*Market Mantra: 28/12/2016 (08:30)*
*Watch 8050-7980 & 8085-8120 Zone In Nifty Fut (Dec), Which May Open
Around 8035 Today*
*BNF need to sustain above 18000-18150 zone for any further “Santa Rally”.*
*Tax Reforms Talk By The Govt May Help; But Strong USD & Oil And FPI Tax
Issues May Also Be A Concern Apart From The Ongoing Demonetization Led
Economical & Political Disruptions *
As par early SGX indication, Nifty Fut (Dec) may open around 8035 (+11
points), almost flat following tepid global/Asian cues.
Overnight, US economic data (consumer confidence, home sales, Mfg index)
was upbeat & better than expected and in the morning, Japanese economic
data came mixed (IIP below estimate; but retail sales was good/above
estimates). As a result, USDJPY is gaining some traction and except EUR,
USD has some strength. Due to thin liquidity for Christmas & Yearend
holiday, ECB has suspended its bond buying for some days and that’s
helping the EUR yields at this moment.
Back to home, after yesterday’s direct tax reform talks by the FM, NITI
Ayog; i.e. panel of economic advisers of the PM has suggested more
direct & indirect tax reforms for India to continue its economic reform
and greater compliances & less corruptions (less creation of unaccounted
money).
Although, such tax reform should have been done long before the extreme
step taken like demonetization as was also suggested by the former RBI
Gov (Rajan), this will be definitely a positive step, if implemented in
the right spirit.
But, considering the present fiscal deficit scenario combined for both
the states & the centre and a huge fall in revenue after sudden
demonetization, it may also be very difficult to implement a significant
lower tax regime in the immediate future for the Govt. For tax
compliances, India need a robust IT infra and a social security types of
cards as in a developed economy’ Aadhar Card & PAN Card may help, if
implemented in a right way (data mining).
Apart from the tax reforms, “stimulus” & “dream budget” talks and any
further steps towards “war against black money & corruption”, market
will also look into the monthly auto sales, PMI & other high frequency
data for Dec to gauze the immediate real impact of the demonetization on
the economy and Q3FY16 earnings & GDP trajectory.
Demonetization led political disruptions may also hog the limelight
ahead of another pay day coming shortly; but an apparent fractured
“united” opposition may also be good for the BJP/Govt ahead of UP elections.
*_Hints for actionable trading ideas:_*
*Technically, NF has to sustain over 8085-8120* zone for further rebound
towards 8170/8200*-8245 & 8295*-8345 area for the day (under bullish
case scenario).*
*On the other side, sustaining below 8050-8015* zone, NF may further
fall towards 7980-7945* & 7915/7890*-7840 area for the day (under bear
case scenario).*
*Similarly, BNF (LTP: 17875) need to stay above 18000-18150* area for
further pull back towards 18300*-18450 & 18700*-18800 zone for the day
(under bullish case scenario).*
*On the down side, sustaining below 17700-17600* zone, BNF may further
fall towards 17500-17300* & 17200*-16975 area for the day (under bear
case scenario).*
<https://2.bp.blogspot.com/-5tnoIkRZoXE/WGM39_xpotI/AAAAAAAAJ-w/zwsGQr1CzbwO2jKqETWImQAjLNiVQb6aACLcB/s1600/NF-PATTERN-27-12-2016.png>
NF
<https://2.bp.blogspot.com/-GawLKpyl6Zw/WGM4AOFW4HI/AAAAAAAAJ-0/QoLE0uRUdBspT_ViPUc8ohSSI9OodQf5gCLcB/s1600/BNF-PATTERN-27-12-2016.png>
BNF *
*
--
Thanks & Regards,
Asis Ghosh
--
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