Update on Nifty levels & Derivative Outlook of the day 29th Sept 2017
Nifty 9768 /Sensex 31282/ Bank Nifty 24008
26 Advances / 25 Declines/ 0 Unchanged
Benchmarks snap seven days losing streak
Snapping seven days losing streak, Indian equity benchmarks ended the session with gain of over one third of a percent. However, domestic gauges truly depicted the choppiness of F&O expiry session, with frontline gauges swinging between green and red for most part of the day, as traders remained concerned with India Ratings’ report that India’s GDP growth estimate for the ongoing financial year 2017-18 is likely to come down to 6.7 per cent from 7.4 per cent earlier as “the combined effect of demonetization and introduction of goods and services tax (GST) is proving to be more disruptive for the economy than was expected earlier”. Separately, a poll enlightened that the Reserve Bank of India will hold policy steady at its October 4 meeting, and well past next year, amid weak economic growth and signs inflation may soon overshoot its target.
Buying in last leg of trade comes as the saving grace for the markets and helped them to end in green terrain, as the traders settled their positions and covered shorts going to new series. Traders took some solace with Prime Minister Narendra Modi’s statement that traders across the country are 'positive' about GST and accepting the new taxation arrangement but they need 'handholding' so that their problems can be resolved. He urged the chief secretaries to use the district administration in this regard, so that small traders are facilitated to access and adopt the new system. Adding to the optimism, Niti Aayog vice chairman Rajiv Kumar said that the economic downturn which began in the last two years of UPA II regime has bottomed out and the growth will improve in the next two quarters. Investors also took support with private report highlighting that India is expected to be a $6 trillion economy -- the third largest in the world -- in the next 10 years, majorly helped by digitization. According to global brokerage firm, India's digitisation drive would provide a boost of 50-75 basis points to GDP growth in the coming decade.
Firm opening in European counters too provided some strength to Indian markets, with CAC, DAX and FTSE trading in green amid hopes for US tax reform plans and an upcoming rate hike, while political turmoil in Germany still weighed. Euro zone economic sentiments improved more than expected in September, reaching levels last seen in July 2007, with optimism rising in all sectors except financial services. Asian markets ended mostly in red after South Korea said it expects North Korea to engage in more provocative action next month.
Back home, stocks related to real estate space firmed up as the developers are betting big on the upcoming festive season to push housing sales, and are going all out to regain some lost ground, especially at a time when interest rates on home loans are at more than six-year low and demand for affordable housing is picking up. PSU banking stocks too remained on buyers’ radar on report that the government is planning to give growth capital to performing state-run banks as it looks to encourage credit disbursement for private investment. An assessment is being carried out and adequate capital will be provided to performing state-run banks to push credit growth.
FII’s Activity 29-Sept-17
The FIIs as per Thursday’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 5719.92 crore against gross selling of Rs 6238.16 crore. Thus, FIIs stood as net sellers of Rs 518.24 crore in equities.
In the debt segment, the gross purchase was of Rs 1519.51 crore with gross sales of Rs 1563.66 crore. Thus, FIIs stood as net sellers of Rs 44.15 crore in debt.
Now what to expect ???
Nifty Levels
Break and sustain below 9688 will see more downside panic till 9604---9555 (May take dead cat bounce in between range of 9604---9555) else it could test its resistance level of 9905 again.
Close above 9905 will see more upside rally till 9950---9985 and then to 10065 mark.
Major hurdle at 10200 which is unlikely to breach for time being
Daily Derivative Outlook 29th September 2017
• Nifty (Oct) futures premium decreased significantly
from 32.50 points to 18.05 points with 2.05 crore shares in open interest.
•Market wide rollover was at 84.98% v/s 83.94%, whereas rollover in Nifty futures was at 69.87% v/s 57.96% in the last expiry.
• Maximum call writing seen at 9800, Maximum put writing seen at 9500.
• Maximum positions are at 9900 CE and 9700 PE.
• IBREALEST (95%), JSWSTEEL (95%), ADANIPOWER (93%), TV18BRDCST (93%) and DALMIABHA (93%) witnessed good rollover in the next series.
• NIITTECH (61%), OIL (66%), RAMCOCEM (68%), INDIGO (68%) and IRB (69%) witnessed low rollover in the next series.
• The Nifty Put Call Ratio (PCR) finally stood at 1.24 for October month contract.
Derivative Idea (29-09-2017)
Jet Airways gain around 77.00% of open interest as long build up on Thursday’s trade. It is trading near its major support level of 465, while Jet Airways formed a squat bar on daily chart.
Now what to expect??
Hurdle at 482, above 482 rally remain continue till 500—510 and then to 530 mark in days to come.
Support and stop loss below 465.00
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (29th Sept 2017)
Buy Jet Airways above 482 Stop loss 465.00 (on closing basis) Target 500—510 and then to 530.
More Will Update Soon!!
