Capital Goods Stocks Outlook For The Week - 08 To 12.10.2018

Capital Goods Stocks Outlook For The Week - 08 To 12.10.2018

             Equity Cash/Futures/Options Segment 

Stocks of capital goods companies will continue to remain weak, tracking the weakness in the broader market, with no near-term sector-specific trigger in sight. However, the focus will remain on
shares of IL&FS group companies--IL&FS Transportation Networks and IL&FS Engineering and
Construction Co--which are likely to continue rising after the recent management takeover of the parent company by the government. Through the week, the stocks gained 35-89%. Broadly, there is no upside seen in the capital goods space as private sector capital expenditure remains muted and the government orders may start tapering down as elections come closer. Investors will also look forward to industrial production data for August, due to be released on Oct 12. The change in RBI's monetary policy stance to 'calibrated tightening' from 'neutral' and clear statements that rates are best set to remain at current levels, and rise in the worst case, are likely to keep the broader market down next week.

Source : Cogencis Information Services Ltd.

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