*Market Wrap: 14/06/2017 (17:00)*
*NSE-NF (June): 9638 (+23; +0.24%) (TTM PE: 24.35; Near 2 SD of 25; TTM
EPS: 395; NS-9618)*
*NSE-BNF (June): 23492 (+43; +0.18%) (TTM PE: 29.56; Near 3 SD of 30;
TTM EPS: 795; BNS-23499)*
*For 15/06/2017:*
*Key support for NF: 9580-9525*
*Key resistance for NF: 9675-9715*
*Key support for BNF: 23350-23200*
*Key resistance for BNF: 23650-23750*
*Time & Price action suggests that, Nifty Fut (May) has to sustain over
9675 area for further rally towards 9715-9770 & 9825-9865 in the short
term (under bullish case scenario).*
*On flip side, sustaining below 9655 area, NF may fall towards 9580-9525
& 9490-9395 area in the short term (under bear case scenario).*
*Similarly, BNF has to sustain over 23650 area for further rally towards
23750-23875 & 24000-24100 area in the near term (under bullish case
scenario).*
*On the flip side, sustaining below 23600 area, BNF may fall towards
23350-23200 & 23050-22950 area in the near term (under bear case scenario).*
Nifty Fut (June) today closed around 9638, almost 23 points up after
trading most of the days in sideways; it made a late day high of 9647
and opening session low of 9598 and made some recovery in the last hour
supported by sharp pull back of midcap index and soma PSBS amid
consolidation buzz of the sector.
Indian market today opened almost flat amid mixed global cues. Overnight
US market, DJ-30 closed in positive (+0.44%) at another record high
following better than expected core PPI and some bounce back in tech
shares. Also, US AG Session’s senate testimony was positive for the
market as he declined to say anything about his or Trump’s alleged link
with Russia citing “executive privilege”. But, still we may see more
such US political jitters regarding Trump-Russia election link as US
senate may be very serious to investigate the actual truth behind it.
Globally, today all focus will be on the deluge of US economic data and
Fed, which is poised to hike 0.25%, if it springs no nasty surprise. But
more than rate cut, market may emphasize more on Fed’s statement, its
future guidance/dot-plots, economic projection etc for another hike in
Dec’17 or not as Sep is now being virtually ruled out. So, it may be a
dovish hike today by Fed, but Yellen may indicate gradual B/S tapering
from Sep/Dec’17 onwards in lieu of further rate hike in 2017 amid soft
US economic data & poor visibility of “Trumponomics”. A taper tantrum by
Fed may not be good for the risk assets as it will be the indication of
real normalization (Fed still reinvests maturity proceeds from the QE
bonds in the USTSY & MSBS and selling of those QE bonds may hamper
market liquidity seriously)
In the morning today, China flashed an upbeat IIP & Retail data, but
China market was trading in negative as better Chinese economic data may
not be good for stimulus hungry market; PBOC may continue to keep its
present neutral monetary policy except some targeted MLF. Also, fixed
investment data from China came below expectation, which may be also not
good for the overall Chinese economy. But, later upbeat GDP projection
by IMF has supported the China/Asian market sentiment along with India also.
For India, WPI came today at 2.17% for May (YOY) against estimate of
3.11% (prior: 3.85%), which may have also supported the market sentiment
as it will keep more pressure on the RBI to cut in August. Also,
invocation of IBC act by RBI may have supported some private banks
(ICICI) today, although in the short term, banks may have to take huge
haircuts. At the same time, IBC may itself face various legal hurdles,
times and challenges, which may also raise serious questions of the
actual resolution itself.
PSBS were in the limelight after Govt identifies some big PSU Banks
(BOB, Corp Bank), having sufficient B/S strength for consolidation with
other small PSBS (like Dena bank). RIL was in the limelight after TRAI
data shows blockbuster customer acquisitions for April with leadership
position in WL BB.
Overall, today domestic market was choppy amid some concern of GST
disruptions as Govt is committed for the 1^st July launch with barely 17
days in hand and the nation/business community may not be yet fully yet
prepared for the implementation of the same. The present GST format may
be too complex and compliance cost may also be significant. The main
purpose of this GST launch in a hurry without considering the
stakeholders lack of preparation may be Govt’s larger aim to track all
the business transactions and stop the revenue leakage loopholes thereby
(war against unaccounted money). The GST may be simplified by next few
years after initial feedback. But, market may be apprehending some
adverse effect on the corporate earnings in Q1& Q2FY18 because of GST
disruptions.
Today Nifty was dragged by Yes Bank, ITC, HDFC, ACC, Tata Steel and some
Pharma shares (Cipla, Auro Pharma).
Elsewhere, Oil was under pressure after surprised inventory buildup in
API data yesterday; today official EIA data will be in focus. Recently,
we have seen major divergence between API & EIA oil inventories data.
Also, a report from IEA highlighting increased oil production from NOPEC
countries and resumption of Nigeria & Libya oil field may be again
causing some pressure on oil for the concern of increasing supply glut.
Meanwhile, USD Plunged After Subdued Core CPI & Terrible Retail Sales
Data Ahead Of Fed.
US just flashed the data for May as:
Core CPI (MOM): 0.1% (EST: 0.2%; PRIOR: 0.1%)
Core CPI (YOY): 1.7% (EST: 1.9%; PRIOR: 1.9%)
CPI (MOM): -0.1% (EST: 0.1%; PRIOR: 0.2%)
CPI (YOY): 1.9% (EST: 2%; PRIOR: 2.2%)
Core Retail Sales (MOM): -0.3% (EST: 0.2%; PRIOR: 0.4%)
Retail Sales (MOM): -0.3% (EST: 0.1%; PRIOR: 0.4%)
In one word, overall data may be quite terrible and although Fed may
hike today, it may be a “dovish hike” and probability for a Sep hike is
now plummeted to 18% vs 24% and for Dec, FFR is now showing 46% vs 53%
before the data. Market may be now discounting no Fed hike in Sep as
also in Dec’17. Fed may shift to neutral stance in the months ahead with
some hints of gradual tapering of its huge B/S.
After CPI & retail sales data, USDJPY plunged to 109.30 level and EURUSD
jumped to 1.1278 zone. Gold also rallied to almost 1280 level.
*Technically, USDJPY (109.25) need to stay over 109.15 now; otherwise it
may fall towards 108.15-107.20 & 106.15 before or after Fed depending
upon Yellen’s script.*
<https://1.bp.blogspot.com/-ECZGL5_Vr6o/WUFAB3m1olI/AAAAAAAAMDY/yuR2TVFPVNEV8Tys1w26ouIBkexwCbRHgCLcBGAs/s1600/SGX-NF-PATTERN-14-06-2017.png>
SGX-NF
<https://1.bp.blogspot.com/-e9iq7hrjMSY/WUFAEo8B5rI/AAAAAAAAMDc/os4glcxsSFEuGyRizQmg7rPB9_ybbqnoQCLcBGAs/s1600/BNF-PATTERN-14-06-2017.png>
BNF
<https://4.bp.blogspot.com/-zAqnwBARS-c/WUFAHcZ8jXI/AAAAAAAAMDg/A2AWarJ01lQgNfEe79qxX3A1Dxdo0K93gCLcBGAs/s1600/USDJPY-PATTERN-14-06-2017.png>
USDJPY
<https://4.bp.blogspot.com/-5h9rwZkVtTU/WUFALvm5uBI/AAAAAAAAMDk/oDMzaEw_iwIhDn1QuUBt8p_-u_6jFodXACLcBGAs/s1600/Frontiza-Logo.png>
Article Courtesy: frontiza.com
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https://t.me/MarketLive_free
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