Pre Market Report, August 5, 2019 | Stocks and Commodities

August 5, 2019
Time: 8.15 am

Pre Market Report:

1. US markets closed lower on Friday for second day in a row.
2. Asian markets are down.
3. SGX Nifty is down by 70, 80 points.
4. China currency depreciated from 6.97 to 7.07 per US dollar.
5. Everyone is expecting some retaliation by China for US tariff.
6. Hong Kong unrest continues.
7. Hang Seng index fell more than 600 points on top of more than 800 points fall on Friday.
8. We have our own problems as well.
9. Today is 5th of August, exactly one month after budget.
10. Budget has changed everything.
11. Even the most bullish person turning bearish.
12. Income Tax surcharge, 35% share holding, Tax on share buyback, higher registration charges for autos, now Kashmir uncertainty.
13. All kinds of rumours floating around about Kashmir.
14. The most famous one being dividing J&K into one state and 2 union territories.
15. Markets may see a knee jerk reaction.
16. Otherwise Kashmir decisions are not related to stock market.
17. However if unrest continues in Kashmir, then that will have impact in markets.
18. Who knows, August 5 can turn out to be a Feb 26 also.
19. Despite some positive news on Friday that PMO is in talks with FM, FIIs have sold for Rs 2888 crores in Cash market.
20. A similar news that came few weeks before, FM considering FPI surcharge, did not materialise.
21. So this time people are not happy with, "Talks, Consideration". They want firm decision.
22. But now Govt is pre occupied with Kashmir issue, nothing is going to happen on this front in the next few days.
23. Markets are over sold.
24. Everyone is waiting for some bounce, but that may not happen.
25. On Friday Nifty hit a low of 10849 and a high of 11080.
26. As long as the lower end is not broken, we can expect some consolidation.
27. But earlier, this kind of statements were proved wrong in one day.
28. Cabinet meet at 9.30 am, people will be keenly watching the outcome.
29. Govt should act in stock market issue as fast as it is acting on Kashmir issue.
30. What will be the decision by Cabinet on Kashmir issue, How this will be seen by FIIs, what will be the level of unrest in Kashmir all will decide the next few days of market.
31. Volatility will increase and markets are likely to make big moves.
32. Everywhere pessimism now, I am maintaining some short positions to ride this short term volatility.
33. Sold Nifty futures and sole December 10500PE.
34. On intraday bounce, it is good to short with hedge or sell call options.
35. Nifty future should be trading between 10880 and 11120.