Pre Market Report, October 18, 2017 | Stocks and Commodities

October 18, 2017
Time: 8.35 am

Pre Market Report:

1. US markets closed at record high once again.
2. Dow crossed 23000 intraday yesterday.
3. After the markets close, IBM shot up by more than 5%.
4. So the Dow futures point to a firm start today also.
5. Asian markets are also mostly positive.
6. But the festive mood is spoiled in India by Axis Bank results.
7. Axis Bank came with a very bad set of results, NPA has gone up significantly.
8. So SGX Nifty is trading below yesterday's low of 10228.
9. That is a very bad sign for very short term bulls.
10. But other than that there is nothing to worry.
11. Bank Nifty will become more volatile due to Axis Bank results.
12. Even some TV channels are saying that Bank Nifty will fall between 200 to 300 points as both ICICI Bank and HDFC Bank fell more than 2% in US.
13. But that may not be the case as HDFC Bank shot up by 5% day before yesterday in US but did not move even 1% here.
14. Since in US, HDFC Bank is trading at a huge premium of more than 10%, there will be no 1 to 1 relation between Indian and US prices.
15. Any dip will be a buying opportunity.
16. If Nifty falls more than 50 points from yesterday's close, I will be selling Put options at 9900 and below.
17. Put options premiums are very good, considering the fact that we have only 4 more full trading sessions.
18. I have large positions in Bank Nifty weekly expiry, once all these positions are closed, I will use the margin money to sell Nifty Put options.
19. Even if Nifty falls 100 point a day, still in next 4 trading sessions, it is going to be 400 point fall. But at 400 point below, 9800PE is also trading at a good price.
20. FIIs have sold for less than 500 crores while DIIs have bought almost double of that.
21. This is the third month, FIIs keep selling.
22. Their selling may subside at some point. That is when we can expect the next leg of rally.
23. Markets may consolidate for few more days.
24. Nifty future should take support at 10180.
25. Resistance will be at 10280.