US economy expanded an annualized 2.9% in the third quarter of 2016, more than 1.4% in the previous quarter. It is the strongest growth rate since Q3 2014, as inventories recovered and exports grew the most in nearly three years while personal consumption slowed.
UK economy slowed in the first three months after the UK voted to leave EU. From June 2016 to September 2016 growth slowed down to 0.5%, down from 0.7% in the April 2016 to June 2016 quarter. The economy was mainly boosted by a strong performance from service sector, which grew by 0.8% (Q-o-Q). Bank of England policymakers expected a growth of 0.1% (Q-o-Q), but the figures beat the expectations of the policymakers.
Canada recorded a government budget deficit of CAD 2.7 billion in August 2016, compared to a deficit of CAD 2.3 billion the same month of the previous year. Revenues increased by CAD 0.7 billion, or 3.2% (Y-o-Y), boosted by increases in corporate income tax revenues, excise taxes and duties and other revenues, while program expenses increased by 6.1% (Y-o-Y).
Hong Kong’s trade deficit rose by 9.1% (Y-o-Y) to HKD 39.7 billion in September 2016. Exports went up by 3.6% and imports rose at a faster rate 4.1%. Hangseng index fell by 1.80% in the last week.
The number of oil rigs operating in U.S. oil fields dropped for the first time since June, oil rig count fell by 2 to 441 rigs. Prices of crude oil rose as much as 13% after 27th September 2016, when OPEC announced its first planned output reduction in eight years. The cartel is expected to meet on 30th November 2016 to shred out how much each individual member should cut oil production.
US markets closed in the negative territory on Friday, despite better than expected GDP growth figures for the third quarter, after the news that the FBI reopened an investigation of democratic Presidential candidate Hillary Clinton’s emails, raising uncertainties over elections results. The Dow Jones closed near the flatline, the S&P 500 went down 6 points and the Nasdaq lost 26 points.
Alphabet, the successor to and new parent company of Google, reported Google’s third-quarter earnings. The revenue for Alphabet Inc. (previously Google Inc) has increased 20.22% (Y-o-Y) to USD 22.45 billion. The net income has increased 24% (Y-o-Y) to USD 6.326 billion. The earnings per share was reported at USD 9.06. Share price of Alphabet fell by 1.27%in last week.
Twitter reported third quarter results ended September 2016. Revenue rose by 8% (Y-o-Y) to USD 616 million. According to GAAP twitter posted net loss of USD 103 million when compared to net profit of USD 92 million according to Non-GAAP. Share price of Twitter rose by 0.63% in last week.
Amazon reported third quarter results ended September 2016. Net sales of Amazon grew by 29% (Y-o-Y) to USD 32.71 billion. Net income was USD 252 million in the third quarter, or USD 0.52 per diluted share. Share price of Amazon fell by 6% in last week.
Apple Inc. reported fourth quarter results ended September 2016. Revenue for Apple Inc. has decreased 9% (Y-o-Y) to USD 46.85 billion. The net income has decreased 19.57% (Y-o-Y) to USD 9 billion. Gross margin was 38% compared to 39.9% in the year-ago quarter. Share price of Apple Inc fell by 2.92% in last week.
Tesla reported third quarter results ended September 2016. Revenue for Tesla has increased 145% (Y-o-Y) to USD 2298 million. The company has reported a net profit of USD 21 million from a net loss of USD 229 million on a year on year basis. Share price of Tesla fell by 0.55% in last week.
The Sensex and the Nifty fell by 0.48% and 0.63% in the last week.
Tata sons, holding company of Tata group had removed Cyrus Mistry as chairman of the conglomerate and named Ratan Tata as interim chairman for four months.
Click here read our analysis of Tata sons.
After Cyprus and Mauritius, Indian government has revised DTAA (double taxation avoidance agreement) with South Korea. Under the new treaty with South Korea, if the capital gains in India with respect to selling of shares up to 5% of the paid-up capital, then the capital gains will be taxed in South Korea. If selling of shares beyond 5% will be taxed in India.
Iron ore PSU, NMDC ltd and Mishra Dhatu Nigam Ltd, specialist in developing metals and alloys, have sealed an agreement to work on tungsten ore mining and processing for use in strategic defence areas. NMDC has entered a MOU with Directorate of Geology & Mines, Madhya Pradesh for exploration of various metals in the state. Share price of NMDC rose by 8.61% in last week.
L&T Infotech would buy Pune-based analytics start-up firm Augment IQ to gain access its big data platform that is currently used by credit bureaus, banks and as well as regulators. Share price of L&T Infotech rose by 3.65% in last week.
Suzlon announced that it has entered a joint venture with Ostro Energy for the development and construction of 50-MW solar project in Telangana. According to the contract, Ostro Enegry shall acquire 49% in this project, a SPV (special purpose vehicle) set up by Suzlon to complete this project. CARE rating agency has upgraded Suzlon investment grade rating to BBB from earlier BBB- . Share price of Suzlon rose by 4% in last week.
Asian Paints reported Q2FY17 results, revenue grew by 10.21% (Y-o-Y). Net profit grew by 17.40% (Y-o-Y). The decorative business segment in India registered double digit growth in the quarter. However, a prolonged monsoon did affect demand in West and Central India. Share price of Asian Paints fell by 5% in last week.
Maruti Suzuki reported Q2FY17 results, sales grew by 29.28% (Y-o-Y). Net profit grew by 60.19% (Y-o-Y). The rural growth was muted in the second quarter of FY17 but it is expected to pick up in the near term as monsoon has panned out higher than normal in the current season. Share price of Maruti Suzuki rose by 2.61% in last week.
Axis Bank reported Q217 results, net profit fell by 83% (Y-o-Y) to Rs. 3190 million. Provisions for this quarter surged by 412%. Gross NPA’s jumped 268% to Rs. 163786 million. Share price of Axis Bank fell by 7.6% in last week.
Bharat Financial Inclusion reported Q217 results, total income grew by 38% (Y-o-Y) to Rs. 4290 million. Net profit grew by 88% to Rs. 1458 million. Share price of Bharat Financial Inclusion fell by 3.04% in last week.
Our model Twelve Stock Retirement Portfolio has given a one-year return of 30.34% and has outperformed the benchmark Sensex by 26.22%.
On a weekly basis, Twelve Stock Portfolio has lost 2.84% in value and the Benchmark BSE Sensex has lost 0.48%. The Portfolio underperformed the benchmark by 2.35%.
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On a weekly basis, Global Ten Stock Model Retirement Portfolio has lost 1.66% in value and the Benchmark S&P 500 has lost by 0.69%. The Portfolio underperformed the benchmark by 0.97%.
Industry and Stock Specific trends
The sectoral indices closed in the negative territory last week. The S&P Bankex, Auto and IT indices have lost 0.89%, 0.34% and 3.46% respectively. The S&P PSU and Oil & Gas indices have gained by 1.15% and 0.49%respectively in the last week.
The Nifty Index futures saw rise in open interest by 412% for the November series. There was a rise in open interest by 55% for the December series and January series started with open interest of 34200 contracts in the last week. Implied volatility (IV) fell for put option rose in the last week last week. Implied volatility (IV) for call option remained neutral when compared with previous week IV. Rise in IV of Nifty put option shows unsteady marginal support for Nifty at current levels.
UPL Ltd has witnessed rise in turnover and open interest in the stock futures segment. UPL Ltd share price fell approximately 2.8% in last week.
Vedanta Ltd also witnessed rise in turnover and open interest in the stock futures segment. Vedanta Ltd reported consolidated Q2FY17 net profit grew by 12% (Y-o-Y). Revenue fell by 4.3% (Y-o-Y) mainly impacted by oil, zinc and copper segments of the business, revenue grew by 9%(Q-o-Q). Share price of Vedanta is up by 1.5% on Friday.
Foreign Institutional Investors (FIIs) Derivative Statistics have shown fall in the open interest across Index Futures, Index Options, Stock Options and Stock Futures on a week on week basis.
British pound fell against the dollar on 28th October 2016 despite better than expected growth data from the UK economy. The pound went down 0.2% to $1.2144. The GBPUSD changed -0.40% during the last week, -6.03% during the last month and -16.95% during the last year.
Indian Rupee appreciated against USD by 0.06%.