*Market Wrap <https://www.iforex.in/news>*:
*NSE-NF (April):10417 (-5; -0.05%)*
*NSE-BNF (April):25092 (-111; -0.44%)*
*SPX-500: 2642 (-15; -0.55%)*
*Market Mantra: 12/04/2018*
*SGX-NF: 10435 (+18; +0.17%)*
*Expected BNF opening: 25150 (+0.20%)*
*SPX-500: 2646 (+5; +0.20%)*
*(Almost flat opening onhawkish FOMC minutes
mixed global cues as market is waiting for Trump’s decision on Syria
after he taunts Russia to get ready for “nice, new and smart” missiles
coming to Syria as Russia vowed to shoot them down; risk-on trade is off
the table as the market focus shifted from trade war to missile war).*
*March-Fut (Key Technical Levels)*
*Support for NF:***
*Resistance to NF:***
*Support for BNF:***
*Resistance to BNF:***
*Support for SPX-500:*
*Resistance to SPX-500:*
*Technical View (Positional-Nifty, Bank Nifty, SPX-500):*
*Technically, Nifty Fut-March (NF) has to sustain over 10500 for a
further rally towards 10525/10575-10630/10665-10725/10765 in the short
term (under bullish case scenario). ***
*On the flip side, sustaining below 10480-10465 NF may fall towards
10400/10350-10300/10230-10190/10140 in the short term (under bear case
*Technically, Bank Nifty-Fut (BNF) has to sustain over 25325 for a
further rally towards 25450/24650-25775/25850-26150/26300 in the near
term (under bullish case scenario).***
*On the flip side, sustaining below 25275, BNF may fall towards
25150/25050-24950/24800-24600/24400 in the near term (under bear case
*Technically, SPX-500 now has to sustain over 2665 for a further rally
towards 2685/2705-2730/2750-2765/2785 in the near term (under bullish
*On the flip side, sustaining below 2650, SPX-500 may fall towards
2620/2605-2575/2545-2525/2490 in the near term (under bear case scenario).*
*Nifty-50: 10417; Q2FY18 EPS: 410; Q2FY18 PE: 25.41; Avg FWD PE: 20;
Proj FY-18 EPS: 418; Proj Fair Value: 8360*
*Bank Nifty: 25098; Q3FY18 EPS: 820; Q2FY18 PE: 30.61; Avg FWD PE: 20;
Proj FY-18 EPS: 961; Proj Fair Value: 19220*
*Indian and global market
The Indian market (Nifty Fut/India-50)closed around 10417 on Wednesday,
almost flat (-0.05%) on subdued global cues amid concern of Syrian
geopolitical tensions, higher oil.
*RBI may not oblige for relief on CDR/NPA provisions:*
There was also report that RBI may not oblige with the IBA request to
scrap/modify its 12^th Feb circular regarding scrapping of various loan
restructuring schemes under CDR (corporate debt restructuring). Thus the
new NPA norms may hit the bank’s earnings significantly in Q4 and
banking stocks dragged the market along with higher bond yields, all
negative for their earnings.
*ICICI saga continues:*
Apart from surging oil, another report that a banking consortium,
leading by the ICICI Bank has given loan for Rs.5.280 billion loans to
the Mehul Choksi’s Gitanjali group has also affected the overall banking
sentiment and the market. In addition, there was another report of 24
years business relationship with the ICICI Bank’s CEO family with the
Videocon group, under the allegation of nepotism and favoritism. ICICI
Bank is also under pressure from an influential political and investor
activist Kirti Somaiya on overall issues of corporate governance.
A higher oil (Crude) hovering above $65 and eyeing the $80 level as par
Saudi jawboning and ongoing geopolitical tensions in the middle east
(Syria) is not only bad for the Indian economy and the market, but is
also bad for the health of the oil marketing companies (OMC), especially
in the election year as the government is not allowing them to raise
prices and they have to absorb around Rs.1 per liter of petrol and
diesel ahead of the Karnataka state election.
Subsequently, OMCs were in pressure, dragging the whole market along
with Banks and Nifty-I made an opening session low of 10363 and mid-day
high of 10440 in a day of moderate volatility ahead of some key Q4
earnings report and macro data (CPI/IIP) on Thursday.
As India almost imports 80% of its crude oil requirement, the country
and the economy is vulnerable to any sustainable oil price shock. Also,
a very high tax component of over 75% on petrol and diesel may be a
dilemma for fiscal deficit, revenue collection and overall inflation in
the economy. India is a very reliable acid test since the economy and
expensive oil don't mix. The oil minister has already chimed in and said
prices are too high and urged for inclusion in the GST, with hopes of a
reasonable taxes, but the government declined.
The ADB also flagged higher oil as a risk to watch for India. As par
reports, the government has also asked the oil retailers (OMC) to not to
increase prices and consequently, shares of OMC with downstream presence
plunged on Wednesday, as with sovereign bonds with yields backing up
significantly to almost 7.55% on higher oil after falling to around
7.12% on some policy measures from RBI and the government.
When Brent pushed through $60 late last year, there was widespread
concern that prices at or above the $65 to $70 range will start to hurt
the Indian economy, all being equal and the government also promised at
that time to reduce the additional excise duty imposed on it for an easy
revenue to fund its capex. But the government is now on the back foot
and will not cut any tax component on oil as overall revenue is subdued
on lack of full GST compliances and other issues as the economy is still
suffering from lingering DeMo and GST shocks.
Indian GST, in its present format, is perhaps the most complex and
costly in the world right now. Abnormal high compliance costs are making
MSME or small informal business models unviable to do the business
itself and consequently, there is a risk of mass unemployment in the
All of the above is an indication that oil at these levels represents a
turning point for India and extreme cases like India are already in hot
soup. Any incremental move higher in prices, Indian rating may be
On Wednesday, Nifty was helped by RIL (launch of fixed line broadband by
R-Jio), TCS (earnings optimism ahead of result), VEDL (surge in aluminum
prices, thanks to Trump’s sanction on one major Russian producer), Infy
(earnings optimism), Kotak Bank, Sun Pharma, HUL, M&M, HCL Tech, Eicher
motors and others by around 65 points, while it was dragged by IOL,
BPCL, HPCL (government instruction to absorb higher crude oil prices),
ICICI Bank, Axis Bank (leadership crisis), SBI (RBI denial to scrap CDR
relief), ITC, Yes Bank, HDFC, Adani Ports and others by 55 points
Overall on Wednesday, Indian market was helped by mixed FMCG, techs
(higher USD and earnings optimism), media, metals, pharma (higher USD
and US FDA optimism), consumption, MNC (higher USD), while dragged by
banks and financials (higher bond yields) reality, energies/OMC.
*Global cues were subdued during Indian market hours on Wednesday:*
US stock future (SPX-500) was down by 0.94% and European stocks were
down by 0.43% on concern about US military escalation in Syria.
President Trump spoke with UK Prime Minister May and French President
Macron and canceled a planned trip to South America as he intensifies
preparations for a US response to an alleged chemical weapons attack by
the Syrian government on its own people. Russia warned that any US
missiles fired at Syria over a suspected chemicals weapons attack will
be shot down and the launch sites targeted, raising the possibility of a
direct US-Russian confrontation.
Also, Eurocontrol, an air traffic agency in Europe, asked airlines to
apply caution on flights to the eastern Mediterranean region because of
possible air strikes in Syria over the next 72 hours. Asian stocks
closed mixed: Japan -0.49%, Hong Kong +0.55%, China +0.56%, Taiwan
+0.43%, Australia -0.48%, Singapore +0.39%, South Korea -0.32%, India
Asian equity markets traded mixed as sentiment settled down from
thebullishness seen from President Xi’s and Trump & Co’s conciliatory
tone on Tuesday
resulted to a solid performance on Wall St, while attention turned to
the geopolitical climate with a possible announcement on Syria said to
Earlier, trade in Asia was mixed with indexes in China and Hong Kong
posting the biggest gains in that region as PBOC Governor offered more
details on pledges to open the world’s second-biggest economy, and vowed
China would not devalue the Yuan in response to a trade war.
Australia's ASX 200 failed to sustain mild opening gains as softer
Australian consumer sentiment data and weaker than expected Chinese
inflation figures clouded the upside seen in commodity-related sectors.
Nikkei 225 was also lackluster with J Front the worst off amongst the
retailers on expectations of weaker profits this year, while SoftBank
outperformed on M&A hopes after reports its unit Sprint and T-Mobile
renewed merger talks.
Hang Seng and Shanghai were initially choppy as markets digested the
miss on Chinese CPI and PPI data, although stocks gradually found some
comfort from efforts by PBOC Governor to build upon the momentum from
President Xi at the Boao forum in which the PBOC Governor talked about
opening up and announced to increase stock connect quotas.
In Europe, equities began the day trading slightly lower with the
risk-on sentiment seen in yesterday’s trade not being echoed early on.
This comes to fruition despite the revelations from Chinese president Xi
mentioning a preference to implement auto tariff cuts as soon as
possible (this relating to a possible reduction on import taxes on autos
by half from 25% currently).
Market sentiment was largely being guided by increased tensions in Syria
amid potentially imminent military action by the US. This follows on
from overnight news of increased air traffic over Syrian airspace and
condemnation from the international community. EU equity sector
performance has largely been driven by company-specific news with M&A
activities in the telecom sector.
Kindly email stock reports at
For sharing knowledge
-- NIFTYVIEWS.COM NOW A FREE OPEN SOURCE WEBSITE.
"The opinions expressed by the members on this board are based on
their individual experience and perceptions and to share information
with other members with the best of intentions to help fellow members
in investment decisions as equity investment is a risky venture.The administrator of
www.Niftyviews.com just provide a platform for the authors to express their opinion
and take no guarantee for the genuineness of the same."ANY member of this forum
doesnt prepare or publish any research report; or ii. provide research report; or
iii. make 'buy/sell/hold' recommendation; or iv. give price target;
You received this message because you are subscribed to the Google Groups "Niftyviews.com" group.
To unsubscribe from this group and stop receiving emails from it, send an email
For more options, visit https://groups.google.com/d/optout.