Update on Nifty levels, Bank Nifty levels, Derivative Outlook and Equity Pick of the day 22nd Nov 2017
Nifty 10326 /Sensex 33478/ Bank Nifty 25757
29 Advances / 20 Declines/ 1 Unchanged
Markets extend winning for fifth straight session
Indian equity benchmarks extended their gaining streak for fifth straight day and settled with a gain of around one third of a percent amid sanguine global cues. Markets traded in fine fettle throughout the session, though markets ended off day highs on late hour profit booking. Sentiments remained up-beat since beginning of the trade with traders taking support with international rating agency Moody’s report which expecting growth to revive next year, has said a 7.6% GDP expansion can result in corporates reporting a pre-tax profit growth of 5-6% over the next 12-18 months. The rating agency over the weekend had revised upwards sovereign ratings to Baa2 after almost 14 years. According to the rating agency, growth will “rebound strongly in 2018 because the supply chain disruptions of 2017 will end soon”. Some support also came with report that investors pumped over Rs 51,000 crore into various mutual fund schemes in October after pulling out more than Rs 16,000 crore in the preceding month.
Market participants also took some encouragement with chief economic adviser Arvind Subramanian hinting that the government may combine the 12% and 18% slabs under the goods and services tax (GST) into one in the near future and reserve the 28% rate only for demerit goods. Investors took note that the government has moved a notch closer to achieving its disinvestment target through minority stake sales in state-run companies as it has garnered around Rs 14,500 crore through its latest offering - the Bharat-22 Exchange Traded Fund (ETF). The Bharat-22 ETF, which comprises shares of 22 firms, was oversubscribed four times and saw bids of nearly Rs 32,000 crore coming in, with foreign institutional investors (FII) putting in nearly one-third of the amount bid.
Firm trade in European markets too aided sentiments with CAC, DAX and FTSE trading in green and the euro hit an eight-day low against sterling, with investors’ sentiments curbed by a political impasse in Germany. Britain’s budget gap unexpectedly widened last month, underscoring finance minister Philip Hammond’s challenge as he juggles calls for more spending in his budget on Wednesday with the prospect of weaker economic growth ahead. Asian markets ended mostly in green, supported by over half a percent gain in Nikkei, as the greenback remained supported by higher US bond yields.
Back home, traders booked some of their profit at higher levels in last leg of trade which pulled markets down from day’s high. On the sectoral front, select consumer durables stocks were buzzing in today’s trade on reports that the government may soon cut rates on consumer durables such as refrigerators and washing machines, which are currently in the 28% tax bracket. The move is likely to be a significant boost for the sector plagued by excess capacity and slowdown. The economy will get a fillip from the likely consumption boost and better compliance in this key sector. Shares of logistics companies remained on buyers’ radar after the government given infrastructure status to logistics sector, covering cold chain and warehousing facilities, a move that is likely to attract more funding at competitive rates for these segments. However, Realty stocks edged lower despite Fitch Ratings in its latest report forecasted a stable outlook for the Indian real estate. The rating agency also expects unsold inventory to fall from peak level in 2018.
FII’s Activity 21st-Nov-17
The FIIs as per Tuesday'’s data were net Sellers in equity segment, while they were net buyers in debt segment, according to data released by the NSDL.
In equity segment, the gross selling was of Rs 727 crore against gross selling of Rs 825 crore. Thus, FIIs stood as net buyer of Rs 5995 crore in equities.
In the debt segment, the gross purchase was of Rs 4073 crore with gross sales of Rs 3247 crore. Thus, FIIs stood as net sellers of Rs 6722 crore in debt.
Now what to expect ??
Nifty Levels
Above 10400 will see more upside rally till 10450 and then to 10500---10600 mark else it could test its support level of 10280 again.
Bank Nifty
Above 26200 will see more upside rally till 26400 and then to 26600---26800 mark else it could test its support level of 25600 again.
Trade within a range
Daily Derivative Outlook 22nd Nov 2017
• Nifty (Nov) futures closed at a Premium of 25.00 points versus a premium of 21.30 points.
• Maximum Call buying was seen at Nifty 10300 strike and Maximum Put writing was seen at Nifty 10300 strikes.
• Maximum positions are at 10500 CE and 10200 PE.
• KAJARIACER (63%), L&TFH (56%), SHREECEM (19%), NTPC (15%) and VGUARD (12%) were the top gainers in terms of open interest.
• JETAIRWAYS (-16%), JUSTDIAL (-11%), HEROMOTOCO (-7%), UBL (-7%) and RAMOCEM (-7%) were the top losers in terms of open interest.
• Advance Decline ratio in F&O segment was at 0.90, Advance (103) + Decline (114) + Unchanged (1) = 218
Apollo Tyres - Top Pick
Yesterday Apollo Tyres shown more than 5% upside move
On daily chart, Apollo Tyres has trend line breakout pattern which indicate downside movement limited in it and we can expect sharp upside move in it.
Now what to expect???
Apollo Tyres has a hurdle at 248 break and sustain above 248 will see rally till 253--256++ in days to come.
Further upside will see if closes above 256.
Support intact at 243
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (22nd Nov 2017)
Buy Apollo Tyres above 248 with stop loss below 243 (on a closing basis) Target 253—256 mark
More Will Update Soon!!
