Pre Market Report, August 17, 2020 | Stocks and Commodities

 August 17, 2020

Time: 8.10 am

Pre Market Report:

1. You can register at www.workshop.prsundar.com if you want to attend the workshop.
2. On Friday afternoon, markets fell suddenly.
3. The fall was drastic and everyone was surprised.
4. The fall was triggered by a fall of about 2% in European markets.
5. Europe fell about 2% due to bad Economic data from UK.
6. But later in the evening, US markets recovered and closed mixed.
7. So Asian markets are also mixed.
8. But developed markets are down and emerging markets are up.
9. SGX Nifty is up by about 100 points.
10. That is a huge gap up, surely will scare the short sellers.
11. With this gap up, Nifty retraces more than two third of intraday fall of Friday.
12. Even in my "Dalal Street Week Ahead" I said, Friday's fall is an aberation.
13. The only worry now is that Reliance JIO is being dragged into AGR case.
14. Sine Reliance has already fell about Rs 50 from intraday high on Friday.
15. So we need to see the positioning of traders in Reliance.
16. Since Reliance in the most weighted stock in Nifty 50, that needs to be watched carefully.
17. Despite such a big fall, FIIs did not sell in Cash market.
18. FIIs bought for Rs 46 crores.
19. But DIIs sold for Rs 797 crores.
20. In fact this aggressive selling by DIIs could have triggered the fall.
21. There is some news about ICICI Bank but I do not think that will affect the stock price.
22. Banks fell more, HDFC Bank in particular.
23. So today's recovery should depend on HDFC Bank.
24. Too many stocks entering trading ban.
25. That shows the speculation level.
26. Even stocks like Muthoot and Manappuram which are fairly large companies, entering trading ban.
27. I have position in Auro Pharma.
28. Hope that will come out of trading ban in next few days, otherwise, hedging is not possible.
29. Expect the gap up to be sold into in the first hour, then if Nifty crosses morning high, then only the strength will come.
30. In fact, I am planning to take some (protected) short positions if Nifty opens around 11300.
31. Nifty future may trade between 11180 and 11350.