Nifty 9978 /Sensex 32014/ Bank Nifty 24599
14 Advances / 37 Declines/ 0 Unchanged
SEBI’s scanner on shell companies drag benchmarks lower; Nifty breaches 10k mark
Tuesday turned out to be a disappointing day of trade for Indian equity benchmarks, with Nifty and Sensex breaching their crucial 10,000 and 32,100 levels, respectively, after Securities and Exchange Board of India (SEBI) directed bourses to initiate action against 331 suspected shell companies that are listed and these scrips will not be available for trading this month. The regulators directive came after the Corporate Affairs ministry shared a list of 331 listed companies that are suspected to be shell entities and could even face compulsory delisting. Markets started the session with optimism but it soon fizzled out and both the domestic indices entered into red terrain, as traders turned cautious with the private report stating that it ‘suspects’ that there has been a change in the stance by the authorities to let the rupee appreciate more, but warned that it can hurt manufacturing and exports. Some concerns also came with Engineering exporters’ body EEPC stating that shipping companies are facing difficulties post GST as their drawback refunds will not be released till September-end or October. Meanwhile, the securitisation market has hit a record high of $1.02 trillion in fiscal 2017, helped by a surge in volume of pass-through certificates (PTCs).
Traders failed to get any sense of relief with Central Board of Direct Taxes’ (CBDT) report of a 25 percent increase in the number of Income Tax Returns (ITRs) filed in the current fiscal, on the backdrop of economic reform, including demonetisation and the Income Tax Department’s (ITD) Operation Clean Money. Traders also failed to get any solace with SEBI allowing brokers to offer a margin funding facility that does not mandate clients to bring cash upfront to initiate a leveraged trade. Investors can now buy shares by pledging their stock portfolio with stock brokers.
Weak opening in European counters too dampened sentiments with major indices trading flat in early deals, as investors remained focused on a new round of earnings reports. Lower-than-expected exports and imports figures in China too weighed sentiments. Asian markets closed mixed, with early yuan figures from China on trade failing to lift sentiments.
Back home, selling in Realty counter dampened sentiments with stocks remained under immense pressure after banks in consultation with the RBI, have decided not to extend loans to those projects which have not been registered under RERA. Banks have also sought additional collateral, including on personal properties of promoters, as guarantees while disbursing loans to a few real estate developers. Stocks related to auto space too edged lower after GST council yesterday approved the proposal to hike cess on SUVs, mid-sized, large and luxury cars to 25%, from 15%. Also, hybrid vehicles with engine capacity of more than 1500 cc and mid segment hybrid cars of less than 1500 cc fall in the category.
FII’s Activity 8-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 3834.07 crore against gross selling of Rs 4000.39 crore. Thus, FIIs stood as net sellers of Rs 166.32 crore in equities.
In the debt segment, the gross purchase was of Rs 1826.47 crore with gross sales of Rs 581.85 crore. Thus, FIIs stood as net buyers of Rs 1244.62 crore in debt.
Now what to expect??
Nifty Levels
Support at 9950 and resistance at 10080---10150
Close below 9950 will take to 9880---9830 and then to 9700 mark else it could test it's resistance again
Fresh buying can do only close above 10150 mark
Daily Derivative Outlook 09th August
• Nifty (Aug) futures closed at a Premium of 20.90 points versus a Premium of 34.35 points.
• Call Writing was seen at 10100 Strike and Put writing was seen at Nifty 9800 and max put buying (unwinding by option writers) was seen at 10100 and 10000 strike.
• Maximum positions are at 10200 CE and 10000 PE. Nifty expected trading range spread to 10500—10000.
• MRPL (19%), MGL (15%), HINDALCO (13%), NATIONALALUM (12%) and CIPLA (12%) were the top gainers in open interest in the market.
• PCJEWELLER (-17%), APOLLOTYRE (-13%), BERGERPAINT (-12%), HDIL (-12%) and KSCL (-11%) were the top losers in open interest in the market
• The Nifty Put Call Ratio (PCR) finally stood at 0.93.
• Advance Decline ratio in F&O segment was at 0.19, Advance (35) + Decline (184) + Unchanged (0) = 219
Derivative Idea (09-08-2017)
DCB Bank gain around 9.00% of open interest as short build-up on Tuesday’s trade.
Support 184. Below 184 panic remain continue till 178--175 and then to 168++ mark.
Hurdle and stop loss above 192.00
Current chart pattern and derivatives data suggest that we expect further panic in coming sessions.
Trading Recommendation
Sell DCB Bank (AUG) future below 184.00 Stop loss 192.00(on closing basis) Target 178--175 and then to 168
Corporate Action
Balrampur Chini Mills Limited- Annual General Meeting/Dividend
Results Today
Tata Motors Limited
NMDC Limited
NHPC Limited
National Aluminium Company Limited
Mahanagar Gas Limited
Max Financial Services Limited
Engineers India Limited
Eicher Motors Limited
Aurobindo Pharma Limited
Ajanta Pharma Limited
Bharat Forge Limited
More Will Update Soon!!
