Nifty 9765 /Sensex 31291/ Bank Nifty 23974
29 Advances / 22 Declines/ 0 Unchanged
Benchmarks eke out slender gains from a choppy session
Indian equity benchmarks ended the choppy day of trade with marginal gains, where frontline gauges, despite some hiccups, managed to keep their head above water, as traders opted for bargain hunting after registering losses in the preceding two trading sessions. Markets traded mostly in green through the session with traders taking support with DIPP’s report that FDI flow into the country grew 37% to $10.4 billion during the first quarter of this financial year. India received $7.59 billion FDI during April-June 2016-17. Some support also came with foreign brokerage firm’s report that India is expected to see a modest recovery in GDP growth at 6.6% for the April-June quarter as compared to 6.1% in January-March, which was affected by demonetization. Meanwhile, Prime Minister Narendra Modi is slated to interact with 200 CEOs to attain their views and suggestions to carry forward the 'New India' initiative. The two-day discussion involves groups consisting of around 35 industry leaders and government secretaries, who will deliberate on an array of topics, namely- New India by 2022, Make in India, Cities of Tomorrow, World Class Infrastructure, Doubling Farmers Income and Fixing Finance: Reporting the Financial Sector.
However, gains remained capped as some cautiousness crept in on report that leading stock exchange BSE announced on Monday that it will ‘compulsorily’ delist 200 firms this week and bar their promoters from the markets for 10 years as trading in these shares have remained suspended for over a decade. All these companies will be delisted from August 23. Traders also remained concerned with a private survey stating that consumer confidence in India declined in the second quarter of this year amid concerns regarding job security and lower optimism on employment prospects.
Strong leads from global markets too provided much needed support to domestic sentiments with European markets making a positive start ahead of the annual central banking conference in Jackson Hole later this week. Morale among German investors deteriorated for a third consecutive month in August. Asian markets ended mostly in green. Malaysia’s consumer price index likely rose 3.3% in July from a year earlier, a poll showed, slowing in pace for the fourth month in a row.
Back home, investors also took note of foreign brokerage firm’s report that retail inflation is likely to stay well within the RBI’s 2-6% mandate in the coming months and accordingly, the central bank is expected to cut policy rates by 25 bps on December 6. The report enlightened that inflationary pressures are expected to remain contained by good rains, low growth and subdued imported inflation amid decrease in global commodity prices. On the sectoral front, stocks related to oil & gas sector remained buzzing, as the government clarified
that upstream oil and gas companies can avail an input tax credit (ITC) on Goods and Services Tax paid only on the value added products that are manufactured and covered under GST.
FII’s Activity 22-Aug-17
The FIIs as per Tuesday’s data were net sellers in equity segment, while they were net buyers in debt segment, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 4312.11 crore against gross selling of Rs 6101.47 crore. Thus, FIIs stood as net sellers of Rs 1789.36 crore in equities.
In the debt segment, the gross purchase was of Rs 1781.12 crore with gross sales of Rs 491.28 crore. Thus, FIIs stood as net buyers of Rs 1289.84 crore in debt.
Now what to expect??
Nifty Levels
Close above 9850 will see upside rally till 9920---9950 and then to 10050 marks else it could test its support level of 9730 again.
Below 9730 will see more downside panic till 9690---9650 mark. Trade with levels only
Daily Derivative Outlook 23rd August
• Nifty August 2017 futures closed at 9794.00 on Tuesday at a premium of 28.55 points over spot closing of 9765.55.
• Maximum Call writing was seen at 9950 and maximum put writing seen at 9400 and maximum option buying (unwinding by option writers) was seen at 9800 PE and 9800 CE strike.
• Maximum positions are at 10000 CE and 9800 PE.
• MOTHERSONSUMI (12%), ICIL (9%), DLF (9%), APOLLOHOSP (7%) and DHFL (7%) were the top open interest gainers in the market.
• HEXAWARE (-10%), GODFRYPHLP (-7%), FORTIS (-7%), AJANTPHARM (-6%) and BEML (-5%) were the top losers in open interest in the market.
• The Nifty Put Call Ratio (PCR) finally stood at 0.95 for August month contract.
• Advance Decline ratio in F&O segment was at 0.54, Advance (76) + Decline (142) + Unchanged (2) = 219
Derivative Idea (23-08-2017)
Ashokley losses 1.08% of open interest as short build-up. It is trading near support level of 99.00. Ashokley is forming head and shoulder pattern on daily chart having breakout point at 99.00 and also trading below its 21 and 55 DEMA while RSI showing negative divergence which indicates downside is certain in it.
Now what to expect??
Break and sustain below 99 will take it to 92---88 and then to 85 mark in days to come.
Hurdle and stop loss above 107.00
Current chart pattern and derivatives data suggest that we expect further panic in coming sessions.
Trading Recommendation(23-Aug-17)
Sell Ashokley (AUG) future below 99.00 Stop loss 107.20(on closing basis) Target 90.00—88.00 and then to 85.00
Rec Ltd- Top Pick(23-Aug-17)
CMD of REC said private sector exposure is at 14 percent of the total portfolio.
Company has the lowest non-performing asset (NPAs) amongst all the financing companies, he said.
He further said that restructured book comprises of projects that are delayed in commissioning.
According to bollinger bands, recltd has recently hit the lower band which is a negative signal.
MACD showing negative momentum which indicates that downside side seems certain in it.
Price just got below it's 200-day simple moving average which is a negative signal. According to simple moving average analysis, recltd is in a downtrend.
Now what to expect???
Break and sustain below 152 will see downside panic till 142---140++ mark in days to come.
Looks bullish only if close above 163 marks.
Any sharp upside rally will be selling opportunity in it.
Trading Recommendation (23rd August 2017)
Sell REC Ltd below 152 with stop loss of 163 (on a closing basis) Target 142---135+++.
Corporate Action
Aurobindo Pharma Limited- Annual General Meeting
Granules India Limited-Annual General Meeting/Dividend - Re 0.25 per Share (Book Closure Dates Revised)
Pidilite Industries Limited-Annual General Meeting/Dividend - Rs 4.75 per Share
Result Today
Castrol India Limited
More Will Update Soon!!
