Nifty 10141 /Sensex 32402/ Bank Nifty 25041
20 Advances / 31 Declines/ 0 Unchanged
Benchmarks end flat as geo-political concerns resurface
Indian equity benchmarks ended the choppy day of trade on flat note with negative bias on Wednesday, as investors girded for another round of geopolitical tensions after US President Donald Trump threatened to annihilate North Korea. Frontline gauges swung between green and red throughout the day, as traders remained cautious due to outcome of two-day Fed policy review on wednesday. Sentiments also remained dampened with SBI Research stating that economy has been on a downslide since September 2016 and the slowdown is real and not technical, calling for more public spending to arrest the slide. The report advocated upping of spends by the government as a solution to the problem at hand. Meanwhile, exporters fearing that a staggering Rs 65,000 crore could get stuck in GST refunds have asked the government to fast-track the refund process and avoid further deterioration in their liquidity situation. The 22nd meeting of the GST Council, chaired by Union Finance Minister Arun Jaitley, will be held on October 6 to deliberate on GSTN glitches and ironing out issues faced by exporters.
However, traders took some solace with report that the government may soon unveil a package of measures to speed up growth, generate employment, lift exports and step up investment in infrastructure. A broad framework to boost the economy was discussed in a meeting of ministers and officials chaired by finance minister Arun Jaitley late Tuesday evening as the government grappled with a slump in growth. Traders also get some sense of relief with World Bank India chief Junaid Ahmad’s statement that effective implementation of the new tax regime will help the economy achieve 8% plus growth and described GST a ‘tectonic shift’. Junaid Ahmad, further highlighting the positive impact of GST, said that the economic corridors of India will change on the back of the new tax regime.
On the global front, European markets made weak opening and trading flat in early deals, with rate-sensitive banking shares edging lower. British retail sales unexpectedly surged in August, boosting the chance the Bank of England will raise interest rates at its next meeting. Asian markets closed mixed, due to policy decision by the US Federal Reserve. Booming shipments of cars and electronics in August drove up Japan’s exports at the fastest pace in nearly four years, further evidence that overseas demand is strong enough to support healthy economic growth.
Back home, steel stocks showed shine after ICRA in its report highlighted that domestic steel firms will see improved profitability in near term. A 14% increase in domestic steel prices since June 2017, led by a sharp recovery in international steel prices and growth in domestic demand in the April-August period has brought much-needed cheer in the steel sector. Select tyre stocks remained on buyers’ radar, as government imposed anti-dumping duty on import of certain type of radial tyres used in buses and trucks to protect domestic manufacturers from below cost shipments from China for five years. Telecom stocks showed mixed trend as the Telecom Regulatory Authority of India (TRAI) has more than halved the interconnect usage charge (IUC) from October 1 and said the fee will be scrapped from 2020, in a move that it said would benefit consumers. IUC has been reduced to 6 paise a minute from 14 paise a minute and to zero starting January 1, 2020, based on the view that costs incurred by operators will drop.
FII’s Activity 20-Sept-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 3077.03 crore against gross selling of Rs 4654.94 crore. Thus, FIIs stood as net sellers of Rs 1577.91 crore in equities.
In the debt segment, the gross purchase was of Rs 1016.99 crore with gross sales of Rs 152.84 crore. Thus, FIIs stood as net buyers of Rs 864.15 crore in debt.
Now what to expect??
Nifty Levels
Above 10200 will see more upside rally till 10400---10500 marks else it could test its support level of 10100 again.
Below 10100 will see more downside panic till 10050---9980
Trade with levels only
Daily Derivative Outlook 21st September 2017
• Nifty September 2017 futures closed at 10167.55 on
Wednesday at a premium of 26.40 points over spot closing of
10141.15,
• Maximum call writing seen at 10100, Maximum put writing seen at 10100.
• Maximum positions are at 10200 CE and 10000 PE.
• Long build up: SOUTHBANK (19.50%), KTKBANK (10.30%), DRREDDY (3.4%), NIITECH (3.3%) and DIVISLAB (1.9%).
• Short build up: INDIACEM (11.80%), GODREJIND (7.00%), ICICIPRULI (7.60%), GSFC (2.60%) and BPCL(1.70%).
• The Nifty Put Call Ratio (PCR) finally stood at 1.50 for September month contract.
Derivative Idea (21-09-2017)
Karnataka Bank gain around 10.30% of open interest as long build up on Wednesday ’s trade. It has also breach its immediate resistance level of 161 on the upper side with noticeable rise in volume.
Now what to expect??
Hurdle at 165.00, Break and sustain above 165.00 will take it to 170--172 and then to 175++ mark in days to come.
Support and stop loss below 160.00
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation
Buy KTKBANK (SEPT) future above 165 Stop loss 160 on closing basis) Target 170--172 and then to 175++ mark.
Corporate Action
Reliance Capital Limited-Annual General Meeting/Dividend - Rs 10.50 Per Share
Oil & Natural Gas Corporation Limited-Annual General Meeting/Dividend - Re 0.80 Per Share
Yes Bank Limited-Face Value Split (Sub-Division) - From Rs 10/- Per Share To Rs 2/- Per Share
Housing Development and Infrastructure Limited-Annual General Meeting
Dish TV India Limited-Annual General Meeting
Kaveri Seed Company Limited-Annual General Meeting
Indiabulls Real Estate Limited-Annual General Meeting
More Will Update Soon!!
