Tuesday 30 October 2018

Podcast | Stocks Picks Of The Day Bharat Forge Among Top 3 Bets For Short Term

Posted by suhani varma on Tuesday, October 30, 2018 with No comments


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The market continued its bearish run and tested major psychological marks last week, pressurised by weak domestic cues and not so encouraging earnings announcements.

The news of declining forex reserve, rise in import bills and continuous outflow of foreign funds dented market sentiment. Besides, volatility, mainly due to F&O expiry, added to the worries.


Though the market tried to recoup losses for some time but selling pressure in the last two sessions pushed the bulls completely on the back foot.



Among the benchmark indices, Nifty breached its crucial support at 10,100 and settled around 10,030, down 2.65 percent for the week ended October 26.


However, Monday’s trading session came as a respite for the bulls as the index managed to bounce back over 200 points and closed at 10,250.

Although, earnings have failed to trigger any meaningful rebound so far. Put together, negatives still have an edge despite Monday’s strong rally.

The Nifty has immediate and crucial support at 9,950 and its breakdown would further worsen the situation. In case of rebound, 10,350-10,450 zone would act as a hurdle. We reiterate our view to focus more on stock selection and prefer hedged trades.

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It looks like it was early Diwali celebration on D-Street. Sensex rallied by more than 700 points while Nifty reclaimed 10,200 levels.

The final tally looked like – Sensex closed 718 points higher or 2.15 percent at 34,067 while the Nifty50 rose 220 points to end at 10,250.

Positive global cues, fall in crude oil prices, rally in index heavyweights supported market sentiment.


All the sectoral indices closed in green. Individually, pharma, realty, capital goods, PSU as well as energy stocks rose 3-4 percent.On the results front, as many as 135 companies will declare their results for the quarter ended September 30 which include names like Bank of Baroda, Bhushan Steel, Cummins India, Dena Bank, IDFC Ltd, JK Tyre, Bank of Maharashtra, Tech Mahindra, Torrent Power etc. among others.

Tech Mahindra: PAT likely to grow 34% YoY to Rs 1120 cr

Bank of Baroda: PAT likely to grow by 2.4% YoY to Rs 363 crore

Pidilite Industries: PAT likely to grow by 9% YoY to Rs 275 crore

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Nifty Above 10,250 Mark BPCL, HPCL Drops 3%

Posted by suhani varma on Tuesday, October 30, 2018 with No comments


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Equity benchmark opened lower on Tuesday taking cues from their Asian stocks. After opening lower, the 30-share Sensex recovered to above the psychological 34,000 level.

The Sensex is up 29 points at 34,097 and the Nifty 50 Index is slightly higher seven points at 10,258.

On the sectoral front, Nifty Pharma, Metal and IT saw major losses in today’s session.

Shares of BPCL dropped 4% after Q2 net profit for the quarter declined by 48.3% yoy to Rs1,218.71cr.

Shares of HDFC Bank is trading flat after the private sector lender re-appointed MD and CEO Aditya Puri till October 26th, 2020.

Shares of ICICI Bank extended yesterday’s rally as the bank reported upbeat Q2FY19 numbers. The beat on estimates was mainly on the back of low provisions and better NII growth.

Infosys, TCS, SBI, ICICI Bank and Yes Bank were the contributors to the gainers on Sensex. On the flip side, Reliance Industries, HDFC, ITC and IndusInd Bank lost the most.

Additionally, market breadth was positive on the NSE with 1,146 shares advancing against 448 shares declining, while 447 shares remaining unchanged.

Meanwhile, India VIX, a volatility index based on prices of Nifty options, was trading 0.37% down

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SGX Nifty Indicates Mildly Negative Opening Tracking Global Cues

Posted by suhani varma on Tuesday, October 30, 2018 with No comments

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SGX Nifty is currently trading at 10218, down 57 points. For today, consolidation can be seen as global cues turn weak; however focus will remain be on corporate earnings.

Nifty had a superb rally of over 250 points on Monday with Sensex clocking over 700 points as short covering, better results, and value buying saw the indices clock best rally in 30 months. Better still, the breadth was very impressive with the mid and small cap indices joining the pull back.

Global markets: Asian indices opened mixed with the Japanese Nikkei trading well in the green despite the overnight sharp reversal in the US markets. Oversold indices in Asia may not react much to the President Donald Trump rhetoric this time as most negative news has already been discounted. For today, expect falls to be bought as short covering, and value buying to reemerge.

US markets: US indices have big reversal as Trump threatens more tariffs on China. Dow Jones swings over 900 points intraday as volatility hits markets. Oil prices fall another day, while bond yields trade near 3.08% as money exits equities and chases fixed income.

FII/DII Data: In the yesterday’s trading session, FIIs sold 2230cr stock in the cash market, whereas DIIs bought 2526cr worth of stock. In the derivative market, FIIs bought 279cr of Index futures and bought 2227cr worth of Index options. In the Stock futures segment, FIIs bought 2078cr worth of stock futures and bought 602cr stock options.

FII View: FII built marginally bullish positions in the derivative market, which is deduced by the fact that they created 1208 net long contracts in Index Futures, while simultaneously adding 27162 long contracts in Index Call Options.

FIIOI
(in000's)
% Chg% Chg
Since Expiry
Long/
Short Ratio
Long/Short
 Since Expiry
Index Long10610200.51.1
Index Short23249
Index Call Long19916212.70.9
Index Call Short74(6)32
Index Put Long3384432.81.1
Index Put Short120829

Monday 29 October 2018

SGX Nifty Indicates Gap Up Opening Tracking Global Cues

Posted by suhani varma on Monday, October 29, 2018 with No comments

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SGX Nifty is currently trading at 10,102, up 55 points. For today, expect ICICI Bank to lead the banks with short covering as results beat estimates with sharp reduction in NPA.

Nifty had another weak day on Friday as adventurous shorts drove down the index to close near 10000. This movement was in anticipation of weak US cues, which hurt sentiments and saw the rupee close weaker. Earnings from large corporates have met and beaten estimates showing that earnings are poised to expand going forward.

Global markets: Asian indices opened in the green after witnessing its worst performance last week with most indices almost falling non-stop. For today, expect strong contrarian buying from value investors along with short covering as extremely over sold indices bounce back. Data on manufacturing from China will also see more color as growth has slowed down the economy.

US markets: US indices were on course for the worst October in many years as rise in yields and tariff war overhang hurt sentiment. The US dollar hit fresh highs as the global equity rout saw money chase US assets. Oil prices witnessed a fall for the third successive week as Saudi Arabia assured of more supply in the face of Iran sanctions.

FII/DII Data: In today’s trading session, FIIs sold 1,356cr stock in the cash market whereas DIIs bought 1,875cr worth of stock. In the derivative market, FIIs sold 146cr of Index futures and bought 746cr worth of Index options. In the Stock futures segment, FIIs bought 541cr worth of stock futures and bought 88cr stock options.

FII View: FII continued to maintain their bearish outlook on the domestic market and created bearish positions in the derivative market, which is deduced by the fact that they added 1,824 net short contracts in Index Futures, while simultaneously adding 89,415 long contracts in Index Put Options.

 FIIOI
(in000's)
% Chg% Chg
Since Expiry
Long/
Short Ratio
Long/Short
 Since Expiry
Index Long9710100.41.0
Index Short22455
Index Call Long172552.20.8
Index Call Short783939
Index Put Long32538382.91.2
Index Put Short1122020




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The global sell-off rout continued to weigh on the Indian equity market, keeping them in negative trajectory for an extended period of time. It decisively breached downward from the most important support level in the last closing session.


Both Sensex and Nifty declined about 14 percent each from their earlier peaks on account of this current global sell-off and partly driven by looming concerns in NBFC sector.


In the wake of a market rout, the Nifty index failed to hold 10,100 support levels which remained crucial for the index and slipped to touch a 7-month low of 10,004 levels.A retest of the crucial support placed around 10,000 indicates negative market sentiment. The index declined about 2.7 percent on weekly basis to close at 10,030 levels on Friday.



The drag during the week primarily came from Nifty IT and pharma which were down 5.7 percent and 5.5 percent, respectively. The Nifty realty was the only gainer, up by about 0.5 percent during a week.

The index continued to form a solid bearish candlestick pattern both on weekly as well as on the daily price as it slipped from important support level.

The weekly RSI on the chart stood at 32 levels, while the MACD continued to trade below its signal line. It continues to trade below its crucial moving average, the upper resistance is seen at 10400 levels with next crucial support at 9950 levels.

A weakness in the market is expected to be persistent on the backdrop of negative sentiment globally coupled with constant domestic turmoil on account of liquidity crisis in the financial sectors and nominal earnings growth in Q2FY18 so far.

However, as long as it holds 9,950 levels on closing basis, a marginal pullback is likely in the coming series but it might be capped at 10,400 levels.

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Trade Setup For Monday Top 15 Things To Know Before Opening Bell

Posted by suhani varma on Monday, October 29, 2018 with No comments


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The market fell for a second consecutive day on Friday (October 26), which was the first day of the November series. It ended a volatile session sharply lower, but managed to defend the psychological 10,000 level.

The Nifty 50 opened flat at 10,122.35, but corrected sharply to hit an intraday low of 10,004.55. The index made many attempts to hold 10,100 levels amid volatility, but failed and finally closed 94.90 points lower at 10,030.

The index formed a large bearish candle which resembles a 'Bearish Belt Hold' kind of pattern on the daily charts as well as weekly scale.


A 'Bearish Belt Hold' pattern is formed when the opening price becomes the highest point of the trading day (intraday high) and the index declines throughout the trading day making up for the large body. The candle will either have a small or no upper shadow and a small lower shadow.

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India market witnessed a third consecutive week of fall where both Sensex and Nifty fell by over 2 percent each.


The Nifty50 retested its crucial support at 10,000 but then bounced back.

Both Sensex and Nifty slipped by about 14 percentfrom highs.

The Nifty index failed to hold 10,100 support levels which remained crucial for the index and slipped to touch a 7-month low of 10,004 levels.


As many as 96 companies on the BSE will declare their results for the quarter ended September later today which include names like BPCL, Colgate Palmolive, Gruh Finance, 




HDFC Asset Management Company, Tata Power, Union Bank of India, Vijaya Bank etc. among others.


BPCL: PAT likely to fall by 30% YoY to Rs 1645 crore

Colgate Palmolive: PAT likely to grow by 14% YoY to Rs 203 crore

Union Bank of India: PAT likely to fall by 2.1% YoY to Rs 2.3 crore


Tata Power: PAT likely to grow by 22% YoY to Rs 469 crore

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Friday 26 October 2018

Nifty Suffers Worst Loss In October Series Since 2008

Posted by suhani varma on Friday, October 26, 2018 with No comments


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The October series started on lighter positions as open interest (OI) in Nifty was at the lowest level seen in the last one year. The bearish momentum of September series was seen in October series, too, as our market continued to make lower lows in the first fortnight of October expiry.

However, we witnessed some relief rally in the latter half. But, the Nifty failed to sustain at higher levels and nosedived again below the previous swing low of 10,138.


The Nifty ended the October series with a massive loss of 7.77 percent over its September expiry. After October 2008, this is the biggest fall in the Nifty in an expiry month in terms of total losing points.


The fall was supported by fresh short positions and the same got carried forward to November series as rollovers in Nifty stood at 75.83 percent, which is above its quarterly average of 68.21 percent.

On a month-on-month basis, the open interest has increased by 28.34 percent. The foreign institutional investors (FIIs), too, participated in the ongoing fall as they turned net seller in cash market segment on almost all trading sessions (except two) in October series and cumulatively sold equities worth Rs. 25,528 crores.

They also formed a good amount of short positions in the index futures and as a result, their ‘Long Short Ratio’ in the index futures has fallen from 46.10 percent to 29.20 percent, which is at the lowest point in the last six months.

On the options front, 11,000 - 10,500 call writers are active; while we are witnessing decent writing in 10000 and 10200 put options in the November series.

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A weak day for India markets as Sensex slipped below 33700 while Nifty closed below its crucial support at 10,138 on the expiry day, weighed down by weak global cues.


Nifty Fut rollovers on a provisional basis stood at 75 percent for November series which is higher than 3-month avg of 68 percent and October series rollover of 62 percent. 


Most Asian stocks declined as concerns mount that corporate profits and economic growth are peaking amid rising borrowing costs. 



The finally tally – Sensex closed 343 points down at 33,690. The index has plunged 7 percent or 2537 points so far in the month of October. The Nifty50 closed 99 points down at 10,124.All the sectoral indices on the National Stock Exchange closed in the red. 




On the technical front, the selling pressure is likely to aggravate once the index breaks the key support zone of 10000-9952.


A breach of the support zone shall allow the index to tumble further till 9700 in the short term.


On the other hand, the bears are expected to keep the index below the crucial hurdle zone of 10250-10290.



Big News:

On the earnings front, as many as 80 companies will be reporting their results for the quarter ended September which include names like Bharat Electronics, Dr Reddy’s Laboratories, Edelweiss Financial Services, ICICI Bank, ITC, Nestle India, PI Industries, and UPL among others.


ITC: PAT is likely to grow by 13% on YoY basis to Rs 2990 crore


ICICI Bank: PAT likely to fall by 75% on a YoY basis to Rs 497 crore


Dr Reddy’s Laboratories: PAT likely to grow by 12% YoY to Rs 319 crore


(All the estimates are from Motilal Oswal)


Technical View:


Nifty formed a Doji kind of pattern on daily charts


India VIX gained 2.27 percent at 19.31 levels.


The Nifty ended the October series with a massive loss of 7.77 percent over its September expiry.


After October 2008, this is the biggest fall in the Nifty in an expiry month in terms of total losing points.


Rollovers in Nifty stood at 75.83 percent, which is above its quarterly average of 68.21 percent.


Data suggests that the fall was supported by fresh short positions and the same got carried forward to November series.


Max Call OI: 11000, 10500


Max Put OI: 10000, 10200


Technical Recommendations:


We spoke to ICICIDirect and here’s what they have to recommend:


State Bank of India: Buy| LTP: 249| Target: Rs 298| Stop Loss: Rs 237| Return 19.6%| Time 6 months


Tata Steel: Buy| LTP: Rs 546| Target: Rs 625| Stop Loss: Rs 520| Return 14%| Time Frame 6 months

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The Nifty50 formed a Doji-like candle on Thursday which signals indecisiveness among bulls and bears. However, the demand emerged at major support areas of 10,100.

We expect the index to undergo a base formation with positive bias amid elevated volatility in the broad range of 10,100-10,450 in the coming weeks.

Historically, within a structural uptrend, secondary corrections of 12-15% are considered normal bull market corrections that provide long-term buying opportunities.

Time-wise, since the beginning of CY18, each directional leg in the Nifty has lasted for seven to eight weeks. In the present scenario, the index has maintained the rhythm by correcting for a seven successive week.

As we are in the eighth week, with 14 percent correction over the past seven weeks already behind us, we expect the index to maintain its rhythm and the ongoing corrective decline to mature as we approach price/time wise maturity.

The immediate hurdle for the index is placed around 10,450-levels — being the confluence of the current week high and the bearish gap area of last Friday.



The Nifty50 is placed at its long-term trend line support amid oversold readings of momentum oscillator (around 10).

We believe the index will hold the trend line and undergo base formation in coming weeks. Thus, investors should utilise the current decline to accumulate quality stocks in a staggered manner.

Nifty has major support at 10100-10150 levels being the confluence of the following technical parameters:

a) 80 percent retracement of the September 2017 and August 2018 rally (9688-11760) at 10100

b) The recent low of the first week of October also placed at 10138 level

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