Nifty 9964 /Sensex 32370/ Bank Nifty 24799
4 Advances / 47 Declines/ 0 Unchanged
Markets clobber out of shape on geopolitical concerns; Nifty breaches 10k mark
Indian equity benchmarks witnessed absolute carnage on Friday and went home with a cut of around one and a half percent, breaching their crucial 32,000 (Sensex) and 10,000 (Nifty) levels. After a gap-down opening, markets never looked confident of recovering and gradually extended their losses till end to close near intraday lows on renewed geo-political worries after a report that North Korea could respond to fresh sanctions with a hydrogen bomb in the Pacific. Back on domestic turf, sentiments remained dampened on expectations that the government’s plan for a stimulus to halt an economic slowdown may have a negative impact on the fiscal deficit. Market participants also remained concerned with report that the Organization for Economic Co-operation and Development (OECD) trimmed India’s growth forecast for the current financial year, citing the temporary impact of the rollout of the Goods and Services Tax (GST) and demonetization, expecting the economy to expand at a slower pace than China. OECD said India’s economy will likely grow 6.7% in FY18, lower than its estimate 7.3% in June. The Paris-based group of 35 advanced and emerging countries cut its forecast for India’s growth to 7.2% in FY19 from 7.7% estimated earlier.
Meanwhile, traders failed to get any sense of relief with report that the government is considering a plan to loosen the fiscal deficit target so that it could spend an additional Rs 500 billion ($ 7.7 billion) in the financial year ending in March 2018. Traders also paid no heed to reports that given the lack of considerable space both on the monetary and fiscal front to support economic growth, part of the country’s forex reserves can be used to support GDP numbers.
Firm trade in European counters too failed to pull markets out of woods as CAC, DAX and FTSE were trading in green ahead of this weekend’s general election in Germany, where conservative Chancellor Angela Merkel is expected to win a fourth term. Asian markets closed mostly in red. S&P Global Ratings cut Hong Kong’s credit rating a day after it downgraded China for the first time since 1999, a move that reflects the strong institutional and political linkages between the special administrative region and the mainland.
Closer home, investors took note of a report that a slowdown in growth is likely to create pressure on the government to announce an economic stimulus package. But it could have an adverse impact on near-term macroeconomic stability. Besides, there could be long-term implications on growth, the way it happened with the 2008-09 fiscal stimulus package. On the sectorial front, infra sector stocks edged lower despite Government’s 100 smart cities mission seeking to invest over $15 billion in the next few years to build efficient and effective city management solutions and infrastructure.
FII’s Activity 25th-Sept-17
The FIIs as per Friday’s data were net sellers in equity and debt segments both, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 4890.30 crore against gross selling of Rs 5939.73 crore. Thus, FIIs stood as net sellers of Rs 1049.43 crore in equities.
In the debt segment, the gross purchase was of Rs 276.09 crore with gross sales of Rs 420.67 crore. Thus, FIIs stood as net sellers of Rs 144.58 crore in debt.
Now what to expect???
Nifty Levels
We clearly indicating Nifty looks negative below 10150 mark, its crashed vertically and made low of 9975.
Now what to expect???
Below 9950 will see more downside panic till 9880---9850 and then to 9700 mark else it could test its resistance level of 10080---10150 again which is unlikely for time being.
Major hurdle at 10200
Daily Derivative Outlook 25th September 2017
• Nifty September 2017 futures closed at 9982.95 on Friday at a premium of 18.55 points over spot closing of 9964.40.
• Maximum call writing seen at 10000, Maximum put writing seen at 10100.
• Maximum positions are at 10200 CE and 9900 PE.
• HCC (35%), RELCAPITAL (22%), CANBK (20%), OIL (16%) and UNIONBANK (13%) were the top gainers in open interest in the market.
• TORNTPHARM (-10%), DIVISLAB (-10%), WOCKPHARMA (-8%), NIITECH (-8%) and BATAINDIA (-7%) were the top losers in open
Interest in the market.
• The Nifty Put Call Ratio (PCR) finally stood at 0.95 for September month contract.
Derivative Idea (21-09-2017)
Canara Bank gain around 20.00% of open interest as short build up on Friday’s trade. It has also breach its immediate support level of 328.00 on the lower side with noticeable rise in volume. Canara Bank forming symmetrical triangle on daily chart.
Now what to expect??
Support at 325, Break and sustain below 325.00 will take it to 280--250 and then to 220++ mark in days to come.
Hurdle and stop loss above 355.00
Current chart pattern and derivatives data suggest that we expect further panic in coming sessions.
Trading Recommendation
Sell Canara Bank future below 328.00 Stop loss 355.00 on closing basis) Target 280.00—250.00.
More Will Update Soon!!
