Auto Stocks Outlook for the week – 07 to 11.09.2015
( www.rupeedesk.in )
Stocks
of automobile companies are likely to continue tracking broader indices next
week and trade under pressure due to the global economic environment showing
signs of uncertainty. Global cues will overpower domestic trends in the near
term because the auto sector does not have strong triggers of its own
currently, the sales environment has also not been very positive.
Automobile
sales for the month of August were not really positive, with most automakers
presenting a muted growth, and some segments still declining. Motorcycle sales
continue to be in the red, which would maintain pressure on stocks of
two-wheeler manufacturers through the coming week.
Stocks
of commercial vehicle manufacturers look better poised than peers. Adding that
passenger vehicle stocks would still be preferred over two-wheelers. Benign
fuel prices would be a marginal positive for automobile stocks.
We
expect further downward correction in auto stocks over the next few sessions
due to negative
outlooks
expressed by senior management of various automakers during the annual
conference of the Society of Indian Automobile Manufacturers.