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

June 27, 2016
Time: 8 am

Pre Market Report:

1. I did not write "Dalal Street Week Ahead" as Brexit will be the only issue that will be dominating the markets.
2. Except US GDP data on Tuesday, there are no important news flow this week.
3. On Friday all Europe related stocks fell more than 5%.
4. There were lot of surprises on Friday.
5. First, FII selling of little over Rs 600 crores in Cash market was not that bad, even on normal days they sell for such figures.
6. The most disappointing factor was that of DIIs buy figure.
7. They just bought for little over Rs 100 crores, DIIs were expected to buy more when the markets are in such a panic mode.
8. People will interpret this as 'the market has more downside'.
9. That is one of the main factors why SGX Nifty fell on Friday evening.
10. Even now SGX Nifty is trading around 8020 which is much lower and huge under performance to Asian markets.
11. In Fact, China, Japan, Australia are trading in Green.
12. Other Asian markets have recovered from their lows.
13. But SGX Nifty is still hovering around 8020.
14. Dow futures are down by half a percent.
15. UK and German future are down by 1 to 2%.
16. Sterling pound is losing more value.
17. Crude prices are falling.
18. So the volatility will continue in our markets due to expiry related issues.
19. But the most interesting thing on Friday's trade is that Retail investors bought shares more than what DIIs have bought.
20. Monsoon has been progressing well over the week end.
21. GST bill is likely to be passed in July.
22. Seventh Pay Commission payout is likely to be in August.
23. So now we have a situation where we have all good local cues and bad global cues.
24. UK finance minister is likely to make a statement at 11.30 am today.
25. Markets sentiment may improve after that.
26. Nifty future will find strong support at 7920.
27. Markets may not fall much from here because of the following reasons:
28. (a) There is no huge short selling in F&O, there was only long unwinding.
29. (b) Most portfolio investors have hedged their folio before the Brexit and hence there will be no panic selling.
30. (c) Central Banks may act in case of further panic.
31. (d) We have lot og good news ahead like very good monsoon, GST, seventh pay commission, etc.
32. I expect Nifty to trade between 7800 and 8200 until expiry with huge volatility.