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Has the auto rally run its course?

Automobile stocks have been one of the best performers in 2016. Tata Motors has more than doubled from its February low, while Maruti and Hero MotoCorp are up 17 per cent and 35 per cent, respectively, year-to-date. Following the rally, fund managers are considering to reduce their exposure to these stocks and invest in defensives like pharma companies, which have been laggards. If the overall market also goes into a correction mode, pharma bets will pay off, they say.

Tepid grey market premium for marquee IPOs

This month will see the initial public offerings (IPOs) of the subsidiaries of Larsen & Tourbo and ICICI Bank. The IPOs of L&T Technology Services and ICICI Prudential Life Insurance will open on Monday and September 19, respectively. But, if grey market premiums are anything to go by, there isn't much excitement. Shares of both L&T Technology Services and ICICI Prudential Life are changing hands at a premium of less than 10 per cent over the IPO price, say grey market sources. "L&T group's L&T Infotech and even L&T Finance haven't made money for investors. While the pricing for ICICI Prudential Life seems steep and so the short-term gains might not be much," said a broker.

Energy Development rises sharply

The stock price of Energy Development Corporation has seen an unusual activity in the past six months. Between February and September, it has risen from Rs 43 to Rs 181, a rise of about four times. Market players observe this stock with a lot of interest because the Samajwadi Party's Amar Singh and his wife have around four per cent stake in the company. Singh, after being dismissed by the party over six years ago, has rejoined the party and was made a Rajya Sabha member in May. There seems to be a rub-off on the fortunes of the stock as well.