Nifty May Open In Upbeat Tone Amid Some Weakness In USD Following Concerns For Today’s US NFP Job Data; Domestically All Eyes May Be On The De & Remonetization Data/Politics & EC Today For Any Change In Budget Day

Market Mantra: 06/01/2017 (08:30)

Watch 8290-8240 & 8335-8375 Zone In Nifty Fut (Jan), Which May Open Around 8310 Today

Reports of plea of some “fresh evidence” in the SC for the Sahara/Birla case involving NAMO & demonetization related political disruption may drag the domestic market sentiment later on. 

As par early SGX indication, Nifty Fut (Jan) may open around 8310 (+22 points) following flat global/Asian cues; but supported by some weakness in the USD following overnight mixed US economic data.

Basically, market is bracing for an weaker US NFP job data later in the day after yesterday’s tepid ADP, Challenger & employment portion of the Non-Mfg ISM data; although ISM Non-Mfg PMI came good at 57.2 against estimate of 56.6 (Prior: 57.2).

Although various recent US economic reports & monthly auto sales figure are quite upbeat, USD has already rallied after “Trumpism” and any slight weakness in incoming US economic data may be proving as another reason for long unwinding/fresh short at record high USD level.

In that sense, today’s US NFP job data may be very important for short term direction of USD/US bond yields (estimate: 178k against prior 178k; Avg hourly earnings: +0.3% against prior -0.1%; unemployment rate: 4.7% against prior 4.6%). Market will keenly watch the growth in average hourly earnings, which may be vital for much awaited wage inflation in US.

Back to home, all eyes may be on the EC for any change in budget preparation date and also on the demonetization led political war/disruptions, apart from the start of result season from next week.

Hints for actionable trading ideas at index level:

Technically, NF has to sustain over 8335 zone for further rally towards 8375-8410* & 8485*-8545 area for the day (under bullish case scenario).

On the other side, sustaining below 8290 zone, NF may further fall towards 8240*-8175 & 8125*-8040 area for the day (under bear case scenario).

Similarly, BNF (LTP: 18144) has to sustain over 18250 area for any further rally towards 18400*-18575 & 18650*-18800 zone for the day (under bullish case scenario).

On the other side, sustaining below 18200 zone, BNF may further fall towards 18000*-17900 & 17800*-17600 area for the day (under bear case scenario).

Some reports that RBI may not be obliged to cut rate in Feb may hurt the sentiment for the banks & the rate sensitive sectors.

SGX-NF

BNF