International rating agency Moody’s upgraded India’s foreign and local currency issuer rating from Baa3 to Baa2 and changed the outlook from positive to stable.
The upgrade came after a gap of 13 years backed by an implementation of strong reform programs by the government.
Indian capital markets cheered this upgrade by posting stellar gains at the close.
Impact of credit rating upgrade: An upgradation of the credit rating will have a structural impact on the Indian economy and will lead to the following outcomes:
- Reduction of company-specific risk premium.
- Reduction in cost of international borrowing.
- Appreciation of Indian Rupee.
- Improved investment sentiment of institutional foreign investors
Symbol
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CMP
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Reasoning
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View
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ICICI Bank
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Rs 325.1
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Reduction in country-specific risk will lead to lower cost of borrowing resulting in better financial stability.
Tracking the technical’s, the stock has given a bullish Flag pattern breakout on daily charts. |
Bullish
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State Bank of India
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Rs 337.5
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Up-gradation in baseline credit assessment and a reduction in bond yield will aid its financial stability. Tracking the technical’s, the stock has given a bullish Flag pattern breakout on daily charts.
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Bullish
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IOC
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Rs 395.15
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Appreciation of Indian Rupee will benefit importers like all the major OMC’s. Tracking the technical’s, the stock has formed a bullish Doji candlestick pattern on weekly charts and has taken a support near its 200day EMA.
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Bullish
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