9 AM UPDATE:
DOW FUTURES (+14, 27155)
NASDAQ FUTURES (-04, 7839)
SGX NIFTY (-31, 11399)
NIKKEI (-60, 21407)
HANG SENG (-227, 28538)
SHANGHAI (+23, 2924)
The key themes of the day
• Finance Minister Nirmala Sitharaman staying firm on tax for FPIs. Digging deeper, from the Union Budget day i:e from 5 July till date, Sensex has been down nearly 4%, while BSE Midcap and BSE Smallcap were down 5-7%.
• FIIs were net sellers in last week’s trading sessions to the tune of Rs. 3,033.41 crores. FIIs were net sellers in all the five trading sessions. Foreign portfolio investors have pulled out Rs 6,475.55 crore in the month of July till date, the highest outflow markets have seen in 2019.
• Downward revision in India's growth to 7% by ADB. India's June exports which fell 9.7% to $25 billion.
• Monsoon: Weighing on pessimism is deficit in cumulative rainfall which till July 17 was 15.8% below normal levels and the weekly rainfall 19.8% below normal.
• Geo-political tension between the US and Iran. As per reports, the U.S. shot down an Iranian drone it said was threatening a warship in the Strait of Hormuz.
• Elusive Trade Deal: Lack of progress in the Beijing-Washington tariff dispute — which remains a headache. Comments from President Donald Trump on the lack of progress between Beijing and Washington in the long-running dispute over trade and import tariffs. President Donald Trump said an agreement with China on trade tariffs had “a long way to go,” and most importantly said he could impose the full slate of tariffs on Chinese imports.
• Disappointing Q1 from RBL Bank as its stock price plunged 21.92% amidst risks to its asset quality. Yes Bank too reported a weak quarter, down 11.62% on weekly basis sparking a sell-off in the entire sector.
• Slowing consumption: Ashok Leyland temporarily shuts Pantnagar plant for nine days over weak demand.
• DHFL stock price plunges 21.82% on weekly basis. No F&O contracts to be made available for trading in equity segment from September 27 onwards. Reliance Q1 results that trickled in on Friday after market hours where traditional business felt the heat as its gross refining margin (GRM) at $8.1 per barrel was a miss on street expectations.
STOCKS TO WATCH:
BULLISH STOCKS: APOLLO HOSPITALS, MCX, ULTRATECH, NESTLE.
BEARISH STOCKS: APOLLO TYRES, MOTHERSON SUMI, EICHER MOTORS, PAGE INDUSTRIES, CANARA BANK, IDBI, IDEA, IDFC, INDUSIND BANK, LIC HOUSING FINANCE. MUTHOOTH FINANCE, RELIANCE INDUSTRIES, PNB, VEDANTA.
All about stocks (F&O Trades):
• JUBILANT FOODS (CMP 1215): Sell between 1121-1125 zone. Targets 1186/1171. Stop 1257.
• HINDUSTAN UNILEVER (CMP 1720): Sell at CMP. Targets 1702/1161. Stop 1769.
• UNION BANK OF INDIA (CMP 73.90): Sell at CMP. Targets 69/63. Stop 79.05.
All about stocks (Medium-term Sell Trades):
• ASHOK LEYLAND (CMP 79.35): Sell at CMP. Targets 71/63. Stop 92.81.
PAGE INDUSTRIES (CMP 19864): Sell at CMP Targets 18001/17321. Stop 20512.
• VEDL (CMP 161.75): Sell at CMP. Targets 145/139. Stop 173.45.
SHOW ME THE MONEY:
Option Trade: BUY NIFTY 25th July PE Strike Price 11300 at CMP 29.05. Profit: Unlimited. Maximum Loss: Rs. 2,178.75. Stop: Exit Put option if Nifty moves above 11575. (Nifty July Futures CMP 11421.85).
Bulls Vs. Bears: Time to Pick a Side!!
Bear market calls are rampant these days.
Preferred trade on Nifty (11419): Sell at CMP. Targets at 11301/11271/11101. Stop 11707.
Preferred trade on Bank Nifty (29770): Sell between 29901-30000 zone. Targets at 29501/28847. Stop 30475.