Update on Nifty levels, Bank Nifty levels, and Derivative Outlook of the day 15th Nov 2017
Nifty 10186 /Sensex 32941/ Bank Nifty 25284
16 Advances / 32 Declines/ 2 Unchanged
Markets end lower on rise in inflation; Nifty slips below 10,200 mark
Indian equity benchmarks ended the lackluster day of trade in red terrain on Tuesday with frontline gauges breaching their crucial 33,000 (Sensex) and 10,200 (Sensex) levels, as traders remained concerned with retail inflation accelerating more than expected in October. Inflation quickened to 3.58 percent in the month, the fastest pace in seven months, from 3.28 percent increase in September. Consumer inflation rise was mainly due to an increase in prices of consumer food items. The inflation data showed that the Consumer Food Price Index (CFPI) - an indicator for food prices - also rose to 1.90% in October from 1.25% in September. Traders also remained cautious with rising crude prices and tax relief on some items under the Goods and Services Tax (GST) which is expected to threaten the government’s fiscal targets on back of possible dip in revenues. Giving hint of further rationalization of GST rates, Finance Minister Arun Jaitley has said that there is scope for further rationalization of GST rates and revenue buoyancy will decide the course of rationalization. The rising crude will also prevent the Reserve Bank of India from cutting interest rates any further.
Markets tried to recoup their losses in second half of trade but selling in dying hour of trade dragged markets near intraday lows, as sentiments turned down-beat after India’s inflation on wholesale level picked up in the month of October due to increase in prices of food and fuel products. According to the latest data released by the government, the wholesale price inflation (WPI) climbed to 3.59% in October 2017 from 2.60% in September 2017 and 1.27% during the corresponding month of the previous year. Build up inflation rate in the financial year so far was 2.03% compared to a buildup rate of 3.53% in the corresponding period of the previous year. Investors failed to get any sense of relief with a private report that business confidence in the country during the ongoing quarter has improved on account of government measures, macroeconomic boost and festive season demand, among others. The index stood at 76.7 during October-December of 2017, an increase of 6.4% from the preceding three months. The index, however, fell 4.1% against the corresponding three months a year ago.
On the global front, European markets were trading mostly in green in early deals, as telecoms and tech companies supported shares, helping them steady above a seven-week low hit in the previous session. Asian markets ended mostly in red, as Chinese economic data disappointed and uncertainty lingered over US tax policy.
Back home, infrastructure related stocks edged lower despite ICRA in its report stating that even though many infrastructure players are still struggling with stressed balance sheets there has been an improvement in financial profile of firms, having exposure to airport and highways projects indicating a revival in the sector. The agency added that early signs of a revival of the infrastructure sector are evident with the improvement in the financial profile of players. Manufacturing sector stocks too ended in red despite Prime Minister Narendra Modi’s statement that the Indian government wants to make the country a Global Manufacturing Hub. He said, “We want to make India a global manufacturing hub and we want to make our youngsters job creators.” Meanwhile, Footwear retailer Khadim India made a dismal listing on the bourses today and ended the session with a cut of over 8%, the IPO was subscribed 1.90 times.
FII’s Activity 14th-Nov-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 4632.82 crore against gross selling of Rs 4768.55 crore. Thus, FIIs stood as net sellers of Rs 135.73 crore in equities.
In the debt segment, the gross purchase was of Rs 2263.31 crore with gross sales of Rs 2648.67 crore. Thus, FIIs stood as net sellers of Rs 385.36 crore in debt.
Now what to expect ??
Nifty Levels
Below 10230 will see more downside panic till 10180 and then to 10150---10050 mark else it could test its resistance level of 10400 again.
Trade within a range
Bank Nifty
Below 25300 will see more downside panic till 25150---25000 mark else it could test its resistance level of 25400---25550 again.
Trade within a range
Daily Derivative Outlook 15th Nov 2017
• Nifty November 2017 futures closed at 10269.40 on Monday, at a premium of 44.45 points over spot closing of 10,224.95.
• Call writing was seen at Nifty 10400 strike and Maximum Put buying was seen at Nifty 10300 strikes.
• Maximum positions are at 10500 CE and 10200 PE.
• INFRATEL (36%), REPCOHOME (27%), VOLTAS (26%), CADILAHC (21%) and BATAINDIA (19%) were the top gainers in terms of open interest.
• OFSS (-17%), AMARAJABAT (-14%), GODFRYPHLP (-11%), JUSTDIAL (-10%) and BRITANNIA (-8%) were the top losers in terms of open interest.
• Advance Decline ratio in F&O segment was at 1.13, Advance (88) + Decline (129) + Unchanged (1) = 218
Derivative Idea (15-11-2017)
Ashok Leyland losses 1.38% of open interest as short Unwinding on Tuesday’s trade. On Daily chart it is forming hammer candlestick pattern.
Now what to expect??
Hurdle at 115.50. Break and sustain above 115.50 will take it to 120--122 and then to 125++ mark in days to come.
108 will act as major support.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (15th Nov 2017)
Buy Ashok Leyland above 115.50 with stop loss of 108 for the initial target 120—122 and then to 125 mark.
More Will Update Soon!!
