Market Wrap: 08/11/2017 (17:00)
NSE-NF (Nov):10365 (-45; -0.43%)
(TTM PE: 26.15; Abv 2-SD of 25; TTM Q1FY18 EPS: 394;
NS: 10303; Avg PE: 20; Proj FY-18 EPS: 418; Proj Fair Value: 8360)
NSE-BNF (Nov):25338 (-58; -0.23%)
(TTM PE: 27.92; Abv 2-SD of 25; TTM Q1FY18 EPS:
902; BNS: 25184; Avg PE: 20; Proj FY-18 EPS: 961; Proj Fair Value: 19220)
For 09/11/2017:
Key support for NF: 10325/10290-10240
Key resistance for NF: 10410-10450
Key support for BNF:
25200-24950
Key resistance for BNF: 25550-25700
Trading Idea (Positional):
Technically, NF has to sustain over 10425-10450 area for further rally towards 10525-10575
& 10625-10675 zone in the short term (under bullish case scenario).
On the flip side, sustaining below 10400 area, NF may fall towards 10325/10290-10240
& 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 10365, plunged by another 45 points (-0.45%) after making
an opening session high of 10423 and late day low of 1033 amid muted global cues
and domestic worries about macro impact of higher oil on the economy and Govt’s
stance of “war on black money” & money laundering angle by high profile
rich/shell cos from Panama to Paradise fiasco.
Indian market today opened almost flat on mixed Global cues
amid drops in USD & soft China trade data. USD was lower on US corp tax cut & some other uncertainties
coupled with renewed NK rhetoric by Trump in contrast to his softer stance
yesterday inviting Kim to come to the dialogue table to make a deal. A lower
USD is not good for export heavy Asian & EU market. But even then, Indian
market underperformed its global peers for two consecutive days on domestic
issues of higher oil & corruptions.
Also, overall corporate
earnings so far may be mixed & stable, but not enough to justify the skyrocketing
valuations of the Indian market amid DeMo & GST disruptions and a slowing
economy.
In contrast, stock market of Japan & China may be relatively
cheap and thus FIIS are on a buying rampage there. Regulatory reform in China,
political stability in Japan, attraction of Abenomics, rebound of JP economy from
decade old deflation and FII under ownership may be some of the reasons behind
huge FII flow there.
Looking ahead, Indian market may focus on GST simplifications on 10th Dec; as par some trial balloon,
Govt may shift almost 165 daily usage items from 28% tax to 18% slab and only
62 items including Cigarettes, AC, Refrigerator, Digital Camera, and Lottery to
remain in the 28% slab. Govt may also bring real estate/construction sector,
electricity under GST.
But frequent changes in GST slabs may be also affecting the manufacturers
& traders, who will again compel to keep minimal stocks at trade for tax
uncertainty and thus the post GST implementation disruptions & de-stocking
will continue, which in turn may also affect the H2FY18 earnings.
Also, GST is now becoming a hot political topic; all eyes may be
also on the EC for any issues regarding big-bang GST simplification announcements
by the Govt just ahead of state elections in GJ & HP. After UP, the
election in GJ may be another acid test for Modinomics (DeMo & GST) as the
state (MSME) may have severely affected; any below estimate election outcome
for BJP in GJ may be also a warning sign for the Indian political stability.
Today Nifty was supported by Axis Bank (fund
raising plan), Bharti Infratel (buzz of tower deal), Asian Paints, TCS, TECHM
(weak INR), Indusind Bank, Sun Pharma (upbeat report card from Taro), L&T,
Cipla (decent earnings) and M&M (e-car optimism amid chocking winter pollution
in Delhi); together these cos has contributed around 25 points.
Today Nifty was dragged
by RIL (concern of higher debt burden & capex), VEDL, Tata
Motors (Delhi pollution, terrible sales for JLR & concern for earnings ahead
of result after muted report card from ASL today), ICICI Bank, SBI, HDFC,
Bharti Airtel (stake sale), Yes Bank, IOC, Bajaj Fin by cumulatively around 65
points.
Overall, Indian market was today helped by techs, pharma/healthcare (higher
USDINR favourable for their export income), media, while dragged by banks &
financials, specially PSBS after muted report card from OBC and reports of NPA
divergence of PNB, metals (mixed China trade data), rate sensitive stocks like
property developers, automobiles as any rate cut hopes by RBI is now
practically non-existent on higher oil/higher inflation equation.
Europe Set To Trade Almost Flat Amid Mixed Global Cues On Lower USD & US Tax Reform Worries
Asia Edged Down On Lower USD Amid US Tax Reform Squabbling Coupled With NK Rhetoric By Trump & Mixed China Trade Data
USD In Back Foot On Renewed US Tax Reform Suspense & Trump's NK Rhetoric
SGX-NF
NIKKEI-225
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