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FMCG Stocks Outlook for the week - 02 to 06.02.2015
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( www.rupeedesk.in )
The consolidation in equities is expected to continue next week and the underlying sentiment is
slightly weak after major banks reported disappointing earnings. Corporate earnings and Reserve
Bank of India's monetary policy are the key events to be watched.
The RBI's sixth bi-monthly monetary policy, to be released on Tuesday, however, may largely
turn out to be a non-event, as the central bank is widely expected to keep rates unchanged after
the surprise 25-basis-point cut announced earlier this month. Most expect the RBI to take the
next rate cut only after the Union Budget. Therefore, earnings will take centre stage.
However, some traders see yesterday's fall as the start of a correction before the pre-budget rally
actually begins. Bank stocks, which fell sharply yesterday, are expected to fall further next week,
which will also weigh on benchmark indices. Banking stocks, which had run up quite a bit since
the last two weeks will be trading with a downward bias in the next week.
While banks are expected to trade weak, information technology stocks are seen doing well,
which may provide some downside support to the market.
Stock of Coal India, whose offer for sale received an overwhelming response may face further
selling pressure on Monday, but the downside is seen limited and the correction in the stock as a
buying opportunity. Automobile stocks will be in focus on Monday as companies will release
their monthly sales data on Sunday.
Index majors such as Bharti Airtel, Tata Motors, Tata Steel, Tata Power, ACC, Punjab National
Bank, Lupin, GAIL (India), and Hero MotoCorp will release their quarterly earnings next week.
Grasim Industries will report its earnings on Saturday (Today).
Among others, Tech Mahindra is expected to rise on Monday as the company posted higher than expected net profit for Oct-Dec, and also announced 1-for-1 bonus issue and 2-for-1 stock split.
( www.rupeedesk.in )