Watch
8185*-8260 & 8115*-8040* Zone In Nifty Fut (Dec)
Market Mantra: 29/11/2016
(08:30)
Nifty
Fut (Dec) may open around 8150 (+7 points), almost flat following tepid global
cues as “Trump Rally” fades amid drops in USD & continuing OPEC squabbling about Wednesday’s
meeting for a credible oil production cut/freeze.
US
bond yields were also under mild pressure after vote recounting possibility in
some of the constituents and subsequent controversial tweets by the
President-Elect Trump and some concern of tepid “Black Friday” sales beside
technical correction & profit booking in the weekend holiday thinned
market.
But,
whatever may be the reason technically, unless & until DXY does not sustain
below 100, this “Trump Tantrum” may continue for the EM currencies and along
with that the impending EU political risk may be one of the headwinds for the
EM as well as Indian market. Also, market may watch “Trump’s Twitter Handle”
more closely in the coming days as this may be another cause of instability as
an immature political leader (US-Prez).
Globally,
all eyes will be on the host of Fed speakers, Friday’s US NFP and Sunday
referendum in Italy. Any “NO” vote in the Italian constitution referendum may
be seen as another tacit approval of “divorce” from the EU and in that
scenario, the present PM (Renzi) may also quit, which may threaten political
stability of Italy as well as the whole EU universe. The very concept of EU may
also be doomed with the ongoing “Brexit” and any “Italyexit” & also “Frexit”
(France may be the next candidate for a nationalistic politics and exit from
EU).
Globally,
China market is showing good strength on the back of Yuan devaluation (helpful
for exports) and upbeat industrial profits. But, PBOC may be also tightening
its loose monetary policy in the coming days.
Similarly,
Japan may be also a beneficiary of its recent currency devaluation (Yen) as a
result of “Trumpism” in a matter of few weeks, which BOJ failed to do in the
last one year despite its 24/7 printing press going in full throttle (QQE).
But,
India being a domestic consumption story, INR devaluation may of little help
for the broader economy. Moreover, a strong USD may have several headwinds for
the import oriented Indian economy, beside concerns of large FII outflow, which
is already happening.
The
present demonetization led surge in bank deposits and its negative effect on
the bond market (lower bond yields) may be another cause of FPI exit, which RBI
is trying to address by sucking the excess liquidity from the banks as 100%
CRR.
RBI
& Govt is now also trying to do its best to contain the damage by tweaking
the demonetization rule almost every other day. The latest step of the Govt to
declare the “black money” as 50% VDS or 85% forced declaration may be another
step towards an amnesty, where no questions may be asked for “source” of this “black/unaccounted
money”.
Technically, NF (8150),
has to sustain over 8185*-8210 area for further rebound towards
8240/8260*-8335/8375 zone for the day (bullish case scenario).
On the other side,
sustaining below 8160-8115* area, NF may further fall towards 8060/8040*-8000
and 7940-7900* zone for the day (bear case scenario).
Similarly BNF (18370),
has to sustain over 18200* area; otherwise it may further fall towards
18100-17850* & 17700*-17450 zone for the day (bear case scenario).
On the other side, for
any strength, BNF needs to sustain over 18450* area for 18600*-18750 &
18850-19050* zone for the day (bullish case scenario).
SGX-NF
BNF
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