Nifty 9934 /Sensex 31687/ Bank Nifty 24370
17 Advances / 34 Declines/ 0 Unchanged
Benchmarks manage to keep head above water
Indian equity benchmarks some how managed to keep their head above water and went home with slender gains on Friday. Though, markets started the session on optimistic note with report that capital markets regulator, the Securities and Exchange Board of India (Sebi) has proposed compulsory physical settlement in stock derivatives contracts and has sought comments from market participants in a discussion paper, as it is concerned over the suitability of derivatives for retail investors. Soon after the start, optimism got fizzled out and key gauges traded in very tight band, swinging between green and red for most part of the day. Traders turned cautious on report that Sebi imposed an Rs 2,423 crore penalty on PACL and its four directors for illegal fund mobilisation through various schemes that were used by the group to garner over Rs 49,000 crore from the public.
Buying in dying hour of trade helped markets to settle slightly in green, as some support came with private report that emerging as a significant source of investments into capital markets, Employees Provident Fund Organisation (EPFO) is likely to pump in Rs 25,000-30,000 crore in equities in 2017-18 with Rs 5,700 crore already invested this year so far. The report added that National Pension Scheme (NPS) is also among the sources for driving the domestic flow surge, which has been positive for the past 17 months. Traders also get some comfort with a joint report by Ficci and Deloitte which stated that Indian retail industry, growing at 10 percent, may almost double to Rs 85 trillion (lakh crore) by 2021 steered by consumer data and technology disruptions.
On the global front, European counters were trading in red in early deals amid ECB President Mario Draghi’s suggestion that it may begin tapering its massive stimulus programme this autumn continued to underpin the euro. Manufacturing production in the UK rose more than forecast in July, bolstering optimism over the British economy. Asian markets closed mixed, supported by solid Chinese trade data. China’s trade balance data came in at a surplus of $41.99 billion, narrower than the $48.6 billion expected for August.
Back home, investors took note of former RBI Governor Raghuram Rajan’s statement that India needs to focus on three areas -- infrastructure, power and exports -- to stimulate GDP growth, which has been hit by factors like demonetization. Meanwhile, Reserve Bank of India deputy governor Viral Acharya suggested that deposit franchise of state run banks which are in the intensive care unit be sold off to private sector banks as the time may be running out for state-run banks to clean-up their balance sheets and recapitalize.
FII’s Activity 8-Sept-17
The FIIs as per Friday’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 5234.93 crore against gross selling of Rs 5537.58 crore. Thus, FIIs stood as net sellers of Rs 302.65 crore in equities.
In the debt segment, the gross purchase was of Rs 805.55 crore with gross sales of Rs 122.09 crore. Thus, FIIs stood as net buyers of Rs 683.46 crore in debt.
Now what to expect??
Nifty Levels
Above 10020 will see more upside rally till 10080---10150 marks else it could test its support level of 9880 again.
Below 9880 will see more downside panic till 9850---9820 and then to 9700 mark
Daily Derivative Outlook 11th September 2017
• Nifty September 2017 futures closed at 9950.00 on Friday at a premium of 15.20 points over spot closing of 9934.80.
• Maximum call writing seen at 10000, Maximum put writing seen at 9900.
• Maximum positions are at 10000 CE and 9700 PE.
• Long build up: AMARAJABAT (35.30%), OIL (34.8%), KAJARIACER (14.00%), PVR (9.40%) and ASHOKLEY (6.70%) were the top gainers in open interest in the market.
• Short build up: M&M (11.90%), DISHTV (9.6%), UPL (8.5%), LICHSGFIN (8.4%) and ALBK (6.7%) were the top losers in open interest in the market.
• The Nifty Put Call Ratio (PCR) finally stood at 1.16 for September month contract.
Derivative Idea (11-09-2017)
KSCL gain around 4.7% of open interest as long build up on Friday’s trade. It has also breached its immediate resistance level of 556 on the upper side with noticeable rise in volume while it is also trading above 21DEMA on daily chart.
Now what to expect??
Hurdle at 585.00, Above 585.00 rally likely to remain continue till 620--630 and then to 660++ mark in days to come. Further upside rally will see on close above 660.00
Support and stop loss below 555.00
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation(10-09-17)
Buy KSCL(SEPT) future above 585.00 Stop loss 555(on closing basis) Target 620-630 and then to 660++ mark.
Union Bank- Top Pick(10-09-17)
Compared to the previous day the 5 day average volume rose 332292 stocks, 10 day average volume fell 159339 stocks and 30 day average volume fell 51423 stocks.
In the last 52 weeks the lowest price observed was Rs. 116.00 while the highest price was Rs. 205.10.
RSI analysis, union bank is technically weak.
According to simple moving average analysis, Union bank is in a strong downtrend.
Now what to expect???
Union Bank break and sustain below 130 will see downside panic till 124—122 mark in days to come.
Looks bullish only if close above 136.
Trading Recommendation (11th September 2017)
Sell Union Bank below 130 with stop loss of 136 (on a closing basis) Target 124---122.
Corporate Action
Jindal Steel & Power Limited-Annual General Meeting
Power Finance Corporation Limited-Annual General Meeting
Engineers India Limited-Annual General Meeting/Dividend - 0.50 per Share
Power Grid Corporation of India Limited-Dividend - Rs 3.35 per Share
More will update soon!!
