Update on Nifty levels, Bank Nifty levels, Derivative Outlook and Equity Pick of the day 10th Jan 2018
Nifty 10637 /Sensex 34352/ Bank Nifty 25676
19 Advances / 31 Declines/ 0 Unchanged
Markets hit fresh record closing highs; eke out slender gains
Extending winning streak for fourth straight day, Indian equity benchmarks once again settled at fresh record closing high levels, though gains remained minimal with traders turning cautious ahead of the corporate results season kicking in this week. Markets traded mostly in green during the day with traders taking some support from report that the Commerce and Industry Ministry is mulling incentives for States that play a proactive role in promoting exports as it will help boost economic growth. However, markets entered into red in noon deals with sentiments turning down-bear with report that Moody’s Investors Service and its Indian arm ICRA in a joint report have flagged anxiety about the growing delinquencies in the affordable housing segment, which are expected to continue in the calendar year 2018. Sentiments also remained dampened with the rating agency Crisil attributing the continuing slowdown to the after-effects of the demonetisation exercise, the Goods and Services Tax (GST) implementation and weakness in agriculture, rating agency, CRISIL in its latest report has maintained its projection of India's economic growth in 2018-19 to 7.6 percent on the low base.Recovery in last leg of trade mainly helped markets to end at fresh record closing high levels with traders taking some solace with report that the government’s revenue collection continued its rising trend, mainly on account of income tax mop-up from individuals. India’s net direct tax collections, which are made up of personal and corporate taxes, rose to Rs 6.56 lakh crore during the April-December period of the financial year 2018. The collection indicates that 67% of the annual budget target of direct taxes (Rs 9.8 lakh crore) has been achieved.Firm opening in European counters too provided some support to domestic markets amid investors eyeing the release of a number of economic reports out of the euro zone. The unemployment rate in the euro zone fell as expected in November. Asian markets exhibited mixed trend, while the yen stole the currency spotlight and jumped after the Bank of Japan’s slight reduction to its bond purchases reminded investors that it will eventually normalize policy.
Back home, companies related to FMCG space edged higher with a private report stating that in the next 12 months, consumer goods companies would see a revival, both in volume and margin terms, with an anticipated revival in the rural sector. Cigarette stocks too edged higher despite the Supreme Court staying a Karnataka High Court order quashing 85% pictorial warnings on packs containing such products. However, select stocks in housing loans and banking space remained under pressure after a report flagged concerns about the growing delinquencies in affordable housing segment.
FII’s Activity 9th-Jan-18
The FIIs as per Tuesday’s data were net buyers in equity and debt segments both, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 5662.53 crore against gross selling of Rs 5064.02 crore. Thus, FIIs stood as net buyers of Rs 598.51 crore in equities.
In the debt segment, the gross purchase was of Rs 2251.09 crore with gross sales of Rs 1365.80 crore. Thus, FIIs stood as net buyers of Rs 885.29 crore in debt.
In the hybrid segment, the gross buying was of Rs 1.72 crore against gross selling of Rs 9.66 crore. Thus, FIIs stood as net sellers of Rs 7.94 crore in hybrid segment.
Now what to expect ??
Nifty Levels
Support at 10430 and Resistance at 10660
Above 10660 will see rally till 10750---10900 mark else could touch its support level of 10430 again
Trade with levels only
Bank Nifty
Support at 25500 and Resistance at 25780
Above 25780 will see rally till 26000---26300 mark else could touch its support level of 25500 again
Trade with levels only
Daily Derivative Outlook 10th January 2018
• Nifty (January) futures closed at a premium of 9.90 points versus a premium of 7.80 points.
• BALKRISIND (28%), PAGEIND (18%), NMDC (17%), CUMMINSIND (15%) and RPOWER (14%) were the top gainers in terms of open interest.
• UBL (-29%), NIITTECH (-11), PVR (-10%), ARVIND (-10%) and JERAIRWAYS (-8%) were the top losers in terms of open interest.
• Maximum call buying was seen at Nifty 10700 strike and maximum put writing was seen at Nifty 10600 strikes.
• Maximum positions are at 11000 CE and 10500 PE.
• The Nifty Put Call Ratio (PCR) finally stood at 1.36 for January month contract.
• Advance Decline ratio in F&O segment was at 0.54, Advance (75) + Decline (140) + Unchanged (2) = 217
Derivative Idea (10-01-2018)
Yes Bank losses around 1.54% of open interest as short unwinding on Tuesday’s trade.
Yes Bank has hurdle at 342.50. Break and sustain above 342.50 will it to 355—360 and then to 365++mark in days to come, further upside rally will see on close above 365 mark, else could touch its support level of 328.50 again.
Fresh selling can be initiated below 328.50
Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.
Trading Recommendation (10th Jan 2018)
Buy Yes Bank future above 342.50 with stop loss of 328.50 for the initial target 355--360 and then to 365++ mark
Petronet Lng Limited.- Top Pick
Petronet Lng taking support upward trend line if unable to breach it then we can expect upside rally in it
Now what to expect???
On Daily chart, Hurdle at 258.50 will see rally till 263.50--265 in weeks to come.
Support intact at 253.50.
Any sharp downside panic will be buying opportunity in it.
Trading Recommendation (10th Jan 2018)
Buy Petronet Lng above 258.50 with stop loss below 253.50 (on a closing basis) Target 263.50—265.
More will update soon!!
