Nifty Settled Around 0.40% Lower After Some Long Unwinding Ahead Of Brexit Referendum

Nifty Fut (June) closed around 8221 after making a low of 8206 and opening high of 8253. It was a very range bound day but there was some stock specific actions. 

Textile sector (Arvind Mills, Century Textiles etc) rallied quite smartly after market report of a possible cabinet meeting tomorrow for a special package of the industry as the sector was reeling under severe stress for the last few years. Also, IMD report that monsoon has already covered half of our country, gave some support to rural economy related stocks, such as Bajaj Auto, Hero Motors, TVS motors etc.

Going forward, technically, NF has to sustain over 8200-8180 zone for any bounce back till 8280-8335 & 8380-8410 area; otherwise sustain below 8180 territory, it will fall towards 8140-8060 area and only sustaining below 8060 zone, it may fall further towards 7940-7850 area.

Globally, apart from Brexit drama, all eyes will be on Yellen & Draghi speech today.

If Yellen indicate that Fed meet will be live in July-Sep'16 as probability of "Brexit" is now much more lower, then USD may rally. On the other side, if Fed chairwoman still maintain her "dovish stance", Yen will rally, which may be negative for risk assets as of now.

Some stock specific actions:

1. Tata Comm gained after reports of stake sale for its ATM business.

2. Bank Of India gained after reports of stake sale of its life insurance JV.

3. FM radio & some TV media companies gained after Govt invited applications for e-auctions for 266 new FM radio channels in 92 cities.

4. Metals, infra and also some IT stocks stocks witnessed some profit booking in longs after significant rally of yesterday ahead of "Brexit" referendum in a "risk off" mode. Pharma shares also retraced after yesterday's FDI inspired rally.

5. Bank stocks are today under some selling pressure after "Rexit" inspired rally yesterday amid renewed concern of stressed assets and tepid credit growth as there is still some atmosphere of "fear mongering" in the minds of both lenders & borrowers as a result of recent KFA loan recovery issue.

6. Stocks of foods & beverage industries, such as Britannia, Jubilant foods fall today after CSE removed some additives (Potassium Bromide) from its approval list as it may cause some form of cancer.