Update on Nifty levels, Bank Nifty levels, Derivative Outlook and Equity Pick of the day 29th Nov 2017
Nifty 10370 /Sensex 33618/ Bank Nifty 25846
19 Advances / 31 Declines/ 0 Unchanged
Markets snap eight session winning streak on profit booking
Indian equity benchmarks ended the Tuesday’s trade with a cut of around one third of a percent, as traders opted to book profit after eight day winning streak ahead of November derivatives expiry and release of September-quarter GDP data later in the week. Markets started the session on pessimistic note on report that tax collection under the Goods and Services Tax (GST) was lower at Rs 83,346 crore in October, against a mop-up of over Rs 90,000 crore in September. The Finance Ministry said that total collection stood at Rs 83,346 crore till November 27 for the month of October and 50.1 lakh returns were filed for the month. Sentiments also remained dampened with rating agency CRISIL enlightening that India’s competitiveness in the labour intensive export sectors has been on a declining path in the last decade and needs significant structural reforms that need to be addressed. The agency analyzed the competitiveness of the labour intensive export sectors namely, gems & jewellery, leather & leather products and readymade garments which showed that these have become less competitive over the last decade.
However, markets witnessed recovery and gained green terrain with traders taking some solace with report that the government sticking to its promise to lower the tax burden on India Inc is exploring the possibility of reducing the corporate tax rates for larger firms as well. The exact quantum of the cut in corporate tax rate is expected to be finalised closer to the presentation of the Union Budget 2018-19, but revenue implications also have to be factored in. Some comfort also came with report that Asian Development Bank is expecting the Indian economy to pick up in the coming quarters and grow by 7 per cent this fiscal. Meanwhile, the Industry body, Federation of Indian Chambers of Commerce and Industry (FICCI) in its latest Economic Outlook Survey forecasted India's GDP growth to improve to 6.2 percent in Q2FY18 and rise further to 6.7 percent in Q3FY18. Though, the recovery proved short lived with selloff in last leg of trade once again pulled key gauges back into red trajectory to end near intraday lows.
On the global front, European markets were trading in green in early deals, as concerns over political tensions in German subsided and market sentiments improved. Asian markets exhibited mixed trend, as the Japanese government stuck to its moderately upbeat view on the economy in November, its monthly economic report showed, saying it remained on a recovery path helped by consumer spending and business investment.
Back home, stocks related to telecom sector edged lower despite reports that the Telecom Regulatory Authority of India (Trai) will issue recommendations on net neutrality. Banking stocks remained under pressure on ICRA’s report that banks credit provisions are likely to surge to Rs 2.4-2.6 trillion in fiscal 2018 compared to Rs 2 trillion last year due to provisioning for IBC accounts and ageing of NPAs. The report highlighted that the increase in provisioning will result in higher losses for state-run banks during the year. Realty stocks declined on report suggesting that there might be a tax on the unsold inventory held by developers. The real estate industry is in a doldrums situation with so many changes; regulatory and GST etc. It was weathering those blows and this is supposed to be the next one.
FII’s Activity 28th-Nov-17
The FIIs as per Tuesday’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 7521.88 crore against gross selling of Rs 4518.00 crore. Thus, FIIs stood as net buyers of Rs 3003.88 crore in equities.
In the debt segment, the gross purchase was of Rs 603.79 crore with gross sales of Rs 696.82 crore. Thus, FIIs stood as net sellers of Rs 93.03 crore in debt.
Now what to expect ??
Nifty Levels
Below 10350 will see more downside panic till 10320---10275 and then to 10150 mark else it could test its resistance level of 10450 again.
Hurdle intact 10450 and fresh buy can be initiated only above 10450.
Bank Nifty
Below 25800 will see more downside panic till 25700 and then to 25600---25520 mark else it could test its resistance level of 26000 again
Hurdle intact 26000 and fresh buy can be initiated only above 26000.
Trade within a range
Daily Derivative Outlook 29th Nov 2017
• Nifty (Nov) futures closed at a Premium of 7.30
points versus a premium of 18.95 points.
• Maximum Call writing was seen at Nifty 10400 strike and Maximum Put buying was seen at Nifty 10400 strikes.
• Maximum positions are at 10500 CE and 10000 PE.
• DALMIABHA (25%), IGL (18%), ADANIPOWER (16%), BIOCON (15%) and RCOM (14%) were the top gainers in terms of open interest.
• VOLTAS (-14%), CEATLTD (-9%), PIDILITIND (-8%), UPL (-8%) and GODREJIND (-7%) were the top losers in terms of open interest.
• Advance Decline ratio in F&O segment was at 1.65, Advance (88) + Decline (127) + Unchanged (3) = 218
Derivative Idea (29-11-2017)
IndusInd bank losses around 26.00% of open interest as short unwinding on Tuesday’s trade. On Daily chart IndusInd Bank has formed a squat bar while is trading near immediate resistance level 1695 while.
Now what to expect???
Hurdle at 1695, Break and sustain above 1695 will take it to 1750-1780 and then to 1800++ mark in days to come.
1650 will act as major support.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (29th Nov 2017)
Buy IndusInd Bank above 1695 with stop loss of 1650 for the initial target 1750-1780 and then to 1800++mark.
SAIL - Top Pick
As per MACD analysis, giving negative diverges in sail which indicate stock is marginally weak and also trading below the moving averages.
Now what to expect???
Break and sustain below 80.50 will see panic till 77.80---77.00 in days to come. Further downside will see if closes below 77.
Resistance intact at 83.20
Any sharp upside rally will be selling opportunity in it.
Trading Recommendation (29th Nov 2017)
Sell SAIL below 80.50 with stop loss above 83.20 (on a closing basis) Target 77.80—77.
More Will Update Soon!!
