Pre Market Report, February 25, 2019 | Stocks and Commodities

February 25, 2019
Time: 8.30 am

Pre Market Report:

1. US markets closed in Green on Friday.
2. Asian markets are positive today.
3. Trump announced extention of deadline for US-China trade talk.
4. Markets are taking this news positively.
5. China markets are up by more than 2.5%.
6. Another big news is GST reduction to housing.
7. This will help real estate companies and housing finance companies.
8. Affordable housing GST is reduced to just 1%.
9. On Friday, FIIs were net buyers in both Cash markets and Index Futures.
10. Stock futures, there was some selling, probabily to hedge their Kotak Bank exposure.
11. Despite good global cues, SGX Nifty is trading almost flat.
12. Crude oil prices are stable after rallying last week.
13. But OMCs did very well on Friday.
14. PFC and REC are moving higher.
15. Generally mid caps and small caps started moving higher.
16. In the short term, worst seems to be over.
17. Earlier I said Nifty may be trading between 10600 and 10900 until expiry.
18. There will be good resistance between 10800 and 10900.
19. Bank Nifty has under performed as Kotak Bank fell due to ING sale.
20. Bank Nifty will find support at 26500.
21. But I am not very bullish in Bank Nifty.
22. So I have gone short in Bank Nifty March future and sold 27000PE, 26500PE, 26000PE in March and 26500PE in February.
23. Banking stocks weightage in Nifty is about 1/3, but Bank Nifty fell about 180 points on Friday, logically Nifty should have fallen 60 points, assuming all other stocks are neutral. But Nifty closed flat. So other stocks compensated for all the losses of Bank Nifty.
24. That shows the resilience of the market.
25. Nifty future may trade between 10750 and 10850.
26. If Nifty fture trades closer to 10750, I am planning to sell 10600PE and if it trades closer to 10850, I am planning to sell 11000CE.
27. I think Nifty will expire between 10600 and 11000 in this series.
28. Under current is strong and news flow is very good, so do not try any short without hedge.