Pre Market Report, January 4, 2018 | Stocks and Commodities

January 4, 2018
Time: 8.30 am

Pre Market Report:

1. US markets closed at another record high.
2. Most Asian markets are trading with positive bias.
3. SGX Nifty hit a high of 10520 yesterday night.
4. Now SGX Nifty is trading around 10500.
5. FII and DII both were net buyers in Cash market.
6. But there is huge shorting by FIIs in F&O.
7. Despite all positive news, Nifty fell nearly 90 points from intraday high for the last two days.
8. Crude prices are moving still higher.
9. That is a bad news from Auto stocks. Maruti has already corrected more than 5% from the peak.
10. India's under performance may be due to this Crude prices only.
11. Nifty has been in the range of 10000 to 10500 for more than 5 months and trading closer to the upper band.
12. Any breakout will be powerful, Nifty may hit 11,000.
13. But we need a trigger, I expected Gujarat election as trigger.
14. But that did not happen as BJP won with very little margin.
15. Now the trigger can come either from Corporate results or Budget.
16. The fear of Long Term Capital Gains tax in budget, higher Fiscal Deficit, Higher Crude prices, Bearish about Corporate results is the reasons for our under performance.
17. Only Good corporate results, probably Lowering Corporate Tax to 25% in budget can be good triggers for market breakout.
18. Until then in the short term, markets are not likely to go anywhere.
19. So selling both PE and CE in weekly options of Bank Nifty.
20. Yesterday I sold Bank Nifty 25000, 25100PE and 25500, 25600, 25700CE.
21. In monthly options, sold 24000PE and 26500CE.
22. In Nifty sold 10000 and 9900PE.
23. Since there is huge shorting by FIIs, if markets fall, they may book profits, which may support the markets at lower levels.
24. SO markets may not fall significantly.
25. I expect Nifty to take support at 10280, if it falls.
26. Next week, stock specific action will begin as Indus Ind Bank, TCS, Infosys all set to declare results.
27. Today Services PMI data will be out around 10.30 am.
28. So far the data has been good, not only in India, all over the world.
29. Bank Nifty will be volatile due to expiry.
30. Nifty is likely to trade in the range 10450 - 10550.