Pre Market Report, February 11, 2016 | Stocks and Commodities

February 11, 2016
Time: 8.15 am

Pre Market Report:

1. US markets ended mixed after a volatile session.
2. Dow was down mainly due to Disney.
3. Nasdaq was up as technology stocks moved higher.
4. Asian markets barring China, Hong Kong and Taiwan opened and trading lower to adjust last three days of losses in other markets.
5. SGX Nifty is trading below 7200. SGX Nifty hit a low of 7165.
6.  Though results season officially ends on Monday, most of the important companies declare results today.
7. That is why today's market movement is very important.
8. Tomorrow and day after tomorrow, only M&M and Bank of Baroda are the key companies to declare results.
9. Today SBI results will be make or break for the markets.
10. SBI is four times bigger than PNB and PNB came out with Rs 13000 crore bad loans, so what will happen to SBI?
11. Mostly SBI lends along with other banks as syndicate loans, so surely there is a correlation between PNB and other PSU banks to SBI.
12. But SBI has already fallen so much before the results and how much it can fall after the results is a billion dollar question.
13. FIIs keep selling, global cues are very bad, retail money flow to mutual funds is at 20 month low and there is no way markets can move higher except short covering rally here and there.
14. Only LIC can turn the market sentiment now as they did in 2013 August.
15. That time, when Nifty hit 5100, they bought heavily and the sentiment turned after that Nifty has not gone below 5100.
16. Over a period of time, they have booked profit and last year alone they have booked over Rs 10000 crore profit.
17. But LIC should feel that there is value in market, so far that was not the case.
18. Dr Reddy to consider stock buy back, at least one company feels that its share price is under valued.
19. We need to see more companies buying back their shares, insiders buying the shares and LIC entering the markets in a significant way to conclude that the worst is over.
20. On Monday, both China and Hong Kong will open for trading, so markets will be volatile until Monday.
21. The fear is so much, Nifty 6500 Put option is trading around Rs 5.5, the buyers will make money only if Nifty falls 70 points everyday, assuming that buyers are holding the positions until maturity.
22. Even worst, March expiry Nifty 5500 Put option is trading, I do not know who buy these options.
23. So clearly nobody dares to buy the shares, it is now the game of short sellers and short covering.
24. I will not be surprised if markets close in Green due to short covering at the end of the day as most uncertainties will be over by the end of the day.
25. On the contrary, if FIIs selling accelerates, we do not know where Nifty will end today.