Nifty 9852 /Sensex 31568/ Bank Nifty 24316
36 Advances / 15 Declines/ 0 Unchanged
Benchmarks extend gains for second day; Nifty reclaims 9,850 mark
Wednesday turned out to be a fabulous day of trade for Indian Equity benchmarks, with frontline gauges recapturing their crucial 31,500 (Sensex) and 9,850 (Nifty) levels. Sentiments remained up-beat since morning, as markets made a gap-up opening with a blog on Asian Development Bank’s website, stating that the Goods and Services Tax (GST) in India will benefit the lower and lower-middle income class as it is likely to reduce the tax rate on goods. It further stated that in general, GST is likely to reduce the tax rate on goods as compared to previously, while tax rates on services are expected to increase. Afterwards, markets traded with confidence in a tight band for most part of the session with traders taking encouragement with the Financial Stability & Development Council’s (FSDC) statement that India has macro-economic stability today on the back of improvement in its macro-economic fundamentals and structural reforms with the launch of the GST. The Council, comprising regulators, took note of the overall stability that has been achieved on the back of improvements in macro-economic fundamentals, structural reforms with the launch of the GST, action being taken to address the twin balance sheet challenge and financial market confidence.
Markets extended gains in the last leg of trade which mainly helped markets to end near intraday high levels, as some support came with the report that the loan portfolio of microfinance institutions (MFIs) increased by 26% to Rs 35,045 crore in the first quarter ended June 2017. Some support also came with the launch of the Mentor India Campaign, a strategic nation building initiative to engage leaders who can nurture and guide students at more than 900 Atal Tinkering Labs.
On the global front, European markets were trading in red in early deals amid sharp declines in advertising giant WPP after it cut sales forecasts on weakening demand. Markets also shrugged off a PMI survey showing eurozone manufacturing businesses had their best month of growth in six and a half years in August. Asian markets exhibited mixed trend ahead of Jackson Hole, Wyoming conclave of central bankers this week that could provide fresh insight into policy options.
Back home, investors shrugged off rating agency ICRA’s latest report which has estimated that India’s gross value added (GVA) growth is likely to slow down to 6.3% in April-June quarter (Q1) of the fiscal year 2017-18 from 7.6% in the same period of the previous year. On the sectoral front, PSU banks remained on buyers’ radar after the Cabinet approved setting up of an alternative mechanism for the merger of public sector banks. Telecom stocks remained buzzing, as the Inter-Ministerial Group (IMG) on the telecom industry hinted on extending the timeline for deferred spectrum payment by telcos to 16 years instead of 10 at present. In scrip specific development, Infosys edged higher on a report that Nandan Nilekani is likely to re-join the company as the head. The clarity on Nilekani’s role is expected in the next 48 hours. The developments come a few hours after Narayana Murthy postponed his conference call with Infosys investors citing health issues.
FII’s Activity 23-Aug-17
The FIIs as per Wednesday’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 3474.55 crore against gross selling of Rs 4202.18 crore. Thus, FIIs stood as net sellers of Rs 727.63 crore in equities.
In the debt segment, the gross purchase was of Rs 2215.10 crore with gross sales of Rs 1086.46 crore. Thus, FIIs stood as net buyers of Rs 1128.64 crore in debt.
Now what to expect??
Above 9850 will see upside rally till 9920---9950 and then to 10050 marks else it could test its support level of 9780 again.
Close below 9780 will see more downside panic till 9750---9620 mark.
Trade with levels only.
Daily Derivative Outlook 24th August
• Nifty (Aug) futures closed at a Premium of 9.80 points versus premium of 14.25 points.
• Maximum put writing seen at 9900 and maximum option buying (unwinding by option writers) was seen at 9800 PE and 9800 CE strike.
• Maximum positions are at 10000 CE and 9600 PE.
• SIEMENS (33%), KAJARIACER (24%), CONCOR (19%), BALKRISIND (18%) and INDIGO (11%) were the top gainers in open interest in the market.
• CEATLTD (-9%), UBL (-9%), DLF (-8%), NIITTECH (-7%) and LICHSGFIN (-7%) were the top losers in open interest in the market.
• The Nifty Put Call Ratio (PCR) finally stood at 1.18 for the August month contract.
• Advance Decline ratio in F&O segment was at 0.54, Advance (185) + Decline (33) + Unchanged (1) = 219
Derivative Idea (24-08-2017)
Canara Bank losses 6.70% of open interest as Short Covering. It is trading near resistance level of 329.50. Canara Bank is forming double bottom pattern on hourly chart having breakout point at 329.50.
Now what to expect??
Break and sustain above 330 will take it to 342---345 and then to 360+++ mark in days to come.
Hurdle and stop loss below 322.00.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation(24-Aug-17)
Buy Canara Bank (AUG) future above 329.50 Stop loss 322(on closing basis) Target 342--345 and then to 360++
DHFL- Top Pick(24-Aug-17)
RSI is 54.6. According to RSI analysis, dhfl is marginally strong.
According to simple moving average analysis, dhfl is in a strong uptrend.
The day ended with 4,611,259 stocks that were traded and along with this the 5 day, 10day & 30 day average volumes were observed to be 3,490,375 , 2,892,889 , and 2,421,399 respectively.
The 5 day average volume rose 516757 stocks, 10 day average volume rose 340903 stocks and 30 day average volume rose 150981 stocks as compared to the previous day.
In the last 52 weeks the lowest price observed was Rs. 213.70 while the highest price was Rs. 478.65.
Now what to expect???
Break and sustain above 473 will see upside rally till 480---485++ mark in days to come.
Looks bearish only if close below 465 marks.
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (23rd August 2017)
Buy DHFL above 473 with stop loss of 465 (on a closing basis) Target 480---485+++.
Corporate Action
Maruti Suzuki India Limited-Dividend - Rs 75/- Per Share
The India Cements Limited- Annual General Meeting/Dividend - Re 1/- Per Share
More Will Update Soon!!
