Market Wrap: 23/05/2017
(17:00)
NSE-NF (May): 9388 (-55;
-0.58%) (TTM PE: 23.82; Near 2 SD of 25; TTM EPS: 394; NS-9386)
NSE-BNF (May): 22575
(-102; -0.45%) (TTM PE: 31.02; Above 3 SD of 30; TTM EPS: 728; BNS-22583)
For 24/05/2017:
Key support for NF: 9360/9330-9280/9240
Key resistance for NF:
9455/9475-9515/9535
Key support for BNF: 22450-22300
Key resistance for
BNF: 22675-22775
Time & Price action suggests that,
Nifty Fut (May) has to sustain over 9475 area for further rally towards 9515/9535-9575/9600
& 9680-9770 in the short term (under bullish case scenario).
On flip side, sustaining below 9450
area, NF may fall towards 9360/9330-9280 & 9240-9205 area in the short term
(under bear case scenario).
Similarly, BNF has to sustain over 22675
area for further rally towards 22450-22300 & 22050-21800 area in the near
term (under bullish case scenario).
On the flip side, sustaining below
22625 area, BNF may fall towards 22650-22590 & 22450-22300 area in the near
term (under bear case scenario).
Nifty
Fut (May) today closed around 9388, dragged by almost 0.58% lower after making
an opening minutes high of 9464 & day low of 9371 following news of 2nd
Surgical Strike (Punitive fire assaults) at PAK LOC by the Indian Army flashed
out.
Indian
market today opened almost flat following
positive/mixed global cues. Overnight US market closed in positive (+0.43%) taking
cues from Trump’s “successful” overseas tour so far, which saw billions of
dollars in defence contract procurement for various US companies with Saudi
Arabia (Trump really means business !!). Apart from defence & industrials,
US market was also supported by energy shares amid growing optimism about the
OPEC production cut extension for another 9 months with some deeper production
cuts (?).
But global market risk-on sentiment suffered some set back after
a horror terrorist attack in the London-Manchester concert later in the day. As
a result, USDJPY & risk-trade was subdued in the morning Asian session.
Strength in Yen is causing some pressure on the Japanese market; but optimism
of China’s A-500 index inclusion probability in the MSCI index may be
supporting the China market sentiment to some extent.
Overall, yesterday’s sad UK terrorist attack may be or may not
be an isolated incident (ISIS is already claiming its responsibility); but it
may also affect poll prospects of May (UK PM) & the Brexit negotiations.
Already, various recent opinion polls are indicating narrower win for May, which
is affecting the GBP.
Soon after Indian market opening today, market suffered some
sharp selloff despite stable global cues, apparently because of concerns for
GST and NPA policy complexity coupled with overall mixed Q4 report card. But
various market buzz was already there regarding another “surgical strike” at
the PAK LOC and an imminent press conference by the Indian Army. That may be
the primary reason for such sharp selloff in the opening session today, which
was later confirmed by the Govt/Army around 15:00 HRS, just 30 minutes prior to
the market closing.
After initial morning selloff today, Indian market recovered to
some extent following positive EU market & upbeat EZ economic data. Also,
some comments by the policy makers regarding NPA ordinance & its mechanism may
have triggered some short covering of the PSBS. But soon after that, market
tumbled again for the day low after Indian Army announced officially about the
Mini-Surgical Strike at LOC with PAK army posts.
Although, this may be a small artillery fire assaults by the
Indian Army, market may also watch any further action & reaction of both
the countries (Ind & Pak) due to increasing domestic & political compulsion
and audience pressure. Also, being politically stable and Indian market is
hovering around life time high with very little concerns and upbeat macro
economic data, Indian Govt (NAMO) may find it as an ideal time to keep pressure
on the PAK and destroy its terror machines completely, even if it require a
mini-war or frequent such mini surgical strike.
There were already enough indications from the Govt and various
stake holders (FM/DM/HM/Air Force Chief) about India’s hard stance and sudden
attack on PAK at LOC in the recent times, if we follow various statements from
them.
Indian market today was dragged by Adani Ports (adverse HC observation
for its Kerala/ Viziniagram Port), Pharma shares (below expected result from
Taro, a Sun Pharma subsidiary & ongoing concerns of US FDA), PSBS/ private banks
(except ICICI), oil & gas and capital goods.
Nifty was supported today by autos such as Maruti (better PV industry
prospect and high demand), Tata Motors, M&M and metals (some recovery in
China metal space)
Looking ahead, market may focus more on the fine prints of NPA ordinance/latest
RBI directives and effect of GST on the economy & industry/business along
with monsoon & Q4 results. As par some analysts/rating agency, working
capital cycle of Indian Inc/business may be affected for the first few months
as a result of GST disruption/procedural issues.
Overall, today’s geo-political tensions at LOC being not very
big in nature, if there is no further escalation or “war of words”, we can
expect some bounce back tomorrow, provided global cues are stable; watch 9360-9330 zone as vital technical
support for tomorrow.
SGX-NF
BNF
Article Courtesy By: frontiza.com
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