Friday, 10 November 2017

Nifty Closed Almost Flat On GST Reform Optimism After Stumbled By Japan Led Epic Fall



Market Wrap: 09/11/2017 (17:00)

NSE-NF (Nov):10373 (+18; +0.17%) 

(TTM PE: 26.16; Abv 2-SD of 25; TTM Q1FY18 EPS: 394; NS: 10309; Avg PE: 20; Proj FY-18 EPS: 418; Proj Fair Value: 8360)

NSE-BNF (Nov):25465 (+166; +0.66%) 

(TTM PE: 28.04; Abv 2-SD of 25; TTM Q1FY18 EPS: 902; BNS: 25291; Avg PE: 20; Proj FY-18 EPS: 961; Proj Fair Value: 19220)

For 10/11/2017: 

Key support for NF: 10290-10240

Key resistance for NF: 10350-10425

Key support for BNF: 25200-24950

Key resistance for BNF: 25550-25700

Trading Idea (Positional):

Technically, NF has to sustain over 10380 area for further rally towards 10425-10475 & 10525-10575 zone in the short term (under bullish case scenario). 

On the flip side, sustaining below 10350 area, NF may fall towards 10290-10240 & 10190-10130 zone in the short term (under bear case scenario).

Technically, BNF has to sustain over 25550 area for further rally towards 25700-25800 & 25950-26100 zone in the near term (under bullish case scenario).

On the flip side, sustaining below 25500 area, BNF may fall towards 25300/25200-24950 & 24800-24550 area in the near term (under bear case scenario).

Indian market (Nifty Fut/India-50) today closed around 10373, edged up by almost 18 points (+0.17%) after making an opening minutes high of 10400 and mid-day low of 10303. 

Indian market was today stumbled by sudden fall in Japanese share and subsequent global/regional risk aversion move; but recovered quite smartly on similar trend in HK share coupled with earning optimism from Tata Motors and hopes about GST simplification & solid SBI report card tomorrow.

Indian market today opened around 10386; gap up by almost 21 points amid mixed global cues tracking lower USD on suspense of US tax reform modalities & corp tax cut uncertainty coupled with an upbeat China PPI data.

But there was some report that because of IPO frenzy in China/HK, interbank rate in HK money market has shoot up and thus there is some risk aversion move; USD & HK/JP stocks nosedived affecting the overall global/Asian risk-on mood. There was also some signal of back door BOJ QE tapering in today’s BOJ minutes (summary of opinions).

There was sudden plunge in JP equities of around 1.5% in last hour of trade; but it may be due to also options related settlement/position adjustment for tomorrow (Japanese Special Quotation-SQ calculated on every 2nd Friday). It further exacerbated by Algo driven move and reminded the similar movement almost one year ago on the day of “Trumpism”.

Although Japan (Nikkei-225) closed only 0.20% lower, Nikkei-Fut is now down by over 2% after spot closed. Also, there was some concern over divergent NK stance between US & China amid increasing rhetorics by Trump.

Indian market was also in pressure amid ongoing concern over Saudi purge & resultant higher oil coupled with increasing PMLA action by the Govt to stop the flow of black money in financial assets (EQ/MF/LI etc).

Today Nifty was supported by RIL (analyst upgrade on oil optimism & fresh fund raising to roll over existing debt & capex; new launch of attractive data plan and optimism about new telecom policy), ICICI Bank, IBULLS HSG, SBI, HUL, Asian Paints, BOSCH, Bharti Airtel, Adani Ports & Tata Steel by around 45 points altogether.

Nifty was dragged by ITC (GST rate on cigarettes to remain at 28%+), HDFC, Bajaj Fin, IOC, Bharti Infratel, ONGC, Eicher Motors, Axis Bank, Kotak Bank & HPCL by around 44 points cumulatively.

Overall, Indian market was today helped by Banks/PSBS (hopes of upbeat report card from SBI tomorrow), financials, techs, metals (upbeat China PPI data & surge in steel prices there), consumer durables & consumption stocks (optimism for reduction of GST rates from 28% to 18%), energies (higher oil & renewed optimism about GRM) infra/telecom (new telecom policy optimism), MNC (relatively higher USDINR).

Indian market was dragged by automakers (anti-pollution concern after Delhi smog fiasco & subdued Oct sales numbers), mixed FMCG, media, pharma/healthcare (nature of WL for Lupin is quite serious in nature), property developers/reality & PSU stocks.

Meanwhile, Crude Oil (WTI) is now trading around 57.25, up by almost 0.77%; it made a low of 56.40 yesterday on unexpected inventory addition in the EIA report, but soon after that it went to a high of 57.90 on news of fire in Gulf of Mexico. 

Market may be also concerned that more US production can come online as producers can hedge any future downfall by selling long dated contracts at current higher prices.

WTI is now getting some bids from mews that Saudi Arabia has ordered its citizens to be out of Lebanon “immediately”; Saudi has also intensified its “war on corruption” and detained more than 200 people on alleged corruption of more than $100 bln.

Also, there was news that Present Saudi King Salman may step down soon to make for his son Moh BiN Salman amid “Saudi Games of Thrones”; this may boost up oil more on increasing geo-political shake up in Gaudi & Gulf area.

Oil today further boosted by Kuwaiti Oil minister jawboning that “there could be many options on the table to stabilize oil price like an extension, deeper production cuts or even some other surprise”.

Technically, whatever be the narrative, WTI now has to sustain over 57.85-58.05 area for 58.85-60.25 & 61.60-62.30; otherwise it will come down; immediate support is now around 55.60-55.00 zone.


Europe Set To Trade In Stress On Lower USD Amid Mixed Global Cues & US Tax Reform Squabbling

By Asis Ghosh | 09/11/2017 - 08:35


USDJPY Drops On US Tax Reform Suspense & Economic Slowdown Concern

By Asis Ghosh | 09/11/2017 - 11:11 

Asia Stumbled But Closed Mixed After Last Hour Plunge In Japan On Lower USD

By Asis Ghosh| 09/11/2017 - 15:00 

USD Sinks On "Confirmed" Report Of One Year Delay In US Corp Tax Until 2019

By Asis Ghosh | 09/11/2017 - 18:01





SGX-NF



BNF


WTI


 USDJPY

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