Market Mantra: 14/12/2016
(08:30)
Watch 8250-8325 & 8185-8125 Zone In
Nifty Fut (Dec), Which May Open Around 8220 Today
All eyes will be on the India WPI &
Fed’s dot plots & economic projection for 2017 today (forward guidance) as
0.25% rate hike may be already discounted by the market.
As
par early SGX indication, Nifty Fut (Dec) may open around 8220, almost flat
following tepid global cues on concern about Fed outlook for US rate hikes
& overall economy in 2017 as market may be already digested the much anticipated
0.25% rate hike today.
A “surprise”
will be no rate hike or hike by 0.50% by Fed, which is most unlikely at this
point of time, because in that scenario, Fed’s own credibility will be at
stake, considering its 2015 dot plots forecast (4 rate hikes in 2016!!) & subsequent
flip flops and the jawboning for the last few months for an annual hike in 2016
as overall US economic data may be well over the Fed’s tolerance level for a
0.25% rate hike as of now.
Market
may be also expecting at least 2 rate hikes in 2017 @0.25% (June-Dec) and any significant
deviation from that projection may cause some volatility in the global as well
as Indian market in the days ahead.
If
Fed take the script of “Dovish/Owlish” hike today, USD may fall to some extent
and in the case of any “Hawkish” hike, USD may rally further, causing
significance pressure on the EM currencies and the market including India.
Back
to home, all eyes may be on the WPI today after yesterday’s surprise fall in
CPI, which may be another indication of the economic slowdown as an immediate
impact of the demonetization. WPI is expected to come around 3.10% for Nov
against Oct figure of 3.39%.
As
par some reports, to contain the demonetization “pain” for the general public
ahead of state elections, Govt may shortly announce some relief measures and
social spending packages intended for the “Aam Admi” and small
businesses/traders, which has big traditional support base for the BJP/RSS. Govt
may be also exploring various ways for some tax cuts and a “dream: budget for
FY-18 in expectation for a “huge” windfall gain after the demonetization, which
so far yield insignificant benefit against the overall collateral damages
already done to the economy.
All
eyes will be on the demonetization debate in the Parliament also in the last
three days left after hopes for GST passage is almost dashed in the current
winter session.
Technically, NF needs to sustain above
8250 zone for any rebound towards 8300/8325*-8375 & 8405/8435*-8485 area
today (under bullish case scenario).
On the other side, sustaining below
8225 area, NF may further fall towards 8185/8165*-8125 & 8085-8040* zone
for the day (under bear case scenario).
Similarly, BNF (LTP: 18490) need to
stay above 18550 area for any rebound towards 18675-18800* & 18900-19100*
zone for the day (under bullish case scenario).
On the downside, sustaining below 18450
zone, BNF may further fall towards 18300-18200/18150* & 17950*-17850 area
for the day (under bear case scenario).
SGX-NF
BNF
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