Pre Market Report, October 14, 2019 | Stocks and Commodities

October 14, 2019
Time: 7.30 am

Pre Market Report:

1. Friday our markets were highly volatile.
2. Earlier also markets were highly volatile but they came with some news flow.
3. Friday markets moved violently without any news flow.
4. Over the weekend we have many positive and negative news.
5. Positives first, FIIs have turned net buyers for Rs 750 crores in Cash market.
6. This is third buy since budget day. This is also going to be one off affair just like last time, or they will continue their buy, only time will tell.
7. At some point selling exhaustion should come and markets should stabilise.
8. US-China partial deal lifted sentiment in US.
9. US markets shot up.
10. Asian markets are generally positive.
11. On negative side, World Bank said India is facing severe slow down.
12. They cut India GDP growth to 6%.
13. IIP data came negative on Friday evening.
14. Though FIIs have turned net buyers, DIIs have turned net sellers for almost same amount.
15. So SGX Nifty is down by 30, 40 points.
16. But SGX Nifty has not been a good indicator for the last few weeks of high volatile markets.
17. In weekly Options, Nifty 11400CE has the highest OI.
18. Among Puts, Nifty 11000PE has highest OI.
19. Generally people think Nifty will trade between 11000 and 11400 this week.
20. This is a bearish view as Nifty closed around 11300 last Friday.
21. I sold 11500CE and 11600CE in weekly Options.
22. Today WPI inflation data will be out around noon.
23. After market hours CPI Inflation data will be released.
24. We need to see how Bank Nifty performs ahead of Inflation data.
25. In US Banks are set to declare results next week which are not expected to be good.
26. Here HDFC Bank commands huge valuation compared to their international peers.
27. That is why some selling comes in Banking stocks in the last few days.
28. There is a genera feel that Banks are over valued.
29. HUL will declare results today after market hours.
30. Wipro, Reliance and HDFC Bank are some of the key results due this week.
31. But Reliance and HDFC Bank will declare results over the weekend and that will reflect in the markets only next week.
32. This week, there is not much news flow.
33. So we can expect some consolidation with positive bias.
34. Sold Bank Nifty weekly options at 29200CE, 29500CE, 29800CE, 30000CE.
35. Premiums are so high due to huge volatility in Banking stocks.
36. In monthly sold 28000 short straddle at Rs 1630 points premium.
37. Just 12 trading sessions, this premiums is very high.
38. But the premium is justified due to huge moves by Banking stocks.
39. European futures are negative after a stellar run on Friday.
40. Nifty future will trade within Friday's range as Friday's range was very huge.
41. Support may come in at 11220 and resistance at 11380.