KIFS Trade Capital

Published on 25/01/2020 5:03:22 PM

Market Outlook For 27 January 2020

Bank Nifty

Form past two week bank nifty index has underperformed the key benchmark index by falling 1.10% and forming a bear candle. Technically, on lower time frame mainly on daily price chart the index is unfolding into expanding triangle pattern where the index was trading near the triangle support, here the index also formed a bullish harami candle stick pattern where bulls managed to lead the rally. We may see index trading with support of 30625 and resistance of 31900 level.

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KIFS Trade Capital

Published on 25/01/2020 5:02:53 PM

Market Outlook For 27 January 2020

Nifty

For the week key benchmark index formed a bear candle due to coronavirus outbreak in china & mixed earning results kept managed to keep lid on market. In upcoming sessions we may see index giving a pre-budget rally. On technical front on lower time frame mainly on daily price chart the index is unfolding into expanded triangle pattern. Here we may see index moving in range of 12000 level to 12400 level in upcoming trading session breakout on either side will decide the further trend direction.

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Motilal Oswal Financial Services Ltd

Published on 24/01/2020 6:04:35 PM

Technical Commentary

Nifty index opened flattish but witnessed buying interest throughout the entire trading session. The benchmark indices took support around the 50 DEMA on daily chart and moved higher for second consecutive session. It negated its formation of lower highs after four trading sessions which indicates strength. It formed a Bullish Candle on daily chart whereas Bearish Engulfing get formed on Weekly scale, which implies that supply is visible at higher levels; but at the same time decline is being bought into. Momentum oscillator RSI is also took support around its recent swing lows of 44 - 46 zone and turned northwards. Going forward, if Nifty holds above 12150 levels, then an up move towards 12300 and 12350 cannot be ruled out. However, major support remains intact at 12100 and 12050 levels.

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LKP Securities

Published on 24/01/2020 5:17:18 PM

Bourses Sustain Robust Gaining Rally On Friday

Indian equity bourses sustained their gaining rally on Friday, with Sensex & Nifty ending higher by around 0.55% each. The start of the day was on a cautious note, amid a private report that government's tax revenue shortfall for FY20 is estimated to be at around Rs 2 lakh crore. The revenue shortfall from direct tax sources is being pegged at around Rs 1.5 lakh crore to Rs 1.8 lakh crore, while that from indirect sources is estimated to be at around Rs 30,000 crore to Rs 60,000 crore. But soon, indices staged sharp recovery, as RBI raised the investment limit for foreign portfolio investors in government & corporate bonds.

Key benchmarks remained in green terrain with strong gains for the most part of the trading session, on the back of firm cues from the global markets. Traders got encouragement, with  a private report stating that deal activity by private venture investors grew by 28 per cent to $48 billion in 2019, propelled by infrastructure bets, but will slow down to under 20 per cent in 2020. Some support also came with reports that the government think-tank Niti Aayog will develop a national data and analytics platform to make all government data accessible to stakeholders in a user-friendly manner.

On the global front, European markets were trading in green terrain, after the euro area private sector grew at the same moderate pace as seen in the final month of 2019. The survey data from IHS Markit showed that the composite output index held steady at 50.9 in January. Asian markets ended mostly higher, as Japan's private sector rebounded at the start of 2020, driven by the expansion in services output. The flash survey results from IHS Markit showed that the Jibun Bank flash composite output index rose to 51.1 in January from 48.6 in December. A score above the neutral 50 indicates expansion.

Back home, Auto stocks ended higher, even after credit rating agency, ICRA said that demand for two-wheelers in the domestic market is likely to remain weak in the near-term on the back of implementation of BS-VI norms. Further, Oil & Gas sector stocks remained in focus, as Oil Minister Dharmendra Pradhan said that India will see an investment of over Rs 4 lakh crore in development of gas supply and distribution infrastructure in the next five years as it chases the target of more than doubling the share of the environment-friendly fuel in its energy basket to 15 percent by 2030.

Finally, the BSE Sensex gained 226.79 points or 0.55% to 41,613.19, while the CNX Nifty was up by 67.90 points or 0.56% to 12,248.25.

The BSE Sensex touched high and low of 41,697.03 and 41,275.60, respectively and there were 22 stocks advancing against 08 stocks declining.

The broader indices ended in green; the BSE Mid cap index rose 0.77%, while Small cap index was up by 0.50%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.50%, Consumer Durables up by 1.33%, Basic Materials up by 1.04%, Metal up by 0.98% and Industrials up by 0.96%, while Energy down by 0.14% and Oil & Gas down by 0.02% were the only losing indices on BSE.

The top gainers on the Sensex were Ultratech Cement up by 2.47%, Tech Mahindra up by 2.43%, Larsen & Toubro up by 2.03%, Axis Bank up by 2.01% and Kotak Mahindra Bank up by 1.98%. On the flip side, Power Grid down by 2.14%, Indusind Bank down by 1.21%, Sun Pharma down by 0.49%, TCS down by 0.40% and Reliance Industries down by 0.35% were the top losers.

Meanwhile, union minister Piyush Goyal has asserted that the Indian economy is well-poised to take off and the government is committed to ensure economic growth. He noted that there is a lot of enthusiasm for making investments in the country. He said ‘Britain is set to leave the European Union by the end of January.... things have once again started showing an uptrend... economy is well poised to take off from here.’

Talking on Regional Comprehensive Economic Partnership (RCEP), the minister said it was an unbalanced trade agreement, which was really not fulfilling the guiding principles on which RCEP started about eight years ago, therefore India chose not to participate in it. He also said ‘out of the RCEP countries India already has bilateral trade agreements with ASEAN 10 with Japan and Korea, we are close to concluding negotiations with Australia which we have restarted now and in the next 6 to 8 months we are can close a bilateral trade partnership with Australia.’

Goyal further said ‘RCEP was effectively becoming a free trade agreement between China and India. I don’t think India is ready to engage unless we see open government, better transparency, regulatory practices being followed, and greater market access for Indian goods and services on a reciprocal basis.’

The CNX Nifty traded in a range of 12,272.15 and 12,149.65. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 3.91%, Ultratech Cement up by 2.58%, Britannia up by 2.44%, Tech Mahindra up by 2.33% and Axis Bank up by 2.21%. On the flip side, Power Grid down by 2.45%, Cipla down by 1.38%, Indusind Bank down by 1.06%, Tata Motors down by 0.80% and BPCL down by 0.64% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 107.91 points or 1.44% to 7,615.58, France’s CAC rose 83.95 points or 1.41% to 6,055.74 and Germany’s DAX was up by 175.82 points or 1.31% to 13,564.24.

Asian markets ended mostly higher on Friday after the World Health Organization (WHO) announced it was a bit too early to declare the coronavirus a global health emergency. The death toll in China has now risen to 26, while the number of confirmed cases jumped to 830. Multiple cases of the virus have been confirmed in Thailand, Vietnam, South Korea and Japan, while the United States, Taiwan and Singapore have each reported one case. Japanese shares closed higher after the release of macroeconomic data. Japan's inflation accelerated in December but remained well below the 2 percent target, a government report showed. Consumer price inflation increased to 0.8 percent from 0.5 percent a month ago and against forecast of 0.7 percent. While, flash survey results from IHS Markit revealed that Japan's private sector rebounded at the start of 2020, driven by the expansion in services output. The corresponding index rose to 51.1 in January from 48.6 in December. The services PMI advanced to 52.1 from 49.4 a month ago. The factory PMI also climbed in the month but held below 50. Moreover, Hong Kong shares ended slightly higher in a shortened trading session ahead of the Year of the Rat. Meanwhile, markets in China, South Korea and Taiwan were closed for the Lunar New Year holidays.

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Emkay Global Financial Services Ltd

Published on 24/01/2020 3:54:26 PM

Roll Color – Pre-expiry Week

* Nifty rollover at 15% compared with last 3-month average of 12% and market-wide rollover at 15%, marginally higher from last 3-month avg. level; Nifty roll is currently trading at 37-38 points on screen, which is 5 points higher from the fair value. Expected dividend in the month of January is INR15 (excluding COAL and ONGC on account of our expectation of div exceeding 5% threshold).

* Market-wide OI stands at 4.8bn shares, ~11% higher from last month’s OI at same time; BANKNIFTY OI has increased by 7% and stands at 1.59mn shares and NIFTY OI at 14.8mn shares has been decreased by 5% compared with last month same time.

* FII total positioning in Index Future has been increased significantly by 69%, while FII total positioning in SSF has been increased by 10%; Retail positioning in SSF has been increased by 8% compared with last month same time.

* FII Index Futs - Last month their net long position was 24,000 contracts (74,000 contracts long and 50,000 contracts short), which currently stands at net short of 8,000 contracts (102,000 contracts long and 110,000 contracts short). Their long position has been increased by 37% while short position has more than doubled during the month.

* FII SSF - Last month they were net long of 514,000 contracts (972,000 contracts long and 458,000 contracts short) which currently stands at net long of 430,000 contracts (1004,000 contracts long and 574,000 contracts short). Their long position has been increased marginally by 3% and short position has been increased significantly by 25% compared with last month same time.

* Retail SSF - Last month their net long position was 507,000 contracts (712,000 contracts long and 205,000 contracts short) which currently stands at 579,000 contracts net long (785,000 contracts long and 206,000 contracts short). Their long position has been increased by 10% and short position has been broadly unchanged compared with last month same time.

* We are not seeing any significant up move in NIFTY roll level from here due to: a) current level is higher than fair value; and b) FII net positioning has turned negative to 8,000 lots ( from net long of 24,000 contracts).

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LKP Securities

Published on 24/01/2020 2:12:13 PM

Local bourses hold gains in afternoon deals

The local barometer gauges held their gains in afternoon session, on the back of mostly positive trade in Asian equities coupled with sustained buying by domestic institutional investors. Traders took some solace with Union Commerce and Industry Minister Piyush Goyal’s statement that the Indian economy is well-poised to take off and the government is committed to ensure economic growth. However, further up move got restricted as anxiety remained among the local traders with a private report stating that government's tax revenue shortfall for FY20 is estimated to be at around Rs 2 lakh crore. As per the report, the revenue shortfall from direct tax sources is being pegged at around Rs 1.5 lakh crore to Rs 1.8 lakh crore, while that from indirect sources is estimated to be at around Rs 30,000 crore to Rs 60,000 crore. On the sectoral front, Oil & Gas stocks remained in focus as Oil Minister Dharmendra Pradhan said that India will see an investment of over Rs 4 lakh crore in development of gas supply and distribution infrastructure in the next five years as it chases the target of more than doubling the share of the environment-friendly fuel in its energy basket to 15 percent by 2030.

On the global front, Asian markets were trading mostly in green after the world’s health body called it a little too early to declare a coronavirus outbreak a global emergency. Back home, the BSE Sensex is currently trading at 41519.04, up by 132.64 points or 0.32% after trading in a range of 41275.60 and 41587.18. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.81%, while Small cap index was up by 0.50%.

The top gaining sectoral indices on the BSE were Metal up by 1.21%, Capital Goods up by 1.11%, Consumer Discretionary Goods & Services up by 1.01%, Auto up by 0.91% and Consumer Durables was up by 0.90%, while Telecom down by 1.03%, IT down by 0.55% and TECK was down by 0.54% were the few losing indices on BSE.

The top gainers on the Sensex were NTPC up by 1.89%, HCL Tech. up by 1.57%, ONGC up by 1.49%, Axis Bank up by 1.40% and Larsen & Toubro was up by 1.40%. On the flip side, Power Grid down by 2.16%, Bharti Airtel down by 1.38%, Infosys down by 1.18%, TCS down by 0.68% and Reliance Industries was down by 0.10% were the top losers.

Meanwhile, the rating agency ICRA in its latest report has said that the domestic two wheelers demand is likely to remain weak in the near-term on the back of implementation of BS-VI norms which is expected to further force a 10-12% increase in ownership cost, across segments. It observed that the industry is already facing several headwinds that have adversely impacted sales and the transition to new emission norms will further heighten the already subdued outlook.

According to the report, over the past couple of months, two-wheeler OEMs have started introducing BS-VI compliant variants in the market and ICRA’s analysis of new launches suggest that prices of 2Ws have risen by 10-12 per cent (on the ex-showroom basis). It pointed out that this sharp increase in prices is primarily because of a significant shift in the technology required to adhere to BS-VI requirements.

The rating agency has stated that as far as manufacturing of EFI system is concerned, as far as things stand, presently domestic manufacturing is limited. EFI system is being imported from prominent suppliers. Consequently, it said at the current levels of localization, cost differential of about 10-15 per cent have emerged in the EFI (BS-VI) Vs carburettor variants of the two-wheeler. However, it said given the scale of the Indian 2W market, auto ancillaries are expected to undertake phased localization of critical parts in the EFI system, which would subsequently bring down the cost of EFI systems as BS-VI gets implemented.

The CNX Nifty is currently trading at 12231.00, up by 50.65 points or 0.42% after trading in a range of 12149.65 and 12246.35. There were 41 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 7.69%, JSW Steel up by 2.19%, NTPC up by 2.03%, Zee Entertainment up by 1.92% and Coal India up by 1.86%. On the flip side, Power Grid down by 2.53%, Bharti Airtel down by 1.29%, Infosys down by 1.12%, Cipla down by 0.57% and TCS down by 0.45% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 40.52 points or 0.15% to 27,949.64, Nikkei 225 surged 31.74 points or 0.13% to 23,827.18 and Straits Times was up by 5.46 points or 0.17% to 3,240.02. On the flip side, Jakarta Composite was down by 3.89 points or 0.06% to 6,245.32.

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Kedia Commodities

Published on 24/01/2020 12:21:48 PM

Japanese exports for December fell 6.3% in December as compared to a year before, data from country’s Ministry of Finance data showed.

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Angel Broking Pvt Ltd

Published on 24/01/2020 11:32:38 AM

Nifty Bank Outlook - (31004)

Yesterday, Bank Nifty started on a flat note and after an initial hiccup bounced back sharply throughout the session to end with gains of around a percent tad above 31000 levels.

In our previous outlook, we had mentioned even though the bank index has broken below the crucial support of 30800; one needs to be watchful as the hourly oscillators were placed in deep oversold territory. In yesterday's session, the bank index managed to hold the previous session low and triggered a smart bounce back to close back above the 89EMA. Going ahead, if the bank index continues to hold 30800 support levels then we may see a bounce back towards 31430 and 31600 levels. On the flip side, strong support below 30800 is placed around the last two sessions low at 30580 With the recent correction, some of the banking stocks are placed at good buying levels with good risk-reward ratio, traders are advised to focus on the same as they are likely to provide outperforming opportunities.

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Angel Broking Pvt Ltd

Published on 24/01/2020 11:32:26 AM

Sensex (41386) / Nifty (12180)

The Nifty opened marginally positive yesterday and traded with a positive bias on the day of the weekly F&O expiry. It ended the session tad below 12200 mark with gains of sixtenths of a percent.

After three sessions of the corrective phase, finally we saw some relief yesterday as the market pulled back higher post opening. The midcap names were back into action as the market breadth improved and thus, the midcap index continued its outperformance over the large cap names. In our previous articles, we have been mentioning to use this decline as a buying opportunity for positional traders and we continue with the same stance. The immediate support for Nifty is now placed around 12100 followed by 12000 mark whereas resistance is seen around 12230 and 12280. Traders are advised to trade with a positive bias and look for opportunities within the midcap space which are providing better returns.

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Kedia Commodities

Published on 24/01/2020 11:29:00 AM

Nifty above 12,200, Sensex gains 170 pts; Adani Gas tanks 13%

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