Update on Nifty levels, Bank Nifty levels, Derivative Outlook and Equity Pick of the day 23rd Nov 2017
Nifty 10342 /Sensex 33478/ Bank Nifty 25766
23 Advances / 27 Declines/ 0 Unchanged
Markets extend northward journey for fifth straight day
Extending their northward journey for fifth straight session, Indian equity benchmarks ended the Wednesday’s trade with a gain of around quarter a percent. Despite some hiccups in first half of the session, markets traded with traction for most part of the day with traders taking some support with report that GST tax returns filed increased. Filings of the summary returns GSTR-3B - with which the tax needs to be paid or nil liability claimed - have increased over the months since July. Till the August 20 deadline for filing GSTR-3B for the month of July without fine, 34 lakh returns were filed; the returns filed before the respective deadline for September was higher at 39.4 lakh and the number for October grew further to 43.7 lakh. Some support also came with report that earnings of companies in the September quarter surprised investors and analysts, who almost doubled their upgrade ratings on the stocks they cover after the results.
The sentiments also remained positive with ICRA’s report highlighting that the economic expansion in terms of gross value added (GVA) is expected to improve to 6.3% in the three months to September from 5.6% in the previous quarter, on the back of a rise in industrial growth. Headline GVA growth, however, is likely to trail the 6.8% recorded in the second quarter of FY17. Investors also took some comfort with the report that the government has set up a 14-member panel to identify and suggest ways to address issues faced in implementation of the law. Meanwhile, the Cabinet approved a policy framework for central public sector enterprises (CPSEs) to negotiate the next round of wage revision with their workers. However, gains remained capped, as investors took note of a report that S&P said India’s activity indicator looks lackluster indicating they might not barge on the BBB- rating on India any time soon.
Weakness in European counters too capped the up-side in domestic markets on concerns over political tensions in Germany and ahead of the presentation of the latest UK budget due later in the day. Asian markets closed in green, as globally investors await the minutes of recent Federal Reserve policy meeting due later today. The Bank of Japan is dropping subtle, yet intentional, hints that it could edge away from crisis-mode stimulus earlier than expected, through a future hike in its yield target.
Back home, stocks related to auto sector remained in focus, as highlighting auto industry’s quick revival from the negative impact of note ban, global ratings agency, Fitch Ratings in its latest report said that Indian passenger vehicles (PV) and two-wheelers sales are likely to continue growing in high single digits in the near term, backed by sustained low cost of ownership and healthy rural spending due to good monsoons and higher public-sector wages. Shares of public sector remained buzzing in today’s trade as investors reacted to Cabinet’s actions. The Cabinet had cleared an ordinance for changes to Insolvency and Bankruptcy Code (IBC). However, telecom stocks remained under pressure despite the Telecom Regulatory Authority of India (TRAI) recommending the removal of the intra-band cap of 50% spectrum holding by operators in a circle. Mixed reactions were displayed in leather stocks with most of them losing their early gains on report that the Cabinet Committee has deferred incentive package for the industry. The Union Cabinet was expected to soon take a decision on Rs 2,600 crore incentive package for the labor-intensive leather and footwear sector to boost exports and job creation.
FII’s Activity 22nd-Nov-17
The FIIs as per Wednesday’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 buying was of Rs 6071.71 crore against gross selling of Rs 6317.74 crore. Thus, FIIs stood as net sellers of Rs 246.03 crore in equities.
In the debt segment, the gross purchase was of Rs 1819.11 crore with gross sales of Rs 458.29 crore. Thus, FIIs stood as net buyers of Rs 1360.82 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 25900 will see more upside rally till 26200 and then to 26400---26600 mark else it could test its support level of 25600 again.
Trade within a range
Daily Derivative Outlook 23rd Nov 2017
• Nifty (Nov) futures closed at a Premium of 15.65 points versus a premium of 25.00 points.
• Maximum Call buying was seen at Nifty 10300 strike and Maximum Put buying was seen at Nifty 10100 strikes.
• Maximum positions are at 10500 CE and 10300 PE.
• BATAINDIA (21%), JETAIRWAYS (21%), SUNTV (20%), ZEEL (18%) and MOTHERSUMI (13%) were the top gainers in terms of open interest.
• IBREALEST (-9%), WOCKPHARMA (-9%), PAGEIND (-7%), TITAN (-7%) and CUMMINSIND (-7%) were the top losers in terms of open interest.
• Advance Decline ratio in F&O segment was at 0.90, Advance (90) + Decline (127) + Unchanged (1) = 218
Derivative Idea (23-11-2017)
India Cement Gain 3.00% of open interest as long build up on Wednesday trade. On Daily chart India Cement is trading near immediate resistance level on the upper side with noticeable rise in volumes.
Now what to expect??
Hurdle at 179, Break and sustain above 179 will take it to 190--195 and then to 200++ mark in days to come.
169 will act as major support.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (23rd Nov 2017)
Buy India Cement above 179 with stop loss of 169 for the initial target 190--195 and then to 200+ mark.
Tata Power - Top Pick
Yesterday Tata Power shown more than 1% upside move
According to bollinger bands, tatapower has hit the upper band which is a positive signal. Also TPWR’s endeavour to prune debt, if successful, could be a key trigger for the stock.
Now what to expect???
Tata Power has a hurdle at 93.70 break and sustain above 93.70 will see rally till 97---99++ in days to come. Further upside will see if closes above 99.
Support intact at 90.50
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (23rd Nov 2017)
Buy Tata Power above 93.70 with stop loss below 90.50 (on a closing basis) Target 97—99 mark
More Will Update Soon!!
