Pre Market Report, April 5, 2016 | Stocks and Commodities

April 5, 2016
Time: 8.50 am

Pre Market Report:

1. US markets closed lower.
2. Asian markets are down.
3. SGX Nifty is trading around 7725.
4. This is a gap down of more than 60 points.
5. FIIs bought for Rs 237 crores while DIIs have sold for Rs 334 crores in Cash market.
6. This low level of buying by FIIs and markets are still in over bought zone make the market jittery.
7. RBI policy adds to the uncertainty.
8. But our markets will see some action due to RBI policy.
9. If RBI reduces rates by 25 basis points, then Nifty is likely to fall about 100 points.
10. If RBI reduces rates by 50 basis point, markets will close in Green.
11. But there will be huge volatility before the event.
12. But after the event, VIX is likely to fall, at least by 5%.
13. Even yesterday, volatility fell in Banking stocks, that is why both Bank Nifty 16200 Call and Put fell.
14. I had Bank Nifty 14000 Put and 14500 Put which I squared up yesterday.
15. If Bank Nifty falls more than 200 points intraday before the RBI policy, I will be selling these options again.
16. On the higher side, I have Bank Nifty 17500 Call (sold at Rs 50) and 17700 Call (sold at Rs 35).
17. I expect the Bank Nifty to trade between 14500 and 17500 until the end of this month.
18. Oil Marketing Companies (OMC) will be in focus as petrol prices hiked.
19. Auto stocks may be under pressure for the same reason.
20. IT stocks will be in focus as Rupee is trading very strongly.
21. So be ready for a roller coaster ride.
22. Nifty should take support at 7700 and resistance will be at 7820.
23. But these support and resistances may not work today due to RBI policy.