(Bloomberg) --  

Before the trading day starts we bring you a digest of the key news and events that are likely to move markets.

Good morning, this is Ashutosh, an equities reporter in Mumbai. India is on a winning streak, both on and off the field. With the stock market sitting at a record high and our cricket team securing a World Cup victory on Saturday, investors are buzzing with excitement. This optimism is the tonic bulls need as the next catalyst as they enter a seasonally favorable month for stocks. 

Some more on the cricket triumph

Our victory in the short-format cricket tournament played in USA and Caribbean nations not only boosts the game’s global appeal but also targets the Asian diaspora, which has a growing ability to spend. Locally, a variety of stocks are reaping the benefits, from quick-service restaurant operators to cricket franchise owners such as India Cements, food delivery firm Zomato and television and entertainment companies like Network 18 Media and Sun TV.

Vedanta rides high on strategic moves 

After missing out on the rally in equities over the last two years, billionaire Anil Agarwal’s Vedanta Ltd. is seeing things going in its favor. His move to demerge the firm is winning applause from investors, with shares rallying 75% in Mumbai this year. Additionally, the London-based parent’s junk dollar notes are in demand. Now, Vedanta Resources is now allowed to take control of Konkola copper asset in Zambia, just as the global demand for the metal rises.

All eyes on yield impact after JPMorgan bond inclusion

On Friday, Indian bonds officially joined JPMorgan’s Emerging Markets bond index, and we saw just 16.5 billion rupees ($198 million) of foreign money come into the index-eligible debt. This highlights investors’ pre-positioning that has contributed to our bonds being Asia’s top performers this year, notes my colleague Ronojoy Mazumdar. Moving forward, we’ll be watching to see just how much of the expected money actually flows in. This will a big key in figuring out if yields can drop further without any changes in interest rates.

Analysts actions:

  • Crompton Greaves Cut to Add at Axis Capital
  • NTPC Cut to Hold at HSBC; PT 355 rupees
  • Power Grid Cut to Reduce at HSBC; PT 270 rupees
  • United Breweries Raised to Accumulate at Dolat Capital

Three great reads from Bloomberg today:

  • Big Take: Boom in 24-Hour Stock Trading Has Wall Street Rattled
  • Where Stock Market Is Headed After Wild First Half: Five Charts
  • Why It Feels Like Everyone In the World’s Heading to Japan

And, finally..

After the second-best start to the year in over five years, seasonality favors the India equity bulls. Historically, Indian stocks perform better in the second half of the year, averaging returns of close to 10% over the past two decades, notes my colleague Chiranjivi Chakraborty. However, the next six months packed with significant events, including the federal budget and the US presidential elections, which could impact the markets. With strong earnings growth, the odds of a ninth straight year of positive returns favor the bulls.

 

--With assistance from Ronojoy Mazumdar and Chiranjivi Chakraborty.

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