Nifty May Open Almost Flat Amid Tepid Global Cues Following Uncertainties About Trajectory Of “Trumponomics” Ahead Of Trump’s Congressional Speech Tomorrow; Domestically, All Eyes Will Be On Feb Auto Sales & Various Macroeconomic Data This Week

Market Mantra: 28/02/2017 (08:30)

Watch 8995-8870 & 9035-9075 Zone In Nifty Fut (March), Which May Open Around 8940 Today

As par early SGX indication, Nifty Fut (March) may open around 8940 (-17 points), slightly lower than the LTP on the last trading day following tepid global cues after Trump & Co indicated that the much awaited fiscal/infra spending may actually happen only in next year (2018), considering huge budget/fiscal deficit for the US Govt. Also, Trump may not be in a position to divulge & implement any tax reform (huge cut) for the US corporate before Aug’17, despite his ongoing jawboning about an immediate “phenomenal tax cut”. All eyes now is Trump’s 1^st congressional speech tomorrow, where market is expecting some definitive clues about Trump’s “huge tax reform”.

As a result, both USD/US bond yields are under pressure and “risk on” trade is also subdued along with ongoing EU political risks.

Back to home, a fall in USD/US bond yields may benefit INR and also support the EQ market, although the market may have already discounted a no rate hike by Fed in March’17. As US rate & USD trajectory may depend more on US politics (Trump) rather than US & global economics, probability of a 3 or even 2 rate hikes may be minimal and subjected to various caveats this year as Trump is now himself against a stronger USD contrary to his earlier election rhetoric.

Apart from global cues, domestic market may also look into the monthly auto sales data, PMI for Feb, actual GDP growth for Q3FY17, CPI & IIP this week to gauze the actual state of the economy after demonetization. Also, next week’s state election result on 11^th March may be vital (exit poll will be published on 9^th March evening). Going by the recent rally in the market, a BJP win or a good result in almost all the states including UP may be already discounted by the market to a large extent.

Hints for actionable trading idea:

Looking at the chart, Nifty Fut (March @8940) has to sustain over 8975 area for 8995/9015-9035 & 9075-9125 area for the day (under bullish case scenario).

On the other side, sustaining below 8955 zone, NF may fall towards 8890-8840 & 8800-8725 for the day (under bear case scenario).

Similarly, BNF (LTP: 20878) has to sustain over 21150 area for further rally towards 21350-21500 for the day (under bullish case scenario).

On the other side, sustaining below 21100 zone, BNF may fall towards 20850-20700 & 20600-20450 for the day (under bear case scenario).