Pre Market Report, October 6, 2015 | Stocks and Commodities

October 6, 2015
Time: 8.45 am

Pre Market Report:

1. US markets closed significantly higher, DOW is up by more than 300 points.
2. Asian markets are trading firm.
3. SGX Nifty is trading around 8200 after hitting a high of 8225.
4. Glencore, a troubled materials company, shot up by 72% intraday yesterday in Hong Kong, closed at 18% higher in Hong Kong and 21% higher in London.
5. That was reflected here also as materials companies were up yesterday. Tata Steel in particular was up by more than 5%.
6. Yesterday technical supported our markets as 50 day and 100 day moving averages have crossed, gap down 0n 24^th August was taken out, 38.2% retracement of entire fall was also taken out.
7. So Nifty is likely to consolidate around 8200 before taking the next step.
8. Nifty future was around 770 just few days before and today it will be above 8200, so by the end of the day some profit booking is not ruled out.
9. But most important factor is that after August 18, FIIs have bought for about Rs 650 crores in yesterday’s trade, which is a significant amount. 
10. From August 18, there were only two days FIIs were on buy side that too the buy figures were less than 100 crores.
11. As there are no local cues, global cues are playing in the markets. So FII buying and firm overseas markets and short covering by technical traders are helping the markets.
12. So now we have to see how the markets close today, if it closes above 8150 then it is good. We can conclude that markets downside will be limited.
13. One can consider selling 7700 Put option by keeping appropriate stop losses on every dip and Nifty is likely to take support at 7700, as that has been the case in the last few weeks.
14. If Nifty crosses 8200, then one can consider selling 8600 Call option or 8700 Call option as Nifty will face stiff resistance at 8500.
15. Next week will be the beginning of corporate results and markets are likely to move in both directions depending on corporate results.
16. Infosys begins the corporate results season on 12^th October and it is expected to declare good results. That is why Infosys is trading closer to its 52 week high.
17. Today Nifty future is expected to trade between 8100 and 8220.