Post Market Report, March 3, 2016 | Stocks and Commodities

March 3, 2016
Time: 7 pm

Post Market Report:

1. Spectacular week, on Monday afternoon Nifty was close to 6800 and now it is close to 7500.
2. Even at the peak of bull run in late 2007 also, I did not see this kind of rally.
3. But though Nifty was up by more than 100 points, markets are sensing that the rally is not going to continue.
4. Markets are expected to stabilise.
5. How we can judge this?
6. Look at the option data, today Bank Nifty was up by 85 points but Bank Nifty future was up just by 30 points and all the OTM options and even some ITM options all fell.
7. Though Nifty Call options rose, they did not rise significantly.
8. So markets have reached a stage where markets are likely to stabilise.
9. Our markets did extremely well despite Europe has been trading negative since afternoon.
10. US futures were also almost falt with negative bias.
11. FIIs have bought for Rs 912 crores while DIIs have sold for Rs 465 crores.
12. In the morning I mentioned that other stocks will take the markets higher while Banking stocks take a back seat.
13. That has exactly happened.
14. As I mentioned in the morning, IT, Auto, Pharma and Energy sectors contributed to the rally today.
15. Nifty future is trading at a significant discount to the cash Nifty.
16. That is because people expect many companies to declare more dividends in order to avoid additional tax on dividend income beyond Rs 10 lakhs.
17. Once we are clear about this effect in the next one to two weeks, Nifty future will catch up with cash Nifty.
18. Since we are very close to the resistance level of 7500, it will be interesting to see how markets close tomorrow afternoon.