Market Mantra: 23/11/2016
(08:30)
As
par early SGX indication, Nifty Fut (Nov) may open around 8050 (+32 points)
following overnight record highest ever closing of the US market and positive/stable
Asian cues amid holiday thinned market (Japan closed today and there will be
four day weekend for the US market starting from tomorrow).
Globally,
USD regains some strength after initial drops yesterday supported by upbeat US
economic data (Existing home sales & Richmond Fed Mfg index). Also, overall
bond yield spread between US & German/EU/UK are helping USD and unless DXY (101)
has sustained below 100, it may again rally towards 102 & 103-105 zone in
the near term, which may put immense pressure on the EM currencies including
INR. Recent outflow from India pegs around $10 BLN and in the likely scenario
of a hawkish Fed & “Trumponomics”, we may see more outflow from the EM as
well as the Indian market.
Today,
all eyes will be on the FOMC minutes (Nov) to have some idea about Fed’s core
thinking about Dec’16 & 2017 rate hike plans.
Oil
is again come under some pressure amid continuing OPEC squabbling despite
supportive inventory data as now Iraq is raising some points about the production
cut/freeze.
Metals,
specially copper & iron ore has rallied significantly due to Chinese
demands/stocking ahead of holiday season there and Trump rhetoric about more
fiscal/infra spending.
UK,
also unveil its budget shortly, which may also emphasize more on fiscal/infra
spending along with tax cuts.
Back
to home, Indian market may continue to be under pressure despite some short
covering led “dead cat bounce” as it seems that there is no meaningful follow
up buying support in the market amid concerns of demonetization.
All
eyes will be also on the intensifying political battles on the parliament
streets of New Delhi as well as on the “real battle” going on at the J&K
LOC (Pak).
The
growing political “war of words” & debates because of the demonetization
between different parties & BJP may eventually derail the immediate passage
& implementation of GST and some other vital reform initiatives by the
Govt.
Technically, NF has to
sustain over 8080* zone for further rebound towards 8115-8160* & 8215-8245*
zone for the day (bullish case scenario).
On the other side,
sustaining below 8040* area, NF may fall towards 8000*-7960 & 7920-7870 and
7700-7650 zone for the day (bear case scenario).
Similarly, BNF (18600)
need to sustain above 18850* zone for further up move towards 19050*-19200
& 19450-19650* area for the day (bullish case scenario).
On the other side,
sustaining below 18440* zone, BNF may further fall towards 18350*-18200 &
18100-17850 and 17650-17425 area for the day (bear case scenario).
NF
BNF
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