Pre Market Report, January 27, 2016 | Stocks and Commodities

January 27, 2016
Time: 8.30 am

Pre Market Report:

1. On Monday, though markets opened firmly in Green, markets started falling as there was a news that Crude price started falling.
2. Europe also opened lower on Monday. Also due to holiday on Tuesday, people were not willing to take long positions.
3. So short sellers used to opportunity to short heavily.
4. Bank Nifty futures were trading at 50 points discount to Spot Bank Nifty. That was crazy discount as there are only two more trading sessions.
5. Even Nifty future traded more than more than 10 points discount to Spot Nifty.
6. But there was no market wide fear as India VIX has come down and option premiums also came down.
7. Bank Nifty future was up only 20 points but even 14900 Put option fell more than 20 points.
8. Usually ITM options only will loose value equivalent to underlying change.
9. So Bank Nifty has the potential to shoot up by 50 points just to catch up with spot bank nifty.
10. As the short sellers expected, most markets were down on Tuesday in Asia and US markets were down on Monday.
11. But things have changed on Tuesday afternoon, though Europe opened firmly negative, they have recovered to trade positive.
12. US markets were up and so the crude prices.
13. On Tuesday SGX Nifty hit a low of 7370, which was nearly 1% from Monday's close.
14. Now SGX Nifty is trading at 7435.
15. Today HDFC will declare results.
16. Markets are likely to be volatile as Fed announcement may make some big impact on markets at the opening tomorrow.
17. ICICI Bank and Maruti declaring results, Fed announcement whether dovish or hawkish, and other expiry related issues will make markets more volatile tomorrow.
18. If there is any short covering, then still there will be some hope of Nifty expiring above 7500.
19. Only worry as of now is the high volatile nature of China markets.
20. Yesterday China markets fell about 7% and they were down by another 2% today morning.
21. Crude rose more than 10% on Friday, fell 7% on Monday, rose 3% on Tuesday and today falling again.
22. Stock markets swinging more than 10% and Crude prices swinging more than 20% in a matter of few days are the worrying factors.