Reliance Industries stock rallies as CLSA reiterates ‘Buy’ rating

Indian Markets:

• Nifty 50 Movement: Indices settled above the 17,100 level.
• The past week has been marked by a few notable events in the financial markets, with crude oil prices falling and US banking crises easing. These developments, combined with the expectation of a likely pause in rate hikes from the US Federal Reserve, have supported buying across many sectors.
• Crude oil prices have seen a decline, with Brent crude oil falling to around $63 per barrel, down from $66 at the beginning of the week. This has been driven by increasing concerns over the spread of the COVID-19 pandemic, particularly in Europe and Asia.

Global Markets:

• Markets in Europe and Asia advanced on Tuesday after Wall Street staged a relief rally overnight on hopes the banking crisis may be easing, following the $3.2 billion takeover of Swiss bank Credit Suisse by rival UBS.
• Meanwhile, Japanese Prime Minister Fumio Kishida is heading to Ukraine, as per reports. Kishida has left India after meeting his counterpart Narendra Modi. The Japanese prime minister is reportedly expected to hold talks with Ukrainian President Volodymyr Zelenskyy later in the day.
• The Federal Open Market Committee (FOMC) meeting is scheduled for March 21 and 22. The US Fed rate hike decision will be announced on March 22 followed by a press conference. Investors will keep an eye on the actions of the American Central Bank to see how it will proceed in its fight against inflation in light of the shakeup in the banking sector.

Stocks in Spotlight:

• Reliance Industries witnessed a boost in its stock prices as CLSA, a leading brokerage firm, reiterated its ‘buy’ rating on the stock. The company’s stock had been subdued over the last 18 months, with a lack of significant announcements contributing to the stagnation. However, CLSA’s endorsement of the stock appears to have helped turn the tide.
• Shares of City Gas Distribution (CGD) companies saw a surge on March 21st following a bullish report by CLSA, a leading brokerage firm. According to the report, CGD players like Indraprastha Gas Ltd (IGL), Mahanagar Gas Ltd (MGL), and Gujarat Gas are likely to see improved earnings stability as pricing power returns to the sector. CLSA’s analysis suggests that the regulatory regime governing CGD companies will become more favorable from April 1st, providing a boost to the industry.
• TATA Motors has announced that it will be increasing the prices of its products by up to 5 percent from April 1, 2023. The price increase will be applicable across the company’s entire range of commercial vehicles, with the exact amount varying depending on the specific model and variant. TATA Motors has emphasized that the price hike is necessary to offset rising costs and maintain profitability. The company has cited a number of factors, including higher input costs and increased transportation costs, as contributing to the need for a price increase.

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