Update on Nifty levels and Equity Pick of the day 3rd Oct 2017
Nifty 9788 /Sensex 31283/ Bank Nifty 24053
31 Advances / 18 Declines/ 1 Unchanged
Late hour selloff drag benchmarks near neutral lines
Erasing most of their early gains, Indian equity benchmarks ended flat on Friday, as traders opted to book profit at higher levels in last leg of trade ahead of long weekend. Traders also remained on sidelines ahead of some economic data slated to be released in next week. Though, markets started off on optimistic note as sentiments remained up-beat with statement of Niti Aayog member Bibek Debroy, who is also Chairman of the Prime Minister’s Economic Advisory Council that while there may be some minor problems with the economy, it was nothing to be worried about. Domestic bourses extended their gains to reclaim their crucial 31,500 (Sensex) and 9,850 (Nifty) levels, as traders took some encouragement with report that the government will stick to its borrowing and fiscal deficit targets for this fiscal, indicating that it has no plans to relax spending goals to prop up growth as of now. The finance ministry on Thursday released borrowing calendar for the second half of FY18, indicating a gross borrowing of Rs 2.08 lakh crore, which is in line with the target laid out in the Budget. Reports that the Goods and Services Tax (GST) collections in the first two months have met the target and going forward the revenue will see further surge, too aided sentiments.
However, benchmarks took U-turn from high point of the day as market participants booked almost all of their early gains to end flat. Sentiments turned pessimistic on report that Securities and Exchange Board of India (SEBI) continued to hit participatory notes (P-notes) investments in month of August too. The share of foreign portfolio investments (FPI) in domestic capital markets through P-notes dropped to seven and a half year low of Rs 1.25 lakh crore at August- end from Rs 1.35 lakh crore at the end of July. Some cautiousness also crept with credit rating agency Icra’s report that Reserve Bank of India is likely to leave policy rates unchanged in the forthcoming policy review next month as it expects a spike in retail inflation going ahead. Meanwhile, the Centre plans to borrow Rs 2.08 lakh crore from the market in the second half of 2017-18, reiterating the government’s commitment to meet the fiscal deficit target of 3.2 per cent of the gross domestic product (GDP).
On the global front, European counters trading mostly in green as investors focus on data releases and monitor US plans to overhaul the tax system. Consumer price inflation (CPI) in the euro zone remained stable in September, missing forecasts for a slight increase, while the core reading eased unexpectedly. Asian markets ended mostly higher on Friday, though gains remained capped amid expectations of a rate hike by the US Federal Reserve in December.
Back home, auto stocks remained in top gear ahead of their September month sales data slated to be released on start of next week. Select cement stocks remained under pressure on ICRA report that cement demand growth is expected to be around 3.5%-4% during the current financial year, a downward revision against the earlier estimate of 5% as there has been a delay in the revival of cement demand during the first half of FY2018. The export oriented stocks remained buzzing as the Industry bodies and exporters raised their concerns related to the Goods and Services Tax (GST), including timely refund of duties, with Finance Minister Arun Jaitley at a meeting.
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 9740 will see more downside panic till 9683 and then to 9604---9555 else it could test its resistance level of 9905 again.
Close above 9905 will see more upside rally till 9960 and then to 10065---10120 mark again
Major hurdle at 10200 which is unlikely to breach for time being
Bajaj Auto - Top Pick (3rd Oct 2017)
Bajaj Auto reported 14 per cent increase in total sales at 4,28,752 units in September.
Motorcycle sales were at 3,69,678 units as against 3,31,976 in the year-ago month, up 11 per cent, it added. Domestic motorcycle sales rose 7 per cent to 2,47,418 units compared to 2,30,502 in September last year, the company said.
Commercial vehicles sales were up 32 per cent at 59,074 units as against 44,789 in the corresponding month last year.
Overall exports in September were at 1,46,973 units as against 1,21,173 in the same month last year, up 21 per cent, Bajaj Auto said.
Bajaj Auto closed at Rs. 3126 which was 75.25 points more than today's lowest price and 28.2 points less than the day's highest with the day's lowest being Rs. 3051.15 and highest being Rs. 3154.6
By this time of the day, a total of 368,325 shares were traded with the 5 day average volume being 299,281 , 10 day average volume being 354,657 and 30 day average volume being 267,593.
Compared to the previous day the 5 day average volume fell 3169 stocks, 10 day average volume rose 19545 stocks and 30 day average volume rose 6497 stocks.
Now what to expect???
Bajaj Auto break and sustain above 3155 will see upside rally till 3260—3272 mark in days to come.
Looks bearish only if close below 3050 marks.
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (3rd October 2017)
Buy Bajaj Auto above 3155 with stop loss below 3050 (on a closing basis) Target 3260 - 3272.
More Will Update Soon!!
