Friday, 8 December 2017

Nifty Soared On Positive Global Cues & Better Prospect Of BJP In GJ After “Patidar” Gr Revolts Against INC



Market Wrap: 07/12/2017 (17:00)

NSE-NF (Dec):10207 (+138; +1.37%) 

(TTM PE: 26.00; Abv 2-SD of 25; TTM Q1FY18 EPS: 391; NS: 10167; Avg PE: 20; Proj FY-18 EPS: 418; Proj Fair Value: 8360)

NSE-BNF (Nov):25188 (+261; +1.05%) 

(TTM PE: 28.90; Near 3-SD of 30; TTM Q1FY18 EPS: 867; BNS: 25057; Avg PE: 20; Proj FY-18 EPS: 961; Proj Fair Value: 19220)

For 08/12/2017: Dec-Fut

Key support for NF: 10205-10160/10110

Key resistance for NF: 10270-10345/10385

Key support for BNF: 25100-24850/24750

Key resistance for BNF: 25250-25500/25750

Trading Idea (Positional):

Technically, Nifty Fut-Dec (NF) has to sustain over 10270 area for further rally towards 10345-10385 & 10435-10475 zone in the short term (under bullish case scenario). 

On the flip side, sustaining below 10250 area, NF may fall towards 10205-10160 & 10110-10040 zone in the short term (under bear case scenario).

Technically, Bank Nifty-Fut (BNF) has to sustain over 25300 area for further rally towards 25500-25750 & 25875-26050 zone in the near term (under bullish case scenario).

On the flip side, sustaining below 25250 area, BNF may fall towards 25100-24850 & 24750-24600 area in the near term (under bear case scenario).

Indian market (Nifty-Fut/India-50) today (7th Dec) closed around 10207, soared by almost 138 points (+1.37%) tracking positive Global cues and supported by bargain hunting/short covering after almost 3.5% correction from recent top (an expected hawkish hold by RBI yesterday) coupled with sudden brightening prospect of BJP in GJ; it made closing session high of 10218 & an opening minutes low of 10079.

Market today soared further in late trade on reports that 6 “Patidar” groups (caste) oppose INC’s reservation formula in GJ, terming it as “unconstitutional”. GJ is a highly fragmented state on caste & creed (religion); the party which can gain supports of such groups may benefit most in the coming election. In that sense, market is relieved that INC may not get the supports of all the “Patidar” groups as earlier assumed and thus BJP may gain immensely.

After market hours today, GJ political narrative heats up again with some alleged “Neech” (low) comments by a Senior Cong Leader (Ayer) against NAMO and subsequently INC suspended Ayer. As NAMO is immense popular in GJ and was the CM for almost two terms, any personal campaign against NAMO will be bad for INC and after this incident, INC may lose some support, which was built up in the last few months by RAGA as a result of hard campaigning against real issues of DeMo, GST & unemployment blues.

Election outcome from GJ this time may be looked as a verdict for DeMo & GST issues, which in turn will help to shape the future course of structural reforms in India & political landscape.

Now, RBI event is over, Indian market will be driven by global cues & GJ election outcome, PSBS recaps, various trial-balloons related to FY-19 budget proposals before Q3 earnings season arrives. 

Today Nifty was supported mostly by ICICI Bank, Bharti Airtel, Maruti, L&T, Gail, Bharti Infratel, Asian Paints, Infy, UPL & Bosch by almost 55 points cumulatively.

Nifty was dragged mostly by TCS, Wipro, Cipla, Coal India & Sun Pharma by only around 4 points altogether.

Overall, today Indian market was supported by banks & financials, auto, FMCG, mixed techs, media, metals, reality, energies, infra & telecom (buzz of M&A in South Africa), while dragged by selected techs & pharma.






SGX-NF


BNF


WTI

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