Daily Derivative Outlook 6th July

• Nifty (Jul) futures closed at a Premium of 10.75 points versus Premium of 7.70 points.

• Call writing was seen at 9700 strikes, put writing was seen at 9500 strike.

• Maximum positions are at 9700 CE and 9500 PE. Nifty is expected to trade in the range of 9500-9700.

• TATACHEM (28%), IBREALEST (23%), ICICIPRULI (22%), PVR (17%) and NESTLEIND (17%) were the top open interest gainers in the market.

• SRTRANSFIN (-9%), HEXAWARE (-6%), TORNTPOWER  (-5%), MINDTREE (-5%)  and JPASSOCIAT (-4%) were the top open interest losers in the market.

• The Nifty Put Call Ratio (PCR) finally stood at 1.25 for July month contract.

•  Around 3.21 lakh shares were added in open interest with increase in price indicating long buildup was observed by market participants in today’s trade.

 •  On the options front volatility index has decreased in today’s trade by around 0.13%. 

Derivative Idea

Biocon added around 1.6% of open interest as Long positions and 36% rise in volumes. On Daily charts, Biocon is trading above 21 and 55 DEMA which indicates upside momentum in biocon. 

Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.

Trading Recommendation

Buy BIOCON (July) Future above 342 Stop Loss 330 Target 360--380++

More will update soon!!

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Update on Nifty levels, Bank Nifty levels and Equity Pick of the day 6th July 2017

Nifty 9,637 /Sensex 31,245/ Bank Nifty 23,352

37 Advances / 14 Declines/ 0 Unchanged

Indian equity benchmarks managed to eke out modest gains

A session after displaying a distressing performance, Indian benchmark indices have managed to eke out moderate gains on Wednesday, tracking positive trade in global markets after focus shifted from geopolitical tensions around North Korea to minutes from the US Federal Reserve’s last policy meeting. Sentiments got a boost after India’s services PMI rose to an eight month high in June at 53.1 as against 52.2 in May of 2017. This was also the fifth consecutive month of expansion as business environment for services sector in the country continued to improve. Some support also came with the report that global & domestic private equity funds have pumped in around $11.3 billion in the country for the first half of the current year ending June 30, making it the record highest foreign direct investment into the country. Adding optimism among investors, an Assocham-APAS study revealed that with the rollout of the Goods and Services Tax (GST), the industry alone is expected to contribute $280 billion to India's Gross Domestic Product (GDP) in the next eight to nine years. According to the chamber, the GST will enable positive structural changes in the ease of doing business, which in turn would propel the growth.

On the global front, Asian equity markets ended mostly higher on Wednesday, as market participants shrugged off geopolitical worries and looked ahead to the release of minutes of the Fed’s June meeting later Wednesday and the outcome of G20 summit, beginning Friday in Germany. Markets also shrugged off data from a private business survey that showed China’s services sector grew at a slower pace in June as new orders slumped, pointing to a softening outlook for the economy. Further, safe haven gold advanced while the yen was little changed after North Korea’s missile launch raised worries the reclusive nation is planning to build a device to attack the United States mainland. Meanwhile, European stocks grappled for direction in early trade, as losses for pharmaceutical companies and car makers dragged on the region’s indices, even as fresh data painted an upbeat picture of the Eurozone economy.

Back home, the market breadth remained optimistic, as there were 1706 shares on the gaining side against 968 shares on the losing side, while 142 shares remained unchanged.

FII’s Activity 5-July-17

The FIIs as per Wednesday’s data were net sellers in equity and debt segments both, according to data released by the NSDL.

In equity segment, the gross buying was of Rs 3759.80 crore against gross selling of Rs 4918.33 crore. Thus, FIIs stood as net sellers of Rs 1158.53 crore in equities.

In the debt segment, the gross purchase was of Rs 159.68 crore with gross sales of Rs 1016.95 crore. Thus, FIIs stood as net sellers of Rs 857.27 crore in debt.

Now what to expect??

Nifty Levels

Above 9650 will see rally till 9680---9720 mark. 

Panic will see only close below 9580 level only

Bank Nifty Levels

Support at 23000 and resistance at 23500

Above 23430 will see further upside rally till 23500. Close above 23500 will see sharp upside rally till 23800---24000 mark.

Support and stop loss below 23000 on closing basis. 

Trade with levels only

Today's Top Pick

RCF

Above 79 will see upside rally till 84--89++ mark in days to come.

Looks bearish only if close below 73. 

Any sharp downside fall will be buying opportunity in it. 

Corporate Action Ex-Date Today

Pc Jeweller Limited- Bonus 1:1

The Karnataka Bank Limited-Annual General Meeting/Dividend - Rs 4/- Per Share

Bajaj Auto Limited- Annual General Meeting/Dividend - Rs 55/- Per Share

Axis Bank Limited-Annual General Meeting/Dividend - Rs 5/- Per Share

Bata India Limited-Annual General Meeting/Dividend - Rs 3.50 Per Share

Bank Of India-Annual General Meeting

Vedanta Limited-Annual General Meeting

Bajaj Finance Limited-Annual General Meeting/Dividend - Rs 3.60/- Per Share

Bajaj Finserv Limited-Annual General Meeting/Div-Rs 1.75 Per Share

More Will Update Soon!!

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Agro Commodity Update (05-July-2017)

Fundamental Aspect

Monsoon Alert: Heavy rains are expected in parts of central India on Saturday and Sunday. Heavy rains are "very likely" over parts of east Madhya Pradesh subdivision and Chhattisgarh during the period. Paddy, soybean and pulses are among the major crops grown in central India during kharif season and rains at this time are expected to aid sowing of these crops. Rain very likely at most places along west coast and over northeaster states and East India.

Soybean futures traded with higher note on expectation of good physical buying due to rally in edible oils. Moreover, lower pace in physical arrivals and lower sowing data compared to last year also support prices. As per the trader source, arrivals of soybean during last week were down 37% to 39,588 tonnes as compared to 62,976 tonnes in the previous week. Area under soybean crop across the country for the 2017-18 kharif was 15.58 lakh hectares till last week, down about 19% on year. Last year, the acreage was 18.92 lakh hectares.

Turmeric price traded with lower bias yesterday due to fresh selling by the market participants due to supportive rains in turmeric growing areas. Recently good physical demand and diminishing arrivals in June supported bullish move last month. As per trader source, about 27,448 tonnes arrived in June compared to 73,436 tonnes during last month. In Telangana, turmeric acreage as on 03-Jul-17, down 22% to 14,000 hectares as compared to last year acreage of 18,000 hectares. The normal acreage is close to 47,000 hectares. Market arrivals dropped about 60% in June compared to May. As per spice board, increased global demand for turmeric, especially in the pharmaceutical sector, drove its exports to attain figures of 1, 16,500 tonnes in volume and crossed Rs 1,241 crore in value terms in 2016-17.

Guar complex traded with lower bias as developing favourable weather condition for further advancement of monsoon across India may weigh down on prices. Sowing is likely to commence in Haryana and will start in Rajasthan in starting weeks of next month. Market is running with adequate availability of guar stocks whereas higher planting prospects for upcoming season could keep prices under pressure. Moreover, prices may track cues from weakness in crude oil prices which may affect the overseas demand of guar gum adversely. India exported about 54392 MT of guar gum during month of April, 2017 higher by 134% of last year export of 23158 Mt for corresponding time.

Technical Aspect: (July Contract)

Guarseed

Support seen at 3150 and resistance intact 3260.

 More and more upside rally will see only close above 3260 mark else it could test it's support level of 3150 again

Fresh selling can be seen below 3150.

Trade with levels only.

Soyaref 

Support at 641 and resistance is 649.

Trading in range either side breakout with volumes will decide further

Trade with levels only.

Dhaniya 

Our sell call of Dhaniya from 5150 to 4800 proven great and made a low of 4711 today.

Now what to expect?

Support is 4700 and resistance is 4920.

Close below 4700 will see further downside panic towards 4620 and then 4550 mark else could touch its resistance level of 4920.

Fresh buying can be initiated above 4920. 

Trade with levels only.

RM Seed 

We are hold long from 3550 and made a high of 3618 today…

What to expect??

Support seen at 3450 and resistance is at 3650.

Looks positive and every dip towards 3550 will accumulate buying which will take it to 3650 mark.

Fresh selling can be initiated below 3450.

Trade with levels only.

Mentha oil 

Support at 880 and resistance is at 902. 

Looks positive and close 902 will take it to 918 and 932 mark in near term else could touch its support level of 880.

Fresh selling can be initiated below 880 mark.

Trade with levels only.

CPO (June)

Below 486... Panic remain continue till 478---475 and then to 470 mark

Hurdle at 490.50

Trade with levels only.

More will update soon!!

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Technical Pick– Lotus Eye Care Hospital Ltd.

Technical View – Lotus Eye Care Hospital Ltd.

• Lotus Eye Care Hospital is finding support at 26 and resistance above 37. On Daily chart, Lotus Eye Care Hospital is having breakout point above 37. Break and sustain above 37 will see nonstop rally in lotus Hospital till 48++ in weeks to come.

• Lotus Eye Care Hospital, has been trading in a broader range of 14-39 for last one year.

• Daily 14 period RSI has turned up from near levels. As per the bullish high low theory of 40-70 levels, the daily RSI is expected to move up to 70- 75 levels from the current reading of 64. This could mean Continuation of upside momentum in the stock price ahead possibly a breakout also this time.

• MACD too has given the positive crossover (Buy signal) which indicates that upper side seems certain in it.

• Traders don’t go for aggressive or positional selling at all because trend looks positive and we expect rally to remain continue till 48+++mark in coming weeks. For positional trade, stop loss seeing below 26 on closing basis which in unlikely to breach in near terms.

Trading Recommendation 

Buy above 37 and for the initial upside target of 48++ mark with stop loss below 26 on closing basis.

More will update soon!!

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Technical Pick – JSW steel

Technical View – JSW steel

• JSW steel is finding support at 195 and resistance above 212. On Daily chart, JSW steel is having consolidation breakout point above 212.Break and sustain above 212 will see nonstop rally in JSW Steel till 229--235++ in weeks to come.

• JSW Steel, has been trading in a broader range of 144-212 for last one year.

• Stock was consolidating for the past few months and now has given breakout after which the short term trend is expected to turn bullish.

• Daily 14 period RSI has turned up from near levels. As per the bullish high low theory of 40-70 levels, the daily RSI is expected to move up to 70- 75 levels from the current reading of 68. This could mean Continuation of upside momentum in the stock price ahead possibly a breakout also this time.

• Traders don’t go for aggressive or positional selling at all because trend looks positive and we expect rally to remain continue till 229--235+++mark in coming weeks. For positional trade, stop loss seeing below 195 on closing basis which in unlikely to breach in near terms. 

Trading Recommendation

Buy JSW Steel above 212 and for the initial upside target of 229—235++ mark with stop loss below 195 on closing basis.

More will update soon!!

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Currency Report 5th July 2017

Rupee appreciates against dollar on Tuesday

Indian rupee appreciated against US dollar on Tuesday, as fresh sale of the US currency by exporters paced up. Local currency got some support with the Railway Minister Suresh Prabhu’s statement that the India’s GDP growth to the tune of 8-9% was expected and the new tax rates would contribute significantly towards this. He also said the Goods and Services Tax (GST) aims at increasing the number of taxpayers and, as the tax revenue rises, the GDP will also increase. Moreover, the local unit was in a sweet spot also because of a weak dollar overseas. On the global front, US dollar pared its loss against yen on Tuesday, with the greenback having been pushed lower as news of North Korea’s missile testing prompted haven bids for Japan’s currency.

USDINR July

Support at 64.75 and Resistance at 65.10

Trading in range either side breakout with volumes will decide further.

GBPINR

Support at 84.10 and Resistance at 84.30

Below 84.10 panic remain continue till 83.60—83.30 mark, else could touch its resistance level of 84.30 again.

Fresh buying can be initiated above 84.30

EURINR

Support at 73.80 and Resistance at 74.25

Below 73.80 will take it to 73.50—73.30 and then to 73.10 mark in days to come else could touch its resistance level of 74.25 again.

Fresh buying can be initiated above 74.20 only.

JPYINR

Support at 57.40 and Resistance at 57.80

Break and sustain below 57.40 will take it to 57.10—57.00 and then to 56.80 mark in days to come else could touch its resistance level of 57.80 mark.

Fresh buying can be initiated

More will update soon!!

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Daily Derivative Outlook 5th July

• Nifty July 2017 futures closed at 9624.05 on Tuesday at a premium of 10.75 points over spot closing of 9613.30.

• Call writing was seen at 9500 & 9700 strikes, put writing was seen at 9400 strike.

• Maximum positions are at 9700 CE and 9400 PE. Nifty is expected to trade in the range of 9350-9700.

• ICICIPRULI (133%), NATIONALALUM (34%), SRTRANSFIN (20%), CHENNPETRO (17%) and

MANAPPURAM (17%) were the top open interest gainers in the market.

• TATACHEM (-6%), VOLTAS (-6%), APOLLOTYRE (-6%), TORNTPOWER (-4%) and JPASSOCIAT (-4%) were the top open interest losers in the market.

• The Nifty Put Call Ratio (PCR) finally stood at 1.17 for July month contract.

• Around 4.68 lakh shares were added in open interest with increase in price indicating long-buildup was observed by market participants in today’s trade.

• On the options front volatility index has increased in today’s trade by around 1%.

Derivative Idea

Amaraja Batteries added around 14% of open interest as Long positions. On Daily charts, Amaraja Batteries has given symmetrical triangle breakout at 860 level with increase in volumes too.

Current chart pattern and derivatives data suggest that we expect further rally in coming sessions.

Trading Recommendations

Buy Amaraja Battery (July) Future above 865 Stop loss 840 Target 880—900++

More will update soon!!

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Update on Nifty levels and Bank Nifty levels of the day 5th July 2017

Nifty 9,613 /Sensex 31,209/ Bank Nifty 23,214

21 Advances / 30 Declines/ 0 Unchanged

Indian equities end a lackluster session with modest cut

It turned out to be a dismal performance from the benchmark indices on Tuesday, as they failed to snap the session in the positive territory and settled marginally below the neutral lines. The frontline indices took a breather, a session after showcasing a scintillating performance, as market participants turned cautious after North Korea test-launched an intermediate-range ballistic missile days before leaders from the Group of 20 nations are due to discuss steps to rein in Pyongyang's weapons programmes. On the domestic front, fear of uncertainty over the implementation of the Goods and Services Tax (GST) has cast its shadow on manufacturing activities as growth in the sector fell to a four-month low in June, showed the widely-tracked Nikkei purchasing managers' index (PMI). The PMI dropped to 50.9 in June from 51.6 the previous month, as a softer rise in new orders resulted in weaker growth in production. However, losses in the benchmark indices were capped with the Railway Minister Suresh Prabhu’s statement that the India’s GDP growth to the tune of 8-9% was expected and the new tax rates would contribute significantly towards this. He also said the GST aims at increasing the number of taxpayers and, as the tax revenue rises, the GDP will also increase. Some support also came with the report that the Financial Stability Board (FSB), an international body for global financial system, placed India in the league of countries that are ‘compliant or largely compliant’ on implementation of priority area reforms.

On the global front, Asian markets ended lower on Tuesday, as oil prices dipped after eight days of gains and North Korea launched a ballistic missile into the waters between Korea and Japan- its first such launch in more than a month - which comes on the eve of Independence Day in the US. Further, Chinese shares edged lower,  as investors booked some profits after recent gains following US index provider MSCI's decision last month to include China-listed stocks in its Emerging Markets Index. Meanwhile, Australia's central bank left interest rates unchanged on Tuesday and stuck to a neutral tone on policy despite recent signs of improvement in the economy and a swing toward more hawkish guidance among its global counterparts.

Back home, telecom stocks came under selling pressure after telecom group GSMA said that the disruptive pricing due to heightened competition in the Indian telecom space would continue for at least another year and the situation is no different from other markets where carriers were cutting tariff to beat competition. Auto stocks declined on reports that the Maharashtra government decided to increase tax on the registration of all new vehicles by 200 basis points. The tax increase is an attempt to compensate for the revenue loss that the state treasury will incur due to the abolition of octroi and local body tax from July 1, 2017. However, energy heavyweights such as Reliance Industries, Bharat Petroleum and ONGC gained on account of lower crude oil prices.

FII’s Activity 4-July-17

The FIIs as per Tuesday’s data were net sellers in equity and debt segments both, according to data released by the NSDL.

In equity segment, the gross buying was of Rs 3532.61 crore against gross selling of Rs 4428.71 crore. Thus, FIIs stood as net sellers of Rs 896.10 crore in equities.

In the debt segment, the gross purchase was of Rs 242.78 crore with gross sales of Rs 1721.61 crore. Thus, FIIs stood as net sellers of Rs 1478.83 crore in debt.

Now what to expect??

Nifty Levels

Above 9650 will see rally till 9680---9720 mark. 

Panic will see only close below 9500 level only

Bank Nifty Levels

Support at 23000 and resistance at 23500

Close above 23500 will see sharp upside rally till 23800---24000 mark.

Support and stop loss below 23000 on closing basis. 

Trade with levels only

Corporate Action Today

Zee Entertainment Enterprises Limited- Annual General Meeting/Dividend- RS 2.50  Per share

Motherson Sumi Systems Limited- BONUS 1:2

Dabur India Limited-Annual General Meeting/Dividend - Re 1/- Per share

More will update soon!!

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Faster Approvals By U.S. FDA To Hurt Indian Drugmakers, Says Credit Suisse

Indian pharmaceutical firms must brace for more price erosion in the U.S. generic market due to a “sharp surge” in new drug approvals, according to Credit Suisse.

Abbreviated New Drug Approvals by the U.S. Food and Drug Administration are up over 30 percent over 2016 and 40 percent in the last two months, analyst Anubhav Aggarwal wrote in a note to clients. “But more approvals are yet to come and we stay negative,” Aggarwal added.

There are four reasons why the approvals are likely to increase going forward, according to Credit Suisse:

FDA has more resources now.

FDA now is focusing on increasing productivity by reducing iterations.

Around 8 percent of facilities have a warning letter and not yet adding to approvals.

Backlog queue is still expanding, and as the FDA starts clearing the backlog, approvals should pick up.

Faster approvals will hit Indian drugmakers due to four reasons, said the brokerage:

Close to 30 percent of approvals are going to new entrants.

The FDA is changing priorities from number of approvals to impact of approvals.

Risk for high margin drugs is high with approval timelines reducing from 40 plus months to 15-18 months.

(https://www.bloombergquint.com/markets/2017/07/04/credit-suisse-maintains-negative-view-on-pharma-space)

More will update soon!!

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