Nifty 9974 /Sensex 31892/ Bank Nifty 24434
40 Advances / 11 Declines/ 0 Unchanged
Markets start new F&O series on optimistic note*
Extending their northward journey for third straight day, Indian equity benchmarks ended the new F&O series on optimistic note. Soon after a cautious start, markets gained traction and showed ample of strength in early deals, as traders chose to ignore weak Gross Domestic Product (GDP) numbers which came at a dismal 5.70 percent against 7.90 percent in the same quarter last year and a 13 quarter lowest level. According to data released by the government, quarterly GVA at basic prices for Q1FY18 from manufacturing sector grew by 1.2 percent as compared to the growth of 10.7 percent in Q1FY17. Traders focused on Finance Minster Arun Jaitley’s statement the lower GDP numbers to pre-GST destocking of goods and expressed hope that the economy will grow at 7 percent, saying manufacturing has bottomed out. Also, Chief Statistician of India T C A Anant said that the slowdown in GDP growth for the first quarter of 2017-18 to 5.7 percent was due to de-stocking by firms as caution ahead of the GST roll-out on July 1.
Markets continued its strong run till end with Sensex ending near its crucial 31,900 mark, while Nifty ending above their crucial 9,950 mark, as traders shrugged off eight core sectors which slowed down to 2.4 percent in July. The contraction was mainly seen in output of crude oil, refinery products, fertiliser and cement. Rebound in India’s manufacturing PMI in the month of August to 51.2 as compared to 47.9 in July, aided by rise in new orders and output across the country, also contributed to the up-move.
Firm opening in European counters too aided sentiments, with CAC, DAX and FTSE all trading in green in early deals, as investors geared up for more data releases, while taking note of the positive trading seen overseas. Asian markets ended mostly in green with regional manufacturing figures aiding sentiments. South Korea’s annual inflation surged in August to its highest in more than five years as heavy rain and a summer heat-wave pushed up the price of fresh foods.
Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Some support also came after Finance Minister Arun Jaitley put private sector debtors on notice, saying they will have to pay their dues to banks or others will step in and take control of the businesses. The minister also defended demonetization, declaring that its impact was along expected lines and the economy will benefit from it in the medium and long term.
FII’s Activity 1-Sept-17
The FIIs as per Friday’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 8453.97 crore against gross selling of Rs 8010.06 crore. Thus, FIIs stood as net buyers of Rs 443.91 crore in equities.
In the debt segment, the gross purchase was of Rs 444.21 crore with gross sales of Rs 221.02 crore. Thus, FIIs stood as net buyers of Rs 223.19 crore in debt.
Nifty Levels
Above 10020 will see upside rally till 10050 - 10080 and then to 10170 marks else it could test its support level of 9920 again.
Close below 9920 will see more downside panic till 9850---9820 and then to 9700 mark.
Trade with levels only.
Daily Derivative Outlook 4th September 2017
• Nifty September 2017 futures closed at 10007.30 on Friday at a premium of 32.90 points over spot closing of 9974.40.
• Maximum call writing seen at 10000, Maximum put writing seen at 9900.
• Maximum positions are at 10000 CE and 9700 PE.
• Long build up: IBREALEST (22.10%), HCC (12.20%) RELCAPITAL (12.00%), SUNTV (4.6%) IDFC (1.7%)
• Short build up: GRASIM (41.3%), IDEA (3.00%), TCS (2.3%), SREINFRA (2.00%) and ADANIPOWER (0.6).
• The Nifty Put Call Ratio (PCR) finally stood at 1.16 for September month contract.
• Advance Decline ratio in F&O segment was at 1.16, Advance (221) + Decline (7) + Unchanged (1) = 219
Derivative Idea (04-09-2017)
SUNTV gain around 4.6% of open interest as long build up on Friday’s trade. It has also breached its immediate resistance level of 770.50 on the upper side with noticeable rise in volume.
Now what to expect??
Hurdle at 785. Break and sustain above 785 take it to 810—830 and then to 850 mark in days to come.
Support and stop loss below 730.00
Current chart pattern and derivatives data suggest that we expect further panic in coming sessions.
Trading Recommendation (04-09-2017)
Buy SUNTV (SEPT) future above 785.00 Stop loss 730.00(on closing basis) Target 810.00—830.00 and then to 850.00++
Bodal Chemicals- Top Pick (04-09-2017)
Bodal has set its goal on building an empire in large USD 730 billion global specialty chemical market. Clear management vision, expertise in chemical manufacturing, free cash generation from existing business and backward integration will support the growth momentum.
Price just got above its 20-day exponential moving average which is a positive signal. According to exponential moving average analysis, Bodal Chemicals is in an uptrend.
Now what to expect???
Break and sustain above 174 will see upside rally till 180--184++ mark in days to come.
Looks bearish only if close below 168 marks.
Buy Bodal Chemicals above 174 with stop loss of 168 (on a closing basis) for the upside target of 180---184+++
More Will Update Soon!!
