Pre Market Report, July 19, 2017 | Stocks and Commodities

July 19, 2017
Time: 8.30 am

Pre Market Report:

1. US markets ended mixed due to Goldman Sachs resuts which showed Bond trading income has gone down more than expected.
2. But Asian markets are mostly higher.
3. Even China markets are up after falling for the last few days due to regulatory issues.
4. SGX Nifty is trading higher by about 20 points, trading now at 9870.
5. ITC was the lone stock that dragged the Nifty by 120 points in the last two days.
6. Due to huge gap down, all those who were long in futures lost Rs 1 lakh per lot yesterday.
7. Worst is the case who were long few days before, they have lost Rs 1.25 lakhs in the last two days.
8. This kind of huge loss, people may have to square up other positions to release the money.
9. So the collateral damage was seen in Reliance.
10. Yesterday, if we remove ITC and Reliance, then Nifty would have been higher.
11. Bulls will be happy as Bank Nifty is firm.
12. Even when Nifty was trading uch lower, at one point Bank Nifty was up by more than 150 points.
13. Then came selling in SBI and Bank Nifty fell more than 100 points in the last one hour.
14. People may not dare to short Bank Nifty as from tomorrow to next Thurday, Kotak Bank, HDFC Bank, ICICI Bank, Yes Bank, Axis Bank will declare results, in addition there are some smaller players like Indian Bank, IDFC Bank, will also declare results.
15. Pharma sector was bullish yesterday and that is likely to continue due to US FDA approvals.
16. Everyday India VIX starts lower by 4 to 5% and then shoots up.
17. Let us hope today India VIX falls.
18. Despite Bank Nifty moving significantly higher, Put option premiums are not collapsing.
19. Even 22500 Put option is trading more than Rs 9, it is about 1600 points lower and there are only 6 trading sessions.
20. Even if Bank Nifty falls by 250 points everyday, it is not going to reach 22500.
21. But everyone knows that is not going to happen or at least the probability is next to impossible.
22. I have sold lot of Put options at 23000, 22800 and 22500 and waiting for the the fall in VIX and collapse of premiums.
23. Bank Nifty is likely to lead the rally as speculation in Private sector banks will increase ahead of their results.
24. Reliance will also come into focus ahead of its results tomorrow evening.
25. Nifty future is likely to trade between 9820 and 9920.