Watch
8060*-8000 & 8115-8155* Zone In Nifty Fut (Dec)
Market Mantra: 28/11/2016
(08:30)
As
par early SGX indication, Nifty Fut (Dec) may open around 8080 (-39 points)
following negative global cues & weekend surprise of RBI action to suck up
excess liquidity from the Indian banking system as a result of demonetization
led huge inflow of deposits in old currency notes.
USD
is under some pressure as market may have some second thought about reality of “Trumponomics”
and its design (funding, ultimate congressional approval etc) and weekend “Black
Friday” retail sales figure. Technically, USD was also in very overbought condition
and that may be one of the prime reason also for the correction.
Oil
was also under pressure in the late weekend trading as a Saudi Arabia may not
attend the Vienna meeting at all amid continuing OPEC squabbling. Saudi Arabia
now sees natural Oil rebalancing in 2017 as demand may increase significantly
from the US.
Back
to home, when India was debating about effectiveness about the demonetization,
which is fast turning into a full blown political battle, RBI made CRR 100% for
the incremental bank deposits in an unexpected (?) move on the weekend. This
may suck up liquidity for around Rs.3.50 lac cr from the banks and may be
significantly negative for their NIM, as they have already lowered some of
their deposit rates and MCLR.
Although,
this move of the RBI may make the GSEC bond yields higher and INR may also gain some strength today supported by
falling dollar index, overall excess liquidity with the Indian banks mat also
reduce dramatically.
Apart
from RBI repo rate cut, savings/deposit rate and overall liquidity in the system
may be the other prime factors for the banks to transmit incrementally lower
rate into the economy (borrowers). With this RBI move to suck up excess
liquidity in the banking system to make it “neutral” as par its monetary
policy, benefit of lower rate in the economy may be shattered in the near
future.
As
a direct fall out of demonetization and “war on black money”, informal lending & credit system with the Indian economy
has virtually collapsed, especially at the bottom level of rural economy
(agriculture, SME etc) and under the scenario of less banking activities of
lending & borrowing in the economy by the banks may be worse.
Technically, NF (8080)
has to sustain over 8115* zone for further rebound towards 8155-8185* &
8210-8260* area for the day (bull case scenario).
On the other side,
sustaining below 8060-8045* area, NF may further fall towards 8000*-7960 & 7915*-7880
and further 7805-7675* zone for the day (mild to extreme bear case scenario).
Similarly BNF (18553)
has to sustain above 18650* area for any up move towards 18750*-18900 &
19050*-19300 zone for the day (bullish case scenario).
On the other side, sustaining
below 18400* zone, BNF may further fall towards 18200*-18100 & 17850-17700*
area for the day (bear case scenario).
SGX-NF
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