Good Morning & Welcome to Wednesday's trading action at Dalal Street, dated 28th August 2019

SGX Nifty in early action is looking wary. Blame it Overnight Wall Street cues where benchmark indices ended in red amidst renewed recession worries from the bond markets.

Oil prices gain—spurred by fresh optimism on the U.S.-China trade negotiations.

7 AM GLOBAL UPDATE:

DOW (-121, 25778)

NASDAQ (-27, 7827)

SGX NIFTY (+16, 11126)

NIKKEI (+32, 20488)

HANG SENG (+103, 25767)

BOVESPA (+847, 97276)

OIL (+0.57, $55.51)

GOLD (+1, $1552)

USD/INR: 71.48

INSTITUTIONS:

FII: - 752.90 Cr

DII: + 1272.29 Cr

SUCCESSFUL INVESTING IS ANTICIPATING THE TRENDS OF:

Global: Neutral.

FII: Negative.

DII: Positive.

F&O: Neutral.

‪Trend:‬ Neutral.‬‬‬‬‬

Sentiment: Neutral.‬‬‬

NIFTY’s CRUCIAL LEVELS:

Nifty’s CURRENT MARKET PRICE: 11,105.

Nifty’s SUPPORT:

Intraday: 10981/10854.

Medium Term: 10637/10201.

Long Term: 8,951.

Nifty’s RESISTANCE:

Intraday: 11189/11201.

Medium Term: 11547/11701.

Long Term: 12,001.

Nifty’s RANGE:

Intraday: 11069-11169.

Medium Term: 10651-11501.

Long Term: 9501-11701.

Nifty’s OUTLOOK:

Intraday: Neutral.

Medium Term: Neutral.

Long Term: Neutral.

IMPORTANT THEMES FOR THE DAY:

It's Wednesday and we suspect a 'Hump Day' at Dalal Street — and hopefully — not a 'Slump Day'.

Now before we get into detail, let's check the key catalysts for the day:

• Optimism is still in the air that the U.S and China could eventually patch up trade-war tensions.

• U.S. Consumer confidence was better than expected.

• There are also renewed signals from the U.S bond markets that a recession could be coming. The yield gap between the U.S. two-year and 10-year Treasury note inverted further on Tuesday as bond investors grew increasingly worried about the economic outlook.

• China revealed a new stimulus plan.

• Maximum Call Open Interest (OI) of 34.86 lakh contracts was seen at the 11,200 strike price. It will act as a crucial resistance level in the August series. Maximum Put Open Interest of 43.32 lakh contracts was seen at 11,000 strike price, which will act as crucial support in August series.

• Expect volatility to be hallmark in next 2 trading sessions as there is the expiry of August futures & options contracts this Thursday.

• As per media reports, cabinet likely to consider relaxing FDI norms in single brand retail, digital media. FDI in India dipped 1% to $44.36 billion in 2018-19

• The Reserve Bank of India on Monday approved a record Rs. 1.76 lakh crore payout to the government, boosting the Centre's coffers at a time when it is under pressure to provide a stimulus to the economy.

That brings to our call of the day which suggests that the only thing to fear is the fear itself.

Well, we say so because Nifty & Sensex have notched remarkable rebound in the last 3-trading sessions, and the good news is that the market breadth continues to improve.

Technically, Nifty’s immediate hurdles at 11,201 mark. Traders are advised to establish aggressive long positions only on any close above Nifty 11,201. Until Nifty clears 11,201 mark brace yourself for choppy water. Perma bulls please note that Nifty may regain 11,501 mark only if there is amicable resolution of U.S-China trade optimism.

Some caution is warranted as FIIs in the month of August have sold shares worth Rs. 14,070 crores. FIIs were net sellers in yesterday’s trading session as they sold shares worth Rs. 923.94 crores.

Expect volatility to be hallmark in next 2 trading sessions as there is the expiry of August futures & options contracts this Thursday.

Outlook for Wednesday: Positive start. Stock specific activity will command attention.

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