9 AM UPDATE:
SGX Nifty hits 12000 mark before market opening. But having said that, volatility could be the hallmark of today’s trade amidst the Union Budget
DOW FUTURES (+08, 26979)
NASDAQ FUTURES (+05, 7877)
SGX NIFTY (+20, 12000)
NIKKEI (-11, 21692)
HANG SENG (+62, 28858)
SHANGHAI (0, 3006)
The key themes of the day
• The Gross Domestic Product (GDP) in the January – March quarter was at dismal 5.8%, sharply down from 6.6% in the previous quarter, and most importantly, well below forecasts and the slowest in over four years..
• ,The street will hope that the Union Budget will seek to address some of the challenges confronting the economy, especially the rural distress and the need for generating quality jobs.
STOCKS TO WATCH:
• BULLISH STOCKS: HINDUSTAN UNILEVER, BANK OF INDIA, CANARA BANK, RELIANCE INDUSTRIES, ADANI ENTERPRISES, DLF, AIA ENGINEERING, GRSE, RITIES, PETRONET, INDUSIND BANK, REC, PFC, VOLTAS, BAJAJ FINSERV, BAJAJ FINANCE, ICICI BANK, SBIN.
• BEARISH STOCKS: DR REDDYS LAB, VEDANTA, BPCL, HCLTECH.
All about stocks (F&O Trades):
• REC (CMP 167.50): Buy between 157-161 zone. Targets 172.50/181. Stop 155.
• BANKOFINDIA (CMP 94.50): Buy between 87-90 zone. Targets 97.50/102.50. Stop 85.
• HINDUSTAN UNILEVER (CMP 1794): Buy at CMP. Targets 1821/1865. Stop 1741.
All about stocks (Cash Trades):
• KENNAMETAL (CMP 1116): Buy at CMP. Targets 1275/1501. Stop 991.
• RATNAMANI METALS (CMP 1000): Buy at CMP. Targets 1125/1501. Stop 821.
• GRSE (CMP 123): Buy at CMP. Targets 151/175. Stop 105.
SHOW ME THE MONEY:
Option Trade: BUY NIFTY 25th July CE Strike Price 12000 at CMP 138.55. Profit: Unlimited. Maximum Loss: Rs. 10,391.25. Stop: Exit Call option if Nifty moves below 11737. (Nifty July Futures CMP 11979.60).
Bulls Vs. Bears: Time to Pick a Side!!
Positive start. Confirmation of strength only if Nifty moves above 11939 mark.
• Preferred trade on Nifty (11947): Buy between 11825-11851 zone. Targets at 12105/12251. Stop 11721.
• Preferred trade on Bank Nifty (31472): Buy between 31000-31101 zone. Targets at 31751/32251. Stop 30561.
8 AM UPDATE:
• Nifty July Futures ended Thursday's session at a premium of +32 vs premium of +32.
• The 11th July expiry Put-Call Open Interest Ratio was at 0.97 for Nifty whereas it was 0.44 for Bank Nifty.
• The 11th July expiry Put-Call Volume Ratio was at 1.05 for the Nifty and 0.67 for Bank Nifty.
• For Nifty, Maximum Call Open Interest (OI) stands at 12000 Strike Price, followed by 12200 Strike Price for 11th July Series. Long buildup was seen at strikes price 11700-12100.
• Maximum Put Open Interest (OI) was seen at strike price 11800 followed by 11900 strike price for 11th July series. Short Buildup was seen at strike prices 11400-12000.
• For Bank Nifty, Maximum Call Open Interest (OI) stands at 32000 Strike Price and Maximum Put Open Interest stands at 31000 Strike Price.
• As per Thursday’s Provisional Data available on the NSE, FII’s sold shares worth Rs. 28.95 crores in the Indian Equity Market. DIIs on the other hand, bought shares worth Rs. 58.59 crores in the Indian Equity market.
• Long Buildup: BANKINDIA, UPL, PETRONET, RBLBANK, KOTAKBANK.
• Short Buildup: YESBANK, HCLTECH, PEL, DABUR.
• Short Covering: JUBLFOOD, AMARABAT, KAJARIA, MARUTI..
• Long Unwinding: JUSTDIAL, TATASTEEL, HEXAWARE, DIVISLAB.
• Stocks banned in F&O segment: DHFL, RELCAP.
7 AM GLOBAL UPDATE:
SGX Nifty holding the line ahead of presentation of Union Budget. Amongst emerging markets, Brazil' Bovespa zooms.
DOW (CLOSED, 26966)
NASDAQ (CLOSED, 8170)
SGX NIFTY (+1, 11981)
NIKKEI (+19, 21721)
HANG SENG (-10, 28785)
BOVESPA (+1593, 103636)
OIL (-0.60, $56.74)
GOLD (-1, $1420)
SUCCESSFUL INVESTING IS ANTICIPATING THE TRENDS OF:
NIFTY’s CRUCIAL LEVELS:
Nifty’s CURRENT MARKET PRICE: 11,947.
Medium Term: 11,487/11351.
Long Term: 10,901.
Medium Term: 12107/12251.
Long Term: 12,501.
Medium Term: 11487-12201.
Long Term: 10901-13001.
Intraday: Positive session likely.
Medium Term: Neutral.
Long Term: Positive.
Our call of the day suggests Acche din to continue if the Union Budget revives growth & yet maintains fiscal prudence.
Our chart of the day suggests establishing buy position in stocks like HINDUSTAN UNILEVER, REC & NESTLE with interweek perspective.
Perma bulls with 1 year+ perspective should look into stocks like JSW Steel, Ratnamani Metals & Tubes and KALYANI Steel (KSL)
IMPORTANT THEMES FOR THE DAY:
Today, all anxious eyes will be on the most powerful and the most important minister in Narendra Modi’s cabinet - Finance minister Nirmala Sitharaman.
This will be Finance Minister Finance minister Nirmala Sitharaman's first budget and the same will presented at 11 am.
This Union Budget holds significance as are after the 2019 general elections and the street will spy with one big eye if are in line with BJP party's manifesto, released before the Lok Sabha elections.
Digging deeper, the BJP's economic model is based on entrepreneurship and innovation, the party is also committed to simplifying and lowering tax rates.
We suspect, expectations of benefits being doled out in the Union Budget are very high, way higher than those in interim budget. Hence, the Union Budget has to be a game changer and should definitely represent the reforms that the BJP government had promised to make. The budget is unlikely to be populist as the main challenge before the Government is to support a growth recovery via fiscal consolidation.
Please note, the gross domestic product (GDP) in the January – March quarter was at dismal 5.8%, sharply down from 6.6% in the previous quarter, and most importantly, well below forecasts and the slowest in over four years.
Honestly speaking, to rejuvenate growth, the tricks of monetary easing could be played, but strictly not at the cost of higher fiscal borrowing. The street will spy with one big eye if the government sticks to fiscal deficit estimate at 3.5% of GDP (3.4 per cent of GDP as per the interim budget).
The street will hope that the Union Budget will seek to address some of the challenges confronting the economy, especially the rural distress and the need for generating quality jobs.
Final Thoughts: The countdown begins and this time investors would love to have the results. The bulls’ camp will look for triggers that can telegraph optimism and help lift Nifty to move towards 12105 mark.
Well, this 12105 on Nifty could be a reality if (Securities transaction tax) STT is removed. Well, if the government abolishes STT then Nifty could just keep on moving one way up!
Outlook for Friday: Nifty will aim to reclaim its all-time-high at 12,103 mark.