Update on Nifty levels and Derivative Outlook of the day 20th Nov 2017
Nifty 10283 /Sensex 32106/ Bank Nifty 25446
28 Advances / 21 Declines/ 1 Unchanged
Bulls tighten grip on Dalal Street as Moody’s lifts India’s rating
Extending their previous session’s rally, Indian equity benchmarks ended the Friday’s trade with a gain of over half a percent, with Sensex and Nifty recapturing their crucial 33,300 and 10,250 levels respectively. Sentiments remained buoyant throughout the session, despite some profit booking in last leg of trade, as Moody’s Investor Service raised India’s government bond rating, citing continued progress in the nation’s economic and institutional reforms. The rating agency upgraded India’s bond rating to ‘stable’ (Baa2) from ‘positive’ (Baa3) and said reforms being pushed through by the government will help stabilize debt. The agency has also upgraded India’s local currency senior unsecured rating to Baa2 from Baa3 and its short-term local currency rating to P-2 from P-3. Traders also took some encouragement with RBI Governor C Rangarajan’s statement who said the inflation, which rose to 3.58% in October, may ease by December and end up below 4% by the end of the current fiscal.
Adding to the optimism, Commerce and Industry Minister Suresh Prabhu exuded confidence that exports will gather momentum going forward as the economy is on course to double to $5 trillion and become the third largest in the world, over the next few years. Meanwhile, highlighting ‘massive’ economic reforms undertaken by India, Finance Minister Arun Jaitley has said that the country’s economic slowdown has bottomed out and now it should start moving upwards after recovering from the temporary blip. He acknowledged that there was a ‘temporary blip’ as a result of structural changes initiated by the government. However, markets pare some of their gains to end off day’s highs, as there were some cautiousness too in India Inc. as the Reserve Bank of India is likely to come up with a fresh list of around 50 loan accounts that are either under stress or close to being classified as non-performing assets. The regulator may set a March 31 deadline for banks to find a resolution on these or commence bankruptcy proceedings against the borrowers.
On the global front, the European markets were trading in red with investors eyeing an upcoming speech by European Central Bank President Mario Draghi due later in the day. Asian markets ended mostly in green, building up on their last session’s rally, as risk appetite returned amid rising odds of US corporate tax cuts and encouraging earnings.
Back home, the markets took support with Niti Aayog Vice Chairman Rajiv Kumar’s statement that India’s credit rating upgrade by Moody’s is a reflection of the country’s growth story. He also expressed hope that other global agencies such as S&P and Fitch would follow suit. On the sectoral front, realty stocks remained in focus, as the government has decided to increase the carpet area of houses eligible for interest subsidy under the Credit Linked Subsidy Scheme (CLSS) for the Middle Income Group (MIG) under Pradhan Mantri Awas Yojana (PMAY). The move also means that the private developers will have incentives to increase scale. Meanwhile, HDFC Standard Life Insurance Company has made a decent debut and ended the session with a gain of around 19% on the BSE.
FII’s Activity 17th-Nov-17
The FIIs as per Friday’s data were net buyers in equity segment, while they were net sellers in debt segment, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 5258.28 crore against gross selling of Rs 4968.80 crore. Thus, FIIs stood as net buyers of Rs 289.48 crore in equities.
In the debt segment, the gross purchase was of Rs 957.18 crore with gross sales of Rs 958.72 crore. Thus, FIIs stood as net sellers of Rs 1.54 crore in debt.
Now what to expect ??
Nifty Levels
Above 10380 will see more upside rally till 10420 and then to 10450---10500 mark else it could test its support level of 10200 again.
Trade within a range
Daily Derivative Outlook 20th Nov 2017
• Nifty (Nov) futures closed at a premium of 25.25 points versus a premium of 36.15 points.
• Maximum Call buying was seen at Nifty 10300 strike and Maximum Put writing was seen at Nifty 10200 strikes.
• Maximum positions are at 10500 CE and 10200 PE.
• JUSTDIAL (22%), HDIL (22%), MGL (18%), BALKRISIND (16%) and TATAPOWER (15%) were the top gainers in terms of OI.
• BANKBARODA (-11%), CHOLAFIN (-11%), PAGEIND (-9%), NCC (-8%) and RCOM (-7%) were the top losers in terms of OI.
• Advance Decline ratio in F&O segment was at 1.13, Advance (138) + Decline (77) + Unchanged (3) = 218
Derivative Idea (17-11-2017)
Just dial gain 22.00 % of open interest as long build up on Friday’s trade. On Daily chart just dial is trading above 21 and 55 DEMA which indicate upside momentum is certain in it while It is trading near immediate resistance level on the upper side with noticeable rise in volumes.
Now what to expect??
Hurdle at 560, Break and sustain above 560 will take it to 600--620 and then to 650++ mark in days to come.
535 will act as major support.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (20th Nov 2017)
Buy Just Dial above 560 with stop loss of 535 for the initial target 600—620 and then to 650++ mark.
Corporate Action
Granules India Limited--Interim Dividend Re 0.25 Per Share
Amara Raja Batteries Limited--Interim Dividend Rs 2/- Per Share
Today's top pick will update during market hours.
More Will Update Soon!!
