Dalal Street Week Ahead | Stocks and Commodities

September 28, 2014
Time: 8.30 am

Dalal Street Week Ahead:

1. Last week 4 bad things have happened, two locally and two globally.
2. First, Coal blocks allotment cancellation by supreme court, it was a big blow for PSU Banks as they have a loan portfolio of around Rs 1 Lakh crore to the coal related companies. Also JSPL and Hindalco as earlier it was assumed that some blocks will be exempted.
3. Second, deferment of Gas price hike for second tome. This affected the energy stocks. 
4. Third, iphone 6 plus bending issue. There were reports that iphone 6 plus is bending, if pressure is applied or accidentally sit on it, this brought iphone shares by 4% and that dragged the overall markets in US.
5. Last one, the news that Russia was planning to bring in a law that allows Russian courts to seize foreign assets as a retaliatory measure for Sanctions against Russia by Western countries.
6. So Nifty corrected from a high of about 8200 to about 7850.
7. This is 50% retracement of last big up move from 7500 to 8200.
8. Also 7850 is where 50 day moving average is positioned.
9. So this double technical support provided some relief to the bulls.
10. On Friday, S&P upgraded India's credit rating, so markets bounced back.
11. Still Nifty spot is well below 8000.
12. But Nifty future is way above 8000.
13. The premium of Nifty future is as high as 70 points, usually it will be 30 to 40 points.
14. Next week will be a truncated week. Thursday and Friday being holiday.
15. On Monday, there are no market moving news locally.
16. But markets will react to the news over the weekend. S&P upgraded the ratings of 11 banks and 5 companies, including index heavy weight Reliance.
17. Also US markets closed positive after a big sell off on Thursday will have positive impact here on Monday.
18. So on Monday markets will be slightly positive.
19. But continued FII selling is a cause for worry.
20. On Tuesday, RBI policy will be the main driver of market movement.
21. Banking stocks are likely to be volatile, we have already the the huge volatility of Bank Nifty on Friday, Bank Nifty was down by 150 points, then shot up by 300 points, again fell 350 points, again shot up by 400 points, etc.
22. Also after the markets close, Core sector growth and fiscal deficit data are due from India. 
23. On Wednesday, there are lot of news flow. Manufacturing PMI data from China, India, German and US. Both China and German data will watched closely as they made big movements in markets last week. Also ADP Nonfarm Employment Change data is due from US which is a very important data.
24. Also Chinese and Hong Kong markets are closed on Wednesday.
25. On Thursday, our markets are closed. Also HK markets.   
26. On Friday also our markets are closed. Nonfarm Payroll data and Unemployment change data are due from US.
27. Once again Nifty is likely to trade between 7800 and 8200 next week.