- Wealth PMS (50L+)
The Slack group at Capital Mind Premium has been extremely active and if you haven’t been there, pop us a note by replying to this email. (If you’re a trial member this probably sound like Greek to you; it will be available when you sign up!)
A brief summary of some of the interesting things discussed there in the last few days:
Pharma major Strides Shasun Ltd has doubled its outlay for potential compensation of $200 million (Rs 1,300 crore) after US Pharma major Mylan, which bought the Indian firm’s unit Agila Specialities in 2013, raised red flag over regulatory concerns over its factories and the deal agreement. Strides also said it is evaluating each claim made by Mylan.
Mylan bought Agila Specialities, a drug firm with factories in Karnataka for $1.75 billion in 2013. This is one of the major pharmaceutical deals in the country. In August, the US Food and Drug Administration (USFDA) had warned Mylan of not complying with current good manufacturing practice (CGMP) in three factories, including two that it bought from Strides. (Link)
European car sales rose 13.7 percent in November — its sharpest spike since June — according to industry data released Tuesday. U.S. automobile brands in Europe registered strong gains as German carmaker Volkswagen continued to suffer due to subdued demand after the diesel emissions test-rigging scandal.
Registrations for new cars in November rose to 1.12 million from 989,758 cars the month before, marking the strongest increase since June when new-car sales rose 14.6 percent, the European Automobile Manufacturers’ Association data showed. (Link)
How does this work?
In IRF derivative contracts, a trader will go ‘long’ (buy) when he expects the price of the underlying bonds to rise; in other words, when rates will soften. Similarly, he would go ‘short’ (sell), when according to his analysis, interest could harden, or rise.
Unlike spot government securities market, an investor here needn’t invest full amount for entire exposure, but a margin money, which varies from 2-3%. (Link)
After Tata Consultancy Services (TCS), Wipro too has issued a warning saying that disruption at its Chennai facilities due to recent floods and the costs associated with subsequent invocation of business continuity plans would have a material impact on the performance of the company in the October-December quarter of FY16.
Wipro’s warning comes on the heels of a similar announcement by India’s largest IT services firm Tata Consultancy Services. (Link)
Finance Minister Arun Jaitley on Wednesday explained the rationale for not passing the full benefits of the slump in global crude oil prices to domestic consumers. The drop in domestic fuel prices has not kept pace with the slump in global Brent crude oil, which is trading at an 11-year low below $40 per barrel.
Despite multiple price cuts, petrol and diesel prices have remained relatively high because of a series of excise duty hikes imposed by the government. (Link)
The debt-ridden Nagpur Municipal Corporation (NMC) has miserably failed to improve city bus service despite having 470 buses purchased from JNNURM funds. However, it is now planning to procure 55 very expensive ethanol-run buses at its own cost, even though it claims to be without cash to even repair potholes on roads. The only entity that will benefit from this proposal is a private bus manufacturer, which will most probably be Swedish-bus maker Scania Commercial Vehicles India Private Limited, that had launched the nation’s maiden ethanol-run bus in the city. (Link)
Assuring the GST rate to be less than 18 per cent, Finance Minister Arun Jaitley today hinted at accepting Congress’ stand on scrapping one per cent additional tax, but said their demand to incorporate the rate in the Constitutional Bill is not agreeable. (Link)
“The City of Flint has experienced a Manmade disaster,” said the city’s mayor Mondayevening, as she declared a state of emergency over evidently staggering levels of lead in the city’s tap water. Mayor Karen M. Weaver has requested federal assistance to deal with the fallout from over a year’s worth of tainted water delivered to Flint residents and, allegedly, falsely declared safe by government official
s. (Link1) (Link2) (Link3)
Despite an increase in prices and virtually no discounts, Piramal Realty’s first realty project—Piramal Vaikunth in Balkum, Thane, Mumbai—appears to have attracted a good response. FE has learnt that there’s just one apartment left of the smaller types—priced at Rs 1 crore for 515 sq ft—in the first of the 23-storey tower. (Link)
Top global funds including Franklin Templeton, Aberdeen, Morgan Stanley, Goldman Sachs and Matthews Pacific Tiger Fund have emerged as the largest sellers in India’s equity markets in 2015.
Market experts say top foreign institutional investors were reeling under the pressure from withdrawal by petro-dollar led sovereign wealth funds that have forced huge sell-off in equity markets around the world. (Link)
The finance minister said the standard tax rate would be below 18% under the proposed GST. Ruling out specifying the GST rate in the Constitution Amendment Bill, he said the rate for commodities used by the poorer sections would be lower than the standard rate, while luxury and “sin” products would attract an even higher tax. (Link)
The United States appears on the brink of ending a four-decade ban on most exports of crude oil, which would end a years-long fight brought about by a boom in domestic shale output that contributed to a supply glut and depressed prices.
The measure is part of a sprawling deal wrapped up by congressional leaders late on Tuesdayto keep the U.S. government open through September. The $1.15 trillion spending bill, negotiated in secret talks over the last two weeks, would be difficult for President Barack Obama to veto despite his opposition to ending the oil export ban. (Link)
The study ranks Bangalore, Mumbai and New Delhi at 12th, 13th and 16th positions for investment prospects and at 15th, 13th and 11th positions for development prospects respectively, in the list of the 22 markets covered in the report. While there has been a marginal drop in rankings of Mumbai and New Delhi from an investment prospects perspective against 11th and 14th rank, respectively in 2015, Bangalore has shown a remarkable improvement moving up 5 positions over its last year’s ranking of 17. (Link)
Car owners in Mumbai, New Delhi, Chennai and Kolkata may have to pay 15% higher premium than their cousins in other parts of the country as insurance companies believe the risk of insuring cars in big metros are higher after Chennai floods saw more than Rs 1,500 crore worth of claims.
“We will have to build in the factor of flood for all big cities that are developing fast and premium should go up by 10%-15%,” said Vijay Kumar, head of motor insurance Bajaj Allianz General Insurance. (Link)
Stocks are set up for a ‘Santa Claus’ rally to all-time highs by the end of 2015
That’s the bullish call from Raymond James’ Jeffrey Saut, as stocks rally for a second day in a row, and the S&P 500 crawls out of negative year-to-date territory. (Link)
Jet Airways has announced the resignation of its Chief Executive Officer (CEO) Cramer Ball with effective from February 29, 2016, to pursue a new opportunity in Europe for family reasons. Gaurang Shetty, whole-time director will become the acting CEO, the company said in a statement. (Link)
A judge in Sao Paulo has ordered WhatsApp to shut down for 48 hours, starting at 9pmEastern tonight.
Brazilian telco’s have been lobbying for months to convince the government that WhatsApp’s voice service is unregulated and illegal (not entirely unlike the taxi industry’s posture on Uber), and have publicly blamed the “WhatsApp effect” for driving millions of Brazilians to abandon their cell phone lines. (Link)
Martin Shkreli was arrested by the FBI on charges of securities-fraud on Thursday morning.
Shkreli, the 32-year-old CEO of KaloBios, gained notoriety in September after it was revealed that as CEO of another company, Turing Pharmaceuticals, he had raised the price of a drug used to treat parasitic infections from $13.50 to $750 per pill. (Link)
While the industry was prepared for the fee to be reinstated, nobody expected it to double. “The pre-September assessment was that the impact was of the order of a $100 million. This could potentially quadruple because it is doubling of the quantum and expansion of the scope,” R Chandrashekhar, president of the National Association of Software and Service Companies, told ET. (Link)
Betting big on the hatchback crossover (or micro SUV) space, Mahindra & Mahindra on Friday unveiled the official rendering of the KUV100. The sub-4m crossover’s nomenclature stands for ‘Kool Utility Vehicle’, and will be available in four variants: K2, K4, K6 and K8. (Link)
4 Practical Day Trading Tips For The Price Action Trader – (Link)
9 Professional Insights on Drawing Support and Resistance Levels like a Pro – (Link)
Implied Volatility: Buy Low and Sell High – (Link)
Indicators work. But you just don’t know how to use them – (Link)
Nifty – Bearish Formation – (Link)
Using Trading Indicators Effectively – (Link)
What’s In Your Price Action Trading Toolbox? 5 Skills All Price Action Traders Must Have – (Link)
Nothing in this newsletter is financial advice and should not be construed as such. Please do not take trading decisions based solely on the matter above; if you do, it is entirely at your own risk without any liability to Capital Mind. This is educational or informational matter only, and is provided as an opinion.
Disclosure: The authors at Capital Mind have positions in the market and some of them may support or contradict the material given above, or may involve a direction derived from independent analysis.