Nifty 9952 /Sensex 31809/ Bank Nifty 24328
31 Advances / 20 Declines/ 0 Unchanged
* Late buying helps Sensex to reclaim 31,800 mark; Nifty recaptures 9,950 level *
Indian equity benchmarks ended the volatile day of trade with a gain of around half a percent, with frontline gauges recapturing their crucial 31,800 (Sensex) and 9,950 (Nifty) levels, as traders went for bargain hunting after yesterday’s drubbing. Markets made an optimistic start with traders taking encouragement with Prime Minister Narendra Modi’s statement at BRICS Summit 2017 that India is fast changing into one of the most open economies in the world, with improvements on global indices and the biggest ever reform GST weaving the nation into one unified market. Investors also took note that the all-powerful GST Council may consider lowering tax on items of common consumption if the high trajectory of collections continues over the next few months. The tax reduction could be either on items of common consumption or a cut in headline rate which will benefit consumers.
However, markets pared all of their initial gains and entered into red terrain in noon deals with market participants turning cautious with the domestic rating agency Crisil lowering its growth forecast to 7 percent for fiscal 2018, down from 7.4 percent earlier, as it sees disruptions arising from the implementation of the new uniform tax regime to continue to impact the economy for a few more quarters. Sentiment was also hampered after activity in India’s dominant services sector contracted for a second straight month in August on disruptions caused by GST hurt new orders. August’s Nikkei/IHS Markit Services Purchasing Managers’ Index rose to 47.5, up from July’s 45.9 but still below the 50 mark that separates expansion from contraction.
Buying which emerged in last hour of trade proved to be the saving grace for domestic markets helping key gauges to end above their crucial psychological levels, with traders getting some support with Union minister Suresh Prabhu’s statement that the Commerce and Industry Ministry will soon bring in a policy framework for facilitating access to global markets for the Indian agriculture produce.
Firm opening in European counters too aided sentiments, as investors brushed off lingering geopolitical concerns and directed their attention to deal-making. Asian markets exhibited mixed trend on Tuesday. Japan’s services sector expanded in August at the slowest rate in six months as the pace of new orders eased, a private survey showed in a sign the economy is losing some momentum after this year’s solid gains.
Back home, stocks related to realty counters edged higher, as the new Minister for Housing and Urban Affairs, Hardeep Singh Puri, said that the government will meet the targets that have been instituted. Stocks of cement companies too ended in green after cement makers raised prices by up to Rs 27 per 50 kg bag in Mumbai. Gold and jewellery stocks too gained their shine, as India’s gold imports in August nearly tripled from a year ago, despite sluggish domestic demand.
FII’s Activity 5-Sept-17
The FIIs as per Tuesday’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 2236.20 crore against gross selling of Rs 3082.73 crore. Thus, FIIs stood as net sellers of Rs 846.53 crore in equities.
In the debt segment, the gross purchase was of Rs 793.33 crore with gross sales of Rs 956.87 crore. Thus, FIIs stood as net sellers of Rs 163.54 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
Trade with levels only.
Daily Derivative Outlook 6th September 2017
• Nifty (Sep) futures closed at a Premium of 19.40 points versus Premium of 14.80 points.
• Maximum call writing seen at 10200, Maximum put writing seen at 9900.
• Maximum positions are at 10000 CE and 9700 PE.
• RAMCOCEM (57%), VGUARD (27%), L&TFH (17%), HEXAWARE (16%) and BAJFINANCE (14%) were the top open interest gainers in the market.
• ICICIPRULI (-5%), JSWENERGY (-5%), INDIGO (-4%), TORNTPHARM (-4%) and NESTLEIND (-3%) were the top open interest losers in the market.
• The Nifty Put Call Ratio (PCR) finally stood at 1.35 for September month contract.
• Advance Decline ratio in F&O segment was at 1.16, Advance (173) + Decline (45) + Unchanged (0) = 219
Derivative Idea (06-09-2017)
CEAT gain around 10.9% of open interest as long build up on Tuesday’s trade. It has also breached its immediate Support level of 1740 on the upper side with noticeable rise in volume.
Now what to expect??
Hurdle at 1760. Break and sustain above 1760 take it to 1810—1830 and then to 1850 ++ mark in days to come.
Support and stop loss above 1710
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation(06-09-2017)
Buy CEAT (SEPT) future above 1760 Stop loss 1710(on closing basis) Target 1810-1830 and then to 1850++
Corporate Action
Balkrishna Industries Limited-Annual General Meeting/Dividend - Rs 2.50 Per Share
More Will Update Soon!!
