Pre Market Report, March 5, 2015 | Stocks and Commodities

March 5, 2015
Time: 8.40 am

Pre Market Report:

1. US markets closed negative.
2. Most Asian markets are down.
3. China lowered its economic growth to 7% making India as fastest growing big economy in the world.
4. This is sentimentally positive for medium to long term.
5. SGX Nifty is almost flat with positive bias.
6. Every one amazed by yesterday's market move. There was no selling by FIIs in F&O market. There was huge buying in cash market. There was no negative clue. Even Services PMI came at 7 month high. Still Bank Nifty fell 1000 points and Nifty fell 300 points from their intraday highs.
7. But clearly this did not create panic. This is evident from the fact that despite such a huge fall, VIX has come down, Call option open interest has not increased, Put option open interest has not decreased.
8. So option sellers attribute the sell off as purely profit booking and the fall will be arrested at this level and markets may go for consolidation from here.
9. Consolidation phase is good for option sellers. For example, if anyone has sold 8700 put and 9300 call (300 points on both sides), one would have made a profit of Rs 10 per share, Rs 2500 per lot despite such a big fall. This profit will only increase when markets consolidate between 8800 and 9200.
10. SBI is coming out with 15000 crore will keep SBI share price under pressure.
11. So along with it, entire PSU Banks will be under pressure.
12. Spectrum auction fetching good amount of money, likely to be more than 1 lakh crore, is good for macro economy.
13. So in my opinion, markets may consolidate for few more weeks and then again will break out.
14. The target of 9200 remains the same in next 6 to 8 weeks.
15. Today Nifty future may trade between 8920 and 9020.