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Nifty Outlook

Markets edged higher for yet another session and gained over half a percent citing firm global cues. The Nifty index reclaimed 18,000 levels with a gap-up start and inched gradually higher as the day progressed to finally close at 18,070 levels. Most of the sectoral indices traded in line with the index wherein metal, financials and banking were among the top gainers. However, the broader indices ended almost flat due to profit taking.

Nifty has been gradually inching higher with every passing day and a decisive breakout above 18,100 would further fuel the momentum. As we’re seeing rotational buying across sectors, the focus should be more on sector/theme selection and aligning the positions accordingly. Besides the index majors, pick selectively from the broader front too.

News

* Zydus Lifesciences receives final approval from the USFDA for Lenalidomide capsules, used to treat various types of cancers.

* Lupin receives Health Canada approval for Rymti, used to treat rheumatoid arthritis.

* Adani Transmission incorporates wholly owned subsidiary Adani Electricity Jewar for power distribution and infra services.

Derivative Ideas

NIFTY gained 0.75% and closed at 18070.05 on 13th Sep. The index managed to hold its gap up gains and traded with positive bias throughout the day. The move happened on the back of Unwinding in the calls and Put writing at 18000 strike. We expect Nifty to trade with positive bias in the range of 17900-18250 in the short term and thus suggest selling PE as per the given levels.

Strategy:- SELL NIFTY 15 SEP 17800 PE @38-40, STOP LOSS 60, TARGET 5.

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