Nifty Fut may open around 8740 area today, slightly in positive note, following some "risk on" global cues as "Trumpism" probability is getting reduced day-by-day and US NFP data was below expected on Friday (as bad US economic data may be good for "risk assets" as of now). But, overall holiday thinned trade may limit any meaningful volatility today.
Technically, sustaining below 8715-05* zone NF
may fall
towards 8665-45 area today.
On
the other side, for any strength, NF need to sustain above
8775-95* area for
any meaningful rally towards 8835-75* zone.
For, BNF (LTP: 19494), immediate support is around 19340-300* area and below that expect 19040-19000 area.
On the upside, for any strength, BNF need to sustain above 19600-700* zone for further rally up to 19900-20000 area.
Though the headline US NFP (156k against estimate of 175k) and unemployment data (5% against estimate of 4.9%) was not good/below estimates, hourly wage & participation rate came as par/above estimate. This may be an indication that US workers are slowly returning to the workforce contrary to earlier trend and an above 150k NFP, its well within the Fed's comfort zone for a Dec hike.
Now, more than US economic data, Fed's decision may hinge on the actual US election outcome and other geo-political (black swan) events, like "Real Hard Brexit", Italian referendum and EU banking crisis, China credit & real-estate bubbles etc.
On Friday, "risk on" sentiment also gathered some momentum for an unconfirmed market buzz that Qatar SWF/investors, who were in deep knee loses for it earlier DB stake, is now considering to raise more stake to 25% as the scrip is hovering near life time low.
US election drama is now fast turning into a "personal mud slandering" TV debate concentrating more on Clinton e-mails saga & Trump's old obscene comments about Women rather than core economic issues for the US. Due to various irrelevant comments, probability of "Trumpism" is getting lower day-by-day at this moment, but it may end up in a tight contest in Nov simply because of some anti-incumbency factors.
Also, a clear Clinton win at this point of time may not help Fed to get another reason to be on the side line and it has to act, by not only hiking in Dec'16, but may also give a clear guidance for future rate hikes (probably 1-2 hikes per year with an never ending accommodative stance). Thus, its may be a double whammy for the market in either to face Fed hike or "Trumpism".
Among all these talks of US election/Fed hike risk, hard Brexit and EU banking crisis, China is quietly making its Yuan most weakest in the last six years (midpoint fixed at 6.7008 today).
Back to home, all eyes will be on the Q2 result season and other macros (IIP/Inflation data). Q2FY17 earnings for Nifty is expected to show double digit growth (10% YOY) this time (after a long time) whereas in Q1, it was actually +3% on YOY basis.
Rather than overall market/Nifty, stock specific actions may be more interesting today/coming days.
Analytical Charts:
SGX-NF
NSE-BNF
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