Market Mantra: 27/10/2016 (08:30)
As par early SGX indication, NF may open around 8590 (-21 points) following flat US stock Fut and neutral global cues.
Technically, for NF, immediate support may be around
8560-8530* zone and sustaining
below that, NF may expire around 8500*-8465 area in the bear case scenario.
On
the other side, for any strength, NF need to stay above
8640-8670* area for an
expiry of around 8690-8720* zone in the bullish case scenario.
Similarly for BNF (LTP: 19500), immediate support may be around 19450-19350* zone and sustaining below that it may further fall towards 19200*-19000 area for the day.
On the other side, for any meaningful strength, BNF need to stay above 19600-19700* area for further rally towards 19800-19900* zone as the day may progress.
Overnight US market recovered from some loses to close flat on the back of better earnings of Boeing and rally in Oil amid surprise inventory draw down by a Govt report, contrary to earlier Pvt report. But, eventually, Crude was not able to sustain above $50, because of skepticism about OPEC's plan of production cut or even freeze.
Globally, all eyes will be on the UK GDP & US jobless claims & pending home sales today. Although, GBP got some strength day before yesterday because of Carney's calculated hawkish jawboning, yesterday it again fall as the Dy. BOE GOV popped up with some dovish scripts.
Whatever be the incoming US economic data, Fed may be now determined to raise rate in Dec'16, if there is no nasty election outcome and FFR is now hovering around 72-74%.
Back to home, Tata group of stocks will be in focus because of yesterday's "Letter Bomb" by Cyprus Mistry, alleging himself as a "Lame Duck" Chairman, who was basically controlled by the former Chairman (Ratan Tata). There were various allegations regarding the viability of certain group cos/divisions and risk of $18 bln write downs. Some of the legacy business decision like Corus & Nano is hurting the group significantly, which need to be closed immediately to prevent further loses, but it was not possible because of Tata's passion & emotion associated with it.
Now it seems that regulators (SEBI) and stock exchanges (NSE/BSE) are now quite serious and seeking clarification for the $18 bln write down probability. Also, various rating agencies may review ratings of Tata cos, because of cash-flow issue.and corporate governance.
Though, institutional investors did not show any panic till now and may be accumulating Tata stocks at lower level, institutional concern can't be ruled out in the days ahead because of various issues raised by the Mistry.
Yesterday's tepid result & volume growth of FMCG cos (HUL & Dabur, except ITC) may be also an indication that Indian consumers are not in great mood (both urban & rural).
Also continuing NPA woes may hurt the sentiment of the market today.
NSE-BNF
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