Update on Nifty levels and Derivative Outlook of the day 27th Dec 2017
Nifty 10531 /Sensex 34010/ Bank Nifty 25675
32 Advances / 18 Declines/ 0 Unchanged
Benchmarks hit new record closing highs; Sensex surpasses 34,000 mark
Bulls which woke up in last leg of trade mainly helped the benchmarks to end at fresh all-time closing highs levels on Tuesday, with frontline gauges ending above their crucial 34,000 (Sensex) and 10,500 (Nifty) marks for the first time ever amid thin volume as most traders are away on year-end holiday. The market’s rally was mainly led by ADAG group’s stocks which surged after Anil Ambani’s announcement that the debt-ridden company has achieved full resolution and is expected to reduce its debt of Rs 45,000 crore to Rs 6,000 crore. Earlier, markets after a positive start turned choppy and traded near neutral lines for most part of the day’s trade. Sentiments remained dampened with report that the overseas investors have pulled out a massive Rs 7,300 crore from the country’s stock markets this month so far, primarily due to rising crude prices and widening fiscal deficit. Investors took note that firming crude oil prices in the global market is likely to cast its shadow on retail inflation, which has began to move northwards after hitting a low of 1.46 percent in June, and may prompt the RBI to hold interest rates at least for some time in 2018.
However, markets took U-turn and entered into green terrain in last leg of trade with traders turning optimistic on hopes of revival in quarterly earnings and a favorable Budget. Reports that India looks set to leapfrog Britain and France next year to become the world's fifth-largest economy in dollar terms, too aided sentiments. Traders also took some encouragement with industry body Assocham’s Year-Ahead Outlook report, which has said that India's economic growth may touch 7 percent next year as the government’s policies tilt towards the country’s stress-ridden rural landscape in the penultimate year before the 2019 general elections. It said that against GDP growth of 6.3 percent in the second quarter of 2017-18, the economic expansion may reach the crucial 7 percent mark by the end of September 2018 quarter, while inflation may range between 4 to 5.5 percent towards the second half of the next calendar year with the monsoon being a key imponderable. Some support also came from a private report stating that Indian economy is expected to witness sharp recovery in the January-March quarter and its GDP growth likely to be around 7.5 percent for 2018.
On the global front, Asian markets exhibited mixed trend in a holiday-truncated week as investors remained on the sidelines in the absence of fresh cues. The European markets were closed on account of National holiday.
Back home, shares of Anil Dhirubhai Ambani Group (ADAG) - Reliance Communications, Reliance Infrastructure, Reliance Capital, Reliance Power, Reliance Naval and Engineering, Reliance Home Finance and Reliance Nippon Life Asset Management closed on firm note on back of announcements related to debt reduction issues. However, public sector banking stocks remained under pressure, as according to the Reserve Bank of India (RBI) data, the bad loans problem of public sector banks (PSBs) has once again taken the centre stage, despite the government’s various efforts NPAs of PSBs reached to Rs 7,33,974 crore as of September, 2017, mainly due to corporate defaulters.
FII’s Activity 26th -Dec-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 buying was of Rs 6628.50 crore against gross selling of Rs 7764.06 crore. Thus, FIIs stood as net sellers of Rs 1135.56 crore in equities.
In the debt segment, the gross purchase was of Rs 1299.51 crore with gross sales of Rs 254.14 crore. Thus, FIIs stood as net buyers of Rs 1045.37 crore in debt.
In the hybrid segment, the gross buying was of Rs 0.70 crore against gross selling of Rs 2.72 crore. Thus, FIIs stood as net sellers of Rs 2.02 crore in hybrid.
Now what to expect ??
Nifty Levels
Hurdle at 10550. Three consecutive close + weekly close above 10550 will see sharp upside rally in days to come else it could test its support again.
To know more... Click on the below link and see brief analysis about Nifty future
https://youtu.be/eWObZKP5JhU
Daily Derivative Outlook 27th December 2017
• Nifty (December) futures closed at a premium of -5.55 points versus a premium of 12.45 points.
• Maximum call buying was seen at Nifty 10400 strike and maximum put buying was seen at Nifty 10500 strikes.
• Maximum positions are at 10500 CE and 10000 PE.
• CUMMINSIND (39%), PIDILITIND (22%), TORNTPHARM (21%), HDIL (19%) and JUSTDIAL (14%) were the top gainers in terms of open interest.
• RCOM (-17%), PAGEIND (-15%), FORTIS (-9%), DCBBANK (-8%) and RCOM (-8%) were the top losers in terms of open interest.
• Advance Decline ratio in F&O segment was at 2.00, Advance (142) + Decline (71) + Unchanged (4) = 217
Derivative Idea (27-12-2017)
Sunpharma losses around 28.50% of open interest as short unwinding Monday’s trade. Sunpharma forming symmetrical triangle patter on daily chart having breakout point at 540.00
Now what to expect???
Sunpharma has resistance at 545 above 545 it can touch 570--575 and then to 590++ mark in days to come else could touch its support level of 525.
Fresh selling can be initiated below 525.00 only.
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (27th Dec 2017)
Buy Sunpharma above 545.00 with stop loss of 525.00 for the initial target 570—575 and then to 590 mark
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