Pre Market Report, January 15, 2014 | Stocks and Commodities

January 15, 2014
Time: 8.20 am

Pre Market Report:

1. There was panic in US markets as Copper fell and Retail sales data came very bad.
2. US markets recovered half of the losses in the last hour of trade and that is good for Asian markets.
3. Most Asian markets are flat with positive bias.
4. Crude oil fell, copper fell (India is an importer of these commodities), economic indicator coming from US is getting bad (so Fed may delay rate hike), ECB is going for QE, Japan is going for 29 billion stimulus (so liquidity will be high), India Inflation is very low (rate cut hope is increasing in RBIs Feb. policy). All these go in favour of India.
5. But in short term, markets are bound to be volatile.
6. For no reason, Nifty is falling more than 100 points intraday in the last few days.
7. Crude is up by 5% and hence energy stocks may stabilise (Yesterday only, I mentioned that Crude is likely to stabilise around this level). The fall is Nifty was mainly due to energy and metal stocks, while Banking, IT and Pharma stocks have been doing well.
8. Yesterday I mentioned, by mistake, that Petrol price cut is expected by yesterday night. Petrol and Diesel prices are expected to be cut by tonight.
9. So Auto sector will be good ahead of petrol price cut expectation (bajaj auto result is due today), IT stocks will be good ahead of TCS results, energy sector will be good as crude is up by 5%, banking sector should be good as expectation of rate cut is increasing (Federal Bank result will be out today), pharma and FMCG have been good except for ITC. So there are signs of market bottom for short term.
10. But markets are highly volatile due to intraday traders, that is why Nifty is making such big moves without any significant selling by institutions in the cash market.
11. I feel that most of the negatives are already factored into the markets.
12. So markets may bottom out around this level and may start moving higher.
13. But technical people will confirm the reversal in trend only when Nifty crosses 8400.
14. Breaking news: While writing this blog, RBI cut interest rate and SGX Nifty is trading at 8440.
15. I am leaving the first 13 points as a prrof of what of my analytical skills.