Nifty 9917 /Sensex 31730/ Bank Nifty 24318
30 Advances / 21 Declines/ 0 Unchanged
Buying in late trade takes Nifty above 9,900 mark; Sensex reclaims 31,700 level
Bulls which woke up in last leg of trade mainly helped benchmarks to end near intraday highs on the F&O series expiry day, recapturing their crucial 31,700 (Sensex) and 9,900 (Nifty) levels. Though, markets made a cautious start and extended their fall, as traders remained on sidelines ahead of Gross Domestic Product (GDP) figures to be announced later in the day. Investors also remained concerned with assessment of RBI in its annual report that fiscal consolidation may come under threat at the central and state levels due to the immediate effects of the goods and service tax (GST), loan waivers and pay revisions, putting pressure on the overall growth matrix. However, markets took U-turn and showed strength to enter into green terrain in afternoon deals with traders taking some encouragement with Finance Minister Arun Jaitley’s statement that the GST is bound to impact the direct tax collection as well due to the increased detection technology and greater compliance. The Finance Minister also said that even before GST was rolled out, the impact of demonetization has expanded the number of assesses under the personal income tax.
Markets extended gains in last leg of trade to end near high point of the day, as some support came with Moody’s Investors Service’s statement that in the near term, the economy will continue to recover from the temporary liquidity shock from demonetization, while adjusting to the new GST. Moody’s further said that though the indicators like net new nonperforming loan (NPL) formation and problem loan ratios suggest a bottoming of the credit cycle, deteriorating asset quality in agriculture, and micro, small- and medium-sized enterprise (MSME) portfolios pose risks.
Firm opening in European markets too aided sentiments ahead of the release of euro zone inflation data due later in the trading session. Asian markets ended mixed on Thursday. Japanese market ended higher despite its industrial production slowing in July from June, as continued strong exports and a cheap yen indicated that the phase is temporary.
Back home, a global financial service major enlightened that India’s economic growth is likely to remain soft and the GDP is expected to grow by 6% in April-June, down from 6.1% in the preceding quarter. The report added that higher private consumption and government spending is likely to be dulled by weak investment and exports growth over the quarter. On the sectoral front, auto stocks remained buzzing with the Union Cabinet’s approval of promulgation of an Ordinance that would allow the GST Council to hike the maximum rate of compensation cess on large and luxury vehicles to 25% from the current cap of 15%. However, banking stocks ended in red despite global credit rating agency, Moody’s Investors Service said that its outlook on India’s banking system is stable, in line with the stable outlooks for 10 of the 15 banks which it has rated, reflecting stable view of operating environment.
FII’s Activity 31-Aug-17
The FIIs as per Thursday’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 4222.48 crore against gross selling of Rs 4124.26 crore. Thus, FIIs stood as net buyers of Rs 98.22 crore in equities.
In the debt segment, the gross purchase was of Rs 831.57 crore with gross sales of Rs 121.64 crore. Thus, FIIs stood as net buyers of Rs 709.93 crore in debt.
Now what to expect??
Nifty Levels
Above 9950 will see upside rally till 9980 - 10050 and then to 10170 marks else it could test its support level of 9850 again.
Close below 9850 will see more downside panic till 9800---9760 and then to 9700 mark.
Trade with levels only.
Daily Derivative Outlook 1st September 2017
• The Nifty September 2017 futures traded at 9941.80, a premium of 23.90 points compared with Nifty's spot closing of 9917.90 in the cash market. The August 2017 F&O contracts expired yesterday, 31 August 2017.
• Maximum call writing seen at 10000, Maximum put writing seen at 9700.
• Maximum positions are at 10000 CE and 9700 PE.
• Long build up: JUSTDIAL (293.8), ZEEL (175.5%) PVR (155.7%), Hindalco (143%) TITAN (134%)
• Short build up: INFIBEAM (1128%), INFRATEL (228.5%), BRITANNIA (175.5%), BEL (157.1%) and M&M (122.1).
• The Nifty Put Call Ratio (PCR) finally stood at 1.05 for September month contract.
• Advance Decline ratio in F&O segment was at 1.49, Advance (221) + Decline (7) + Unchanged (1) = 219
Derivative Idea (01-09-2017)
National Aluminium gain around 117.9% of open interest as long build up on Thursday’s trade. It has also breached its immediate resistance level of 71.5 on the upper side with noticeable rise in volumes of 114%.
Now what to expect??
Hurdle at 74.00. Break and sustain above 74.00 take it to 80.00—84.00 will and then to 90+++ mark in days to come.
Hurdle and stop loss below 67.00
Current chart pattern and derivatives data suggest that we expect further panic in coming sessions.
Trading Recommendation(01-09-17)
Buy National Aluminium (SEPT) future above 74.00 Stop loss 67.00(on closing basis) Target 80.00—85.00 and then to 90.00++
Manappuram Finance- Top Pick(01-09-17)
As the trading hours came to an end Manappuram Finance was observed to be priced at Rs. 99.3 which was 4.5 points higher than the day's low and 0.45 points lower than the day's high while the day low was Rs. 94.8 and day high was Rs. 99.75 .
With this, 10,104,727 stocks were traded while the 5 day, 10day & 30 day average volumes were observed to be 7,081,786 , 13,385,159 , and 8,524,566 respectively.
The 5 day average volume fell 1461395 stocks, 10 day average volume rose 85144 stocks and 30 day average volume rose 19623 stocks as compared to the previous day.
The price went up to as much as Rs. 110.35 and went down as low as Rs. 57.80 in the last 52 weeks.
Now what to expect???
Break and sustain above 100 will see upside rally till 105---108++ mark in days to come.
Looks bearish only if close below 95 marks.
Trading Recommendation (1st September 2017)
Buy Manappuram Finance above 100 with stop loss of 95 (on a closing basis) Target 105---108+++.
Corporate Action- Ex-date
Jet Airways (India) Limited- ANNUAL GENERAL MEETING
More Will Update Soon!!
