Market Mantra: 13/09/2017 (09:00)
SGX-NF: 10090 (-14)
For the Day:
Key support for NF: 10085/10045-10000/9980
Key resistance for NF: 10140/10160-10205
Key support for BNF: 24725-24500
Key resistance for BNF: 24875-24950/25050
Hints for positional trading:
Time
& Price action suggests that, NF has to sustain over 10160 area for further
rally towards 10205-10250 & 10325-10385 area in the short term (under
bullish case scenario).
On the flip side, sustaining below 10140 area, NF may fall towards
10085-10040 & 10000/9980-9940 area in the short term (under bear case
scenario).
Similarly, BNF has to sustain over 24875 area for further rally
towards 24950-25050 & 25150-25250 area in the near term (under bullish case
scenario).
On the flip side, sustaining below 24825 area, BNF may fall towards
24725-24600 & 24500 -24350 area in the near term (under bear case
scenario).
As par early SGX
indication, Nifty Fut (Sep) may open around 10090, almost flat (-14 points)
tracking mixed global/Asian cues; HK market is bucking the regional/global
trend on dips of techs/Apple components suppliers after an expensive, but high
end new i-Phone model launch yesterday.
Overnight US market closed
in moderate green around 0.30% higher helped by banks & financials on
higher US bond yields, positive for their interest hike capability and NIM.
Apple dropped after launch of its new model as it was rallied already before
the launch (buy on rumour & sell on facts).
But, risk-on mode
suffered some setback yesterday after NK issued another “dire warning” for US
for the latest UN sanctions on the country, although it was watered down
significantly and practically may not resolve the NK crisis.
In his busy Irma
schedule, Trump also commented that sanction against NK is very small thing and
bigger action may be on the table. Although, damage from Irma may be much less
than earlier estimate, overall damage from dual hurricane of Harvey & Irma
may be close to $150-200 bln, which is still huge. On the weekend, another
potential hurricane (Jose) may also hit some of the US metropolitan areas,
although with much less intensity.
DJ-30 was closed around
0.28% higher, while S&P-500 gained by 0.34% to 2496 and NASDAQ were up by
also 0.34%; both at record high.
US stock Fut (SPX-500) is
now trading around 2492, almost flat (-0.06%) on mixed Asian cues after drops
of Apple related chip makers & component manufacturers. Technically,
SPX-500 now need to sustain over 2505 area for next phase of rally; otherwise
sustaining below 2488-2480 zone, expect some correction.
Indian Market: 10160-10205 May Be A Big Hurdle For
Nifty-Fut In The Days Ahead As Valuations Are Quite Stretched & Further
Rate Cut Hopes Also Diminished
Back to home, it’s now
almost certain that Indian market
(Nifty Fut) after opening around 10090 on mixed Asian cues will try to scale
the previous life time high of around 10160, which is at striking distance; but
considering various technical scenario, it may face big hurdle around
10160-10205 zone; stretched valuation & muted Q1FY18 earnings at (-) 2% QOQ
may be the prime reason.
At 10100-10200 NS, Q1 TTM
PE may be around 26.30-26.55, which may be quite expensive by historical
standard and well above the 2-SD of 25, considering average CAGR of Nifty EPS
of around 7% in the last few years despite signs of some green shoots.
Indian market may today
focus on higher trajectory of CPI (3.36%) & also core CPI at almost 4.5%
released yesterday, which is almost at the upper end of RBI projection for
H1FY18 and thus expect RBI to stay neutral in Oct or even Dec’17 to see actual
impact of GST (increase in service tax) & widespread floods on inflation
and growth.
PSBS may be in focus
today after news that RBI has suggested options of recap bonds issuance by the
Govt to recapitalize the PSBS, although it may be now at very early stages of
discussions only. But this news may have also boosted the PSBS suddenly in
yesterday’s trading.
Also, early Diwali gift
by the Govt yesterday by increase of DA (+5%) to the Central Govt employees
& pensioners may be positive for the market ahead of festival season.
SGX-NF
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