates from this space.

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