Market Wrap: 06/02/2018 (17:00)
NSE-NF (Feb):10534 (-151; -1.41%)
(NS: 10498; Q2FY18 EPS: 391; Q2FY18 PE: 26.85; Abv
2-SD of 25; Avg FWD PE: 20; Proj FY-18 EPS: 418; Proj Fair Value: 8360)
NSE-BNF (Jan):25920 (-276; -1.05%)
(BNS: 25811; Q2FY18 EPS: 867; Q2FY18 PE: 29.77; Abv
3-SD of 30; Avg FWD PE: 20; Proj FY-18 EPS: 961; Proj Fair Value: 19220)
For 07/02/2018: Feb-Fut (Key Technical Levels)
Updated: 07:25 (SGX-NF: 10618);
+84 points (+0.80% on positive global
cues)
Support for NF: 10580/10560*-10510/10480
Resistance for NF: 10655/10685*-10755/10785
Support for BNF: 25900/25700-25400/25250
Resistance for BNF: 26250/26400-26575/26800
Trading Idea (Positional):
Technically, Nifty
Fut-Jan (NF) has to sustain over 10685 area for further rally towards 10755/10785-10825-10895
& 10935-10990 zone in the short term (under bullish case scenario).
On the flip
side, sustaining below 10655 area, NF may fall towards 10580/10560-10510/10480
& 10430-10390 zone in the short term (under bear case scenario).
Technically, Bank
Nifty-Fut (BNF) has to sustain over 26250 area for further rally towards 26400-26575
& 26800-27000 zone in the near term (under bullish case scenario).
On the flip side, sustaining
below 26200 area, BNF may fall towards 26100/25900-25700 & 25400-25250 area
in the near term (under bear case scenario).
Indian market (Nifty Fut-Feb/India-50) today (6th
Feb) closed around 10534, tumbled by almost 151 points
(-1.41%) as global euphoria turned into dysphoria; “goldilocks” equity rally
stumbled on scare of higher inflation & higher rates & anti-VIX ETF panic
(XIV ETF fiasco in US market) coupled with domestic issues of higher fiscal
deficit & LTCGT (long term capital gain tax) and a high probable hawkish
RBI.
Indian market today opened around 10318 on
terrible global cues & made the session low at 10300, but recovered quite smartly
after some recovery in US stock future on the back of bounce back in EU &
HK market; it made a day high of almost 10614 on huge short covering, but
slipped again in a day of extreme & sharp volatility; DII (LIC-India’s
plunge protection team) support to the market heavyweights was quite visible as
government vowed to protect the interest of the investors.
Indian 10YGSEC bond yield closed around 7.57% as
bond market is concerned over fiscal slippages. Government has also indicated
that due to tight fiscal position, there is no headroom for further cut in
excise duty/cess on Petrol & Diesel; Government will not change its LTCGT
plan and is expecting good advance tax collections for Q3FY18; USDINR-I closed
0.26% higher. As par government version, present Indian market meltdown is
entirely due to global sell off and LTCGT issue should not be blamed for that.
All eyes will be now on RBI, which is expected to
be on a hawkish hold stance; but Patel/MPC has to balance his jawboning amid
surging fiscal deficit, higher inflation and higher Indian bond yields. Any
definitive signal of rate hikes in the coming months may also doom the market.
Overall, apart from terrible global cues &
higher bond yields, pessimism over a politically populist budget, fiscal
deficit breach, and gradual shift of FII trading from Indian to Singapore (SGX)
due to regulation & high taxation issues and a weak INR may be responsible
for overall bloodbath in the Indian market; overall Q3 report card may be also
termed as mixed till now, but not justifiable for the stretched valuation.
Overall, Indian market today was dragged by almost
all the sectors like banks & financials, automakers, FMCG, techs, media,
metals, pharma. Reality, infra & energies, while helped by selected private
bank (ICICI) & Eicher motor.
SGX-NF
BNF
USDJPY
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