Friday, 1 December 2017

Nifty Tumbled On Macro Worries Despite Stable Global Cues



Market Wrap: 30/11/2017 (17:00)

NSE-NF (Dec):10278 (-121; -1.17%) 

(TTM PE: 26.09; Abv 2-SD of 25; TTM Q1FY18 EPS: 392; NS: 10227; Avg PE: 20; Proj FY-18 EPS: 418; Proj Fair Value: 8360)

NSE-BNF (Nov):25469 (-397; -1.53%) 

(TTM PE: 28.85; Near 3-SD of 30; TTM Q1FY18 EPS: 878; BNS: 25332; Avg PE: 20; Proj FY-18 EPS: 961; Proj Fair Value: 19220)

For 01/12/2017: 

Key support for NF: 10240/10220-10190/10150

Key resistance for NF: 10290/10310-10365/10425

Key support for BNF: 25400-25200

Key resistance for BNF: 25750-25875

Trading Idea (Positional):

Technically, Nifty Fut-Dec (NF) has to sustain over 10310 area for further rally towards 10365-10425 & 10485-10540 zone in the short term (under bullish case scenario). 

On the flip side, sustaining below 10290 area, NF may fall towards 10240-10190 & 10150-10080 zone in the short term (under bear case scenario).

Technically, Bank Nifty-Fut (BNF/BNS) has to sustain over 25750 area for further rally towards 25875-26000 & 26100-26325 zone in the near term (under bullish case scenario).

On the flip side, sustaining below 25700 area, BNF may fall towards 25400-25200 & 25050-24700 area in the near term (under bear case scenario).

Indian market (Nifty Fut/India-50) today (30thNov) closed around 10278, plunged by almost 121 points (-1.21%) after making an opening session high of 10355 and closing minutes low of 10265; market today opened around 40 points lower on muted global/Asian cues (tech sell off in US) and domestic concern of macro data & IBC/NPA resolution mechanism to GJ election.

After opening weak, Indian market got further weakness but tried to recover after firm opening of EU/German market. But it again succumbed into sharp selling after Govt published terrible fiscal deficit data for Apr-Oct’17 at 96.1% of estimated total fiscal deficit (till March’18). Total fiscal deficit came as Rs.5.25 tln vs 4.2 tln (YOY).

As for the last few years, Indian growth story mainly relies on Govt capex & also greatly on Govt consumption, surging fiscal deficit may force Govt to go on the back foot for incremental capex and it may force to even cut down it.

Surging Oil is another headwind for the Indian economy now; if Brent sustained over $65, then Govt has to roll back its additional ED imposed earlier to give relief to the public, who are already under heavy stress for sky high food/vegetable & others inflation in India, affecting daily life.

After market hours, Indian Q2 GDP came as slightly below expectations at 6.3% vs est 6.4%; prior: 5.7% (QOQ)/7.5% (YOY); it recovers after 5 consecutive quarters of slump much to the relief of the Govt ahead of the GJ election. Although Govt is describing it as victory of structural reforms (DeMo & GST), market may be clearly worried about surging consolidated fiscal deficit, falling revenue and increasing Govt debt.

Industrial output for Oct came as 4.7% vs 5.2% (YOY); all eyes may be now on today Mfg PMI for Nov, which is slated to come as 51 vs prior 50.3.

Today Nifty was supported by BOSCH, Gail, IBULLS HSG, DRL & Bharti Airtel by around 5 points altogether, while it was dragged by RIL, ICICI Bank, HDFC, HDFC Bank, Tata Motors, SBI, Kotak Bank, Axis Bank, ITC & Bajaj Fin by almost 88 points cumulatively.

Overall, today Indian market was supported by property developers while dragged by almost every other sector, mostly banks, auto, FMCG, techs, media, metals, healthcare, energies & consumer staples.






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