Thursday, January 25, 2018

Update on Nifty levels, Bank Nifty levels, and Equity Pick of the day 25th Jan 2018

Update on Nifty levels, Bank Nifty levels, and Equity Pick of the day 25th Jan 2018

Nifty 11086 /Sensex 36161/ Bank Nifty 27398

28 Advances / 22 Declines/ 0 Unchanged

Benchmarks manage to eke out slender gains

Indian equity benchmarks managed to end the extremely volatile day of trade with modest gains on Wednesday, with frontline gauges holding their crucial 11,050 (nifty) and 36,100 (Sensex) levels. Markets altered between green and red throughout the session and somehow managed to end with slender gains, as traders took some encouragement with former Niti Aayog vice chairman Arvind Panagariya’s statement that India has the potential to achieve 10% growth rate, but it needs major reforms in areas in labour laws and land acquisition. He said Indian economy grew 7.5% in the first three years of the Narandra Modi government, but two major reforms - demonetisation and goods and services tax - brought the growth rate down a little. Some support also came with Prime Minister Narendra Modi showcasing India’s growth story to world leaders and called out for tackling the three major challenges the world faces currently - climate change, terrorism and threat to globalisation. Meanwhile, expressing confidence about the economy’s potential, Finance Minister Arun Jaitley hoped that it would become the third largest economy over the next 25 years. He said, “We have moved from the seventh to the fifth largest economy. Unquestionably in the next 25 years India would perhaps be the largest economy”.

However, gains remained capped as traders remained mostly on sidelines ahead of January derivatives expiry on Thursday and ahead of the Union Budget next week. Traders also remained concerned with global rating agency, S&P ratings’ latest report ‘APAC Economic Snapshots, January 2018’, which stated that overall economic risks in India remain low, but risks from higher oil prices have reappeared. International oil prices have been rising which has also led to increased prices of petrol and diesel and a majority of India’s import bill stem from crude oil purchases.

Weak opening in European markets too dampened domestic sentiments with investors focusing on a batch of euro zone economic reports set to be released. The jobless rate in the UK was unchanged as expected at a prior 42-year low in November, while wage inflation excluding bonuses unexpectedly ticket higher. Asian markets exhibited mixed trend on news of US tariffs on washing machines and sonar panels sparked fears of a global trade war.
Back home, shares of public sector banks (PSBs) ended higher for the second straight day on expectations of PSU recap bond allocation to happen before the Budget. 

However, telecom stocks like Bharti Airtel and Idea Cellular closed in red, a day after Reliance Jio offered 500 Mb more data at the same price points, underlining the continuing tariff war which will hurt average revenue per user further. The industry, already plagued by tariff wars and debt of Rs 5 lakh crore has had another poor quarter. Shares of liquor companies remained under pressure with United Spirits falling around 7% on BSE in intra-day trade after reporting disappointing set of numbers for the quarter-ending December 2017 (Q3FY18).

FII’s Activity 24th -Jan-18

The FIIs as per Wednesday’s data were net buyers in equity and debt segments both, according to data released by the NSDL.

In equity segment, the gross buying was of Rs 8416.66 crore against gross selling of Rs 5935.20 crore. Thus, FIIs stood as net buyers of Rs 2481.46 crore in equities.

In the debt segment, the gross purchase was of Rs 2721.13 crore with gross sales of Rs 1079.94 crore. Thus, FIIs stood as net buyers of Rs 1641.19 crore in debt.

In the hybrid segment, there was no buying against gross selling of Rs 11.17 crore. Thus, FIIs stood as net sellers of Rs 11.17 crore in hybrid.

Now what to expect ??

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Nifty Levels 

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Above 11130 will see rally till 11230---11280 mark else could touch its support level of 10900 again

Trade with levels only 

Bank Nifty 

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Support at 27000 and Resistance at 27500

Above 27500 will see rally till 27800---28050 mark else could touch its support level of 27000 again

Union Bank of India- Top Pick

According to bollinger bands, unionbank is technically strong.

Now what to expect???

On Daily chart, Hurdle at 151 will see rally till 160--165 in weeks to come.

Support intact at 142.
Any sharp downside panic will be buying opportunity in it.

Trading Recommendation (25th Jan 2018)

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Buy Union Bank above 151 with stop loss below 142 (on a closing basis) Target 160---165.

Corporate Action-Ex date

Siemens Limited-Dividend- Rs 7/- Per Share

Results Today

Dr. Reddy's Laboratories Limited

UPL Limited

Maruti Suzuki India Limited

LIC Housing Finance Limited

Jindal Steel & Power Limited

L&T Finance Holdings Limited

Ajanta Pharma Limited

More Will Update Soon!!