Update on Nifty levels, Bank Nifty levels, Derivative Outlook and Equity Pick of the day 21st Nov 2017
Nifty 10298 /Sensex 33359/ Bank Nifty 25768
27 Advances / 22 Declines/ 1 Unchanged
Markets eke out slender gains from a choppy session
Indian equity benchmarks managed to keep their head above water on Monday and went home with slender gains. Markets traded choppy throughout the session, as street digested Moody’s India upgrade and focused on Gujarat Assembly elections that will take place next month. The street took note of US-based rating agency Moody’s report that lower taxes and higher public expenditure could widen budget deficit in 2017-18, but steps taken by the government to broaden the tax base and improve spending efficiency would help in narrowing it going forward. Though, market participants took some comfort with the IMF data, which forms part of the latest World Economic Outlook report of the International Monetary Fund, stating that India has moved up one position to 126th in terms of per capita GDP of countries, though it still ranked lower than all its BRICS peers. Some support also came with SBI research report stating that India might not have to wait for 13 long years for next sovereign upgrade by a rating agency, as the government is firm and committed to adhere with the fiscal consolidation path.
Traders also took some solace with Finance Secretary Hasmukh Adhia’s statement that the latest changes have resolved nearly 90% of problems and discontentment related to the indirect tax regime. Separately, Department of Economic Affairs Secretary Subhash Chandra Garg has said that he hopes the growth rate to touch 7% by the end of fiscal year. Garg called the current financial year a transitional one, bearing the impact of major reforms like such as the demonetization and the implementation the new indirect tax system-Goods and Services Tax (GST).
Weak opening in European markets kept the gains in domestic markets in check with CAC, DAX and FTSE trading in red in early deals after preliminary coalition talks in Germany collapsed. The Free Democrats have apparently signaled that they could support a minority government made up of the CDU-CSU bloc and the Green party. Asian markets closed mixed, with investors’ sentiments hurt by a retreat on Wall Street. China’s new home prices rose at a slightly faster pace in October after gains had held steady the previous month, as prices remained resilient in the face of falling sales and a tighter liquidity environment.
Back home, the aviation stocks remained on buyers’ radar with report that India’s domestic air traffic registered a growth of 20.52% in October when airlines flew 10.45 million passengers as compared to 8.67 million during the corresponding period last year. Stocks related to the logistics sector edged higher on report that government may grant infrastructure status to logistics sector soon, a move that will help the industry raise funds at competitive rates and boost India's trade. However, the cement stocks witnessed some pressure on reports that the government is considering banning import of pet coke - a cheap fuel used by cement, paper, brick kiln, chemicals and textile industries-to cut industrial pollution that’s contributing to hazy skies. The possible ban will be discussed on Tuesday, when oil minister Dharmendra Pradhan deliberates the issue with secretaries of several departments.
FII’s Activity 17th-Nov-17
The FIIs as per Monday’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 6832.46 crore against gross selling of Rs 5396.08 crore. Thus, FIIs stood as net buyers of Rs 1436.38 crore in equities.
In the debt segment, the gross purchase was of Rs 2345.92 crore with gross sales of Rs 2428.82 crore. Thus, FIIs stood as net sellers of Rs 82.90 crore in debt.
Now what to expect ??
Nifty Levels
Above 10350 will see more upside rally till 10400 and then to 10450---10500 mark else it could test its support level of 10250 again.
Bank Nifty
Above 25900 will see more upside rally till 26300 and then to 26700---26800 mark else it could test its support level of 25570-25350 again.
Trade within a range
Daily Derivative Outlook 21st Nov 2017
• Nifty (Nov) futures closed at a Premium of 25.25 points versus a premium of 21.30 points.
• Maximum Call writing was seen at Nifty 10400 strike and Maximum Put writing was seen at Nifty 10300 strikes.
• Maximum positions are at 10500 CE and 10200 PE.
• SHREECEM (26%), TATAPOWER (16%), VOLTAS (14%), BALKRISIND (12%) and AJANTPHARM (11%) were the top gainers in terms of open interest.
• PAGEIND (-11%), DLF (-10%), HDIL (-8%), ICIL (-8%) and CEATLTD (-7%) were the top losers in terms of open interest.
• Advance Decline ratio in F&O segment was at 1.13, Advance (138) + Decline (77) + Unchanged (3) = 218
Derivative Idea (21-11-2017)
Ajanta Pharma gain 11.00 % of open interest as long build up on Monday’s trade. On Daily chart Ajanta Pharma 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 1280, Break and sustain above 1280 will take it to 1350—1380 and then to 1450++ mark in days to come.
1230 will act as major support.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (21st Nov 2017)
Buy Ajanta Pharma above 1280 with stop loss of 1230 for the initial target 1350—1380 and then to 1450++mark.
MHRIL - Top Pick
Yesterday MHRIL shown more than % upside move
On daily chart, MHRIL has bottom out pattern which indicate downside movement limited in it and we can expect sharp upside move in it.
Now what to expect???
MHRIL has a hurdle at 345 break and sustain above 345 will see rally till 355--362++ in days to come. Further upside will see if closes above 362.
Support intact at 336
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (21st Nov 2017)
Buy MHRIL above 345 with stop loss below 336 (on a closing basis) Target 355—362+++.
Corporate Action
Aurobindo Pharma Limited-Interim Dividend Rs 1.50 per Share
MRF Limited-Interim Dividend - Rs 3/- Per Share
More Will Update Soon!!
