Market Mantra: 30/11/2017 (09:00)
SGX-NF: 10315 (-39)
For the Day: updated: 12:45
For 30/11/2017: (Nov-Fut/Spot)
Key support for NF:
10325/10300-10280/10240
Key resistance for NF:
10355-10395/10425
Key support for BNF:
25700-25400
Key resistance for BNF:
26000-26100
Trading Idea (Positional):
Technically, Nifty Fut-Nov (NF/NS) has to sustain over 10375 area for
further rally towards 10425-10475 & 10510/10540 & 10585-10635 zone in
the short term (under bullish case scenario).
On the flip side, sustaining below 10355-10325 area, NF may fall towards 10280/10240-10190
& 10150/10125-10050 zone in the short term (under bear case scenario).
Technically, Bank Nifty-Fut (BNF/BNS) has to sustain over 26000 area for
further rally towards 26100-26325 & 26400-26675 zone in the near term
(under bullish case scenario).
On the flip side, sustaining below 25950-25875 area, BNF may fall towards
25700-25400 & 25200-24950 area in the near term (under bear case scenario).
As par early SGX indication, Nifty Fut (Nov) may open around 10315, gap-down by almost 39 points
tracking muted global/Asian cues and
concern for macro data, Indian version of deleveraging (NPA/NPL resolution) and
GJ elections outcome amid DeMo & GST blues and surging food/vegetable
inflation; Govt/BJP is under immense pressure in GJ election with surging price
of onions (more than 100% jump in the last few months), which has historical
record to change a Govt alone.
Asian market is also under pressure today on techs, insurers & ongoing
China concern; China is again down by around 0.40% today despite an upbeat Mfg
PMI today; it may be waiting for arrival of their “National Plunge Protection
Team” in the last hour of trade to protect the market from further sell off as
in the last few days.
Also, muted prospect of growth in the chip makers (semiconductor
stocks) may have dented the overall tech sentiment, but that perception may be premature.
Japan is up on higher USD despite a terrible IIP data today. AU market is down
on launch of judicial inquiry into country’s financial industry.
Overnight US market closed mixed, but under pressure on huge sell off in techs
(FANG) on perception that the proposed tax reform bill is negative for the big
tech cos (MNC), which may be subjected to repatriation tax on its overseas
profits or even on its current financial assets kept outside US.
DJ-30 climbed by almost 0.44% in another record high boosted by
financials, healthcare, industrials & utilities, while S&P-500 edged
down by almost 0.04% and closed around 2626, but NQ-100 plunged by almost 1.27%
on huge tech sell off & rotational trade, biggest one day correction over
last three months. Apart from Amazon, other retailers were upbeat amid a strong
holiday shopping season; transportation stocks were also getting boost for
holiday season & high consumer confidence in US.
Banks & financials were upbeat on higher USD/US bond yields & hopes for more deregulation (ease of
Volcker rule) and push for affordable US housing by new Fed chief Powell; also
an upbeat US GDP coupled with some hawkish comments by Yellen yesterday (US economy & global expansions are
“increasingly broad based”) and hopes for tax reform bill legislation has
boosted the USD sentiment yesterday. Also an upbeat Fed Beige Book yesterday
has helped the USD bulls.
Also, appointment of Goodfriend, a known policy
hawk as a member of the Fed Reserve Board Of Govs by Trump yesterday may have
supported the USD sentiment.
Overall, US market may be now focusing on new
rotational sectors which may benefit from next economic cycle of US tax
reform/lower tax rates, deregulation & higher interest rates. But US tax
reform squabbling & the ultimate shape of corp tax cut may be a big concern
for the market along with “usual” yearly drama of Govt shut down because of “debt
limit” issues.
US index future (SPX-500) is now trading around
2623, edged down by almost 0.10% on muted Asian cues ahead of EU market
opening.
Crude Oil (WTI) is now trading around 57.45, up by
almost 0.25% on OPEC-NOPEC squabbling and mixed inventory reports. As par
various “trial balloons” ahead of official meeting today, it now seems that
Russia is unwilling to extend any production cuts beyond March’18 for their own
economic interest.
But at the same time OPEC members are desperately
seeking an extension of either 9-12 months, but that may be again reviewed in
June’18; also OPEC may defer its production cut extension agenda today until
Jan’18, when it has more reliable data based on the ground reality of oil
supply & demand dynamics. WTI is already discounted for a 12 months
extension of production cut; thus anything less than that, may cause heavy selling
in oil.
Overnight EU market closed higher in Stoxx-600
(+0.30%) helped by US tax reform optimism and further boosted by banks &
financials (Powell comments about more financial deregulation) & mixed
exporters (EUR edged up on upbeat German CPI & EU economic sentiment);
DAX-30 edged up by 0.10% and closed around 13062, although well off the day
high of 13196; similarly CAC-40 inched up by 0.10%. Automakers also gained on
hopes of M&A.
But FTSE-100 plunged by almost 0.90% on exporters
& MNC (higher GBP on strong buzz of Brexit payments deal); almost 75% of
FTSE earnings come from exporters; it was further dragged by some consumer blue
chips, but helped by banks & financials. Ocado again soared by almost 16%
on top of 21% rally day before that on a tech deal.
EU market is poised for flat opening today with
pressure on FTSE as both GBP & EUR edged up to some extent.
Back to home, Indian
market (Nifty/India-50) is now trading around 10270, sinks by almost 0.85%
and now trading at pre-Moody’s “Historical Upgrade” level on muted Asian cues ahead
of Q2 GDP data. But market may be also concerned about political risk in GJ
election amid DeMo & GST blues and surging food inflation, especially vegetable
prices as general public will not care about rating upgrade/downgrade and macro
economies or even an upbeat GDP.
Today NAMO has also commented that “he is ready
for any political sacrifice for the sake of DeMo & GST”.
Market may be also concerned about ongoing deleveraging
drive by the Indian Govt (like China) or the NPA/NPL resolution mechanism
through IBC/NCLT. As par latest report, Govt may further amend IBC act and
attach/sell assets of personal/corporate guarantors; these are mostly promoters
on whose personal guarantee, banks has extended huge loans even without sufficient
co-lateral securities (like KFA).
Although, these are very important steps to clean
excessive Indian corporate leverage, all these new IBC amendments may be
challenged in law of court and thus the whole process of actual NPA resolution &
credit offtake may be further delayed.
SGX-NF
