Know What Matters at Dalal Street at 7 AM!!
In early action, SGX Nifty is seen zooming as helping sentiments are strong positive cues at Wall Street in Friday's trade.
Dow Jones ended 263 points higher on hopes of rate cut by the US Federal Reserve on backdrop of a weaker-than-expected jobs report.
7 AM GLOBAL UPDATE:
DOW (+263, 25983)
NASDAQ (+127, 7742)
SGX NIFTY (+53, 11951)
NIKKEI (+215, 21099)
HANG SENG (+241, 27207)
BOVESPA (+616, 97821)
OIL (+0.20, $54)
GOLD (-10, $1336)
SUCCESSFUL INVESTING IS ANTICIPATING THE TRENDS OF:
NIFTY’s CRUCIAL LEVELS:
Nifty’s CURRENT MARKET PRICE: 11,871.
Medium Term: 11,601/11351.
Long Term: 10,901.
Medium Term: 12501.
Long Term: 13,001.
Medium Term: 11,501-12,501.
Long Term: 10,901-13,001.
Medium Term: Neutral.
Long Term: Positive.
Our call of the day suggests Nifty will aim to reclaim psychological 12,000 mark. Technically, Nifty's make-or-break support at 11727. Intraday support seen at 11829.
Our chart of the day suggests establishing long positions in stocks like UPL, TITAN and ICICI BANK with inter-week perspective.
IMPORTANT THEMES FOR THE DAY:
If last week's trading action at Dalal Street is any indication then on the surface, all seems well, but beneath things look bit turbulent.
That brings us to the key themes which are likely to command investors attention:
1. After a week’s delay, India’s monsoon officially arrived South Kerala’s coast on Saturday. Monsoons are the lifeblood of India’s $2.5 trillion economy and accounts for 70% of the country’s rainfall.
2. Sentiments will continue to be dented by DHFL's ₹850 crore commercial paper rating that has been downgraded by CRISIL to default.
3. The street is still was unhappy with the policy lacking any definitive relief measures for non-banking financial companies (NBFCs). There are widespread apprehensions that a collapse or bankruptcy in any one large NBFC can lead to systemic contagion due to the financial sector’s vicious circle.
Please note at this moment, NBFC's are battling liquidity and debt repayment pressures, primarily due to a skewed asset-liability profile. Investors will spy with one big eye if the crisis would push up financing costs and made it harder for NBFCs to access the bond market
4. The red flags of recessionary warnings are flagging in all directions. India's economic growth too has slowed sharply to a five-year low of 5.8% in the three months to 31 March.
5. Fanning negative flames are also the Friday's provisional data where FII’s sold shares worth Rs. 479 crores.
6. Fears that the U.S. economy is decelerating as trade tensions between the U.S. and counterparts Mexico and China persist.
The street will anxiously spy with one big eye on the newly elected Narendra Modi government on how they spur the sluggish Indian economy to grow at a much faster pace. Investors are concerned over growth as challenges regarding liquidity continue to linger.
So, commanding attention would be the CPI numbers and IIP numbers — rolling out on 12th June 2019. Trade Balance & WPI Data expected on 14th June 2019.
Bottom-line: The gyan mantra for the day is to remain highly selective.
Outlook for Monday: Nifty will aim to reclaim 12000 mark.
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Calculus Derivatives Corner at 8 AM
• Nifty June Futures ended Friday's session at a premium of +17 vs premium of +40.
• The 13th June expiry Put- Call Open Interest Ratio was at 0.67 for Nifty whereas it was 0.77 for Bank Nifty.
• The 13th June expiry Put-Call Volume Ratio was at 0.84 for the Nifty and 0.86 for Bank Nifty.
• For Nifty, Maximum Call Open Interest (OI) stands at 12000 Strike Price, followed by 12100 Strike Price for 13th June Series. Short buildup was seen at strikes price 11800-12100.
• Maximum Put Open Interest (OI) was seen at strike price 11800 followed by 11700 strike price for 13th June series. Long buildup was seen at strike prices 11400-11900.
• For Bank Nifty, Maximum Call Open Interest (OI) stands at 32000 Strike Price and Maximum Put Open Interest stands at 30500 Strike Price.
• As per Friday’s Provisional Data available on the NSE, FII’s sold shares worth Rs. 478.84 crores in the Indian Equity Market. DIIs on the other hand, bought shares worth Rs. 179.79 crores in the Indian Equity market.
• Long Buildup: BAJFINANCE, DCB BANK, HDFC BANK, PFC, SBIN.
• Short Buildup: POWERGRID, RELCAP, BIOCON, RELINFRA.
• Short Covering: HINDPETRO, ICICI BANK, FEDERAL BANK, ESCORTS.
• Long Unwinding: MCDOWELL, IGL, HUL, MANAPPURAM.
• Stocks banned in F&O segment for today: DHFL, IDBI, PC JEWELLER.
What Caught our eye at 9 AM?
Positive session on cards. Bulls will aim to hit 12000 mark.
9 AM UPDATE:
DOW FUTURES (+78, 26069)
NASDAQ FUTURES (+25, 7441)
SGX NIFTY (+63, 11960)
NIKKEI (+245, 21130)
HANG SENG (+555, 27521)
SHANGHAI (+19, 2847)
The key themes of the day:
• Dow Futures is trading 78 points up at 26069 on hopes of rate cut by the US Federal Reserve on backdrop of a weaker-than-expected jobs report.
• All anxious eyes from here on will be on the June 18-19 Federal Reserve meeting where the street is placing a 25.8% chance of a rate cut.
STOCKS TO WATCH:
• BULLISH STOCKS: DEEPAK NITRITE, AIA ENGINEERING, NAUKRI, HUL, BAJAJ HOLDINGS, AMRUTANJAN, RITES, GUJRAT FLUROCARBON.
• BEARISH STOCKS: DR REDDYS LAB, RELIANCE CAPITAL, RELIANCE INFRA, TATA MOTORS, MARUTI, PNB, JSW STEEL, INFRATEL, HINDALCO, VEDANTA.
All about stocks (F&O Trades):
• UPL (CMP 1019): Buy between 1005-1013 zone. Targets 1045/1101. Stop 987.
• ICICI BANK (CMP 417): Buy at CMP. Targets 431/445. Stop 405.
• DR REDDY’S LAB (CMP 2581): Sell between 2597-2611 zone. Targets 2423/2289. Stop 2711.
All about stocks (Cash Trades):
• TITAN (CMP 1269): Buy between 1257-1263 zone. Targets 1281/1311. Stop 1227.
• AIA ENGINEERING (CMP 1827): Buy at CMP. Targets 2001/2150. Stop 1491.
• RITES (CMP 282): Buy at CMP. Targets 300/327. Stop 239.
SHOW ME THE MONEY:
• Option Trade: BUY NIFTY 13th JUNE CE Strike Price 12000 at CMP 22. Profit: Unlimited. Maximum Loss: Rs. 1,650/-. Stop: Exit Call option if Nifty moves below 11801. (Nifty June Futures CMP 11887.90).
Bulls Vs. Bears: Time to Pick a Side!!
Buy on dips should be the preferred strategy.
• Preferred trade on Nifty (11871): Buy between 11821-11851 zone.Targets12001/12151-12251 zone. Stop 11721.
• Preferred trade on Bank Nifty (30857): Buy between 30901-31001 zone. Targets 31501/31751. Stop 30411.
Where's the Clever Money going at 3 PM?
Nifty (+37, 11907): Indices are trading in a range with some gains. Shares of state-run oil marketing companies fell after crude oil prices rose in the international commodity market.
Foreign markets continued to be positive.European markets opened on a strong note, after the US and Mexico reached a deal to avoid the implementation of tariffs.
Shares of Jammu & Kashmir (J&K) Bank tanked 20 per cent to Rs 47.60 apiece on the BSE after reports suggested that the Anti-Corruption Bureau alleged Parvez Ahmed, now-removed chairman-cum-managing director, of indulging in corrupt activities
Selling seen in the auto, bank, energy and metal, while some buying seen in the FMCG, infra, IT and pharma.
The Indian rupee is trading lower at 69.66 per dollar against Friday's close 69.47.
Probable BTST/STBT trades:
Bullish looking BTST trades: BRITANNIA, TECHM, TCS, INFRATEL.
Negative looking STBT trades: BPCL, TATA MOTORS, YES BANK.