Month: June 2022

Categories
Daily Reports

Daily Report 17-Jun-22

Market reacted to 75 bps hike by US Fed on Thursday, Indian market was down by around 2%.  

Wall Street was down by 2.42% to 4.08%.  Recession fear grips the market as US Fed set the goal clear to bring inflation under control.  DOW30 closed below 30000 level mark.

Direct Tax Collections Jump 51%, Advance Tax Mop-Up Rises 48% In Q1 FY23.

VIX @ 22.87: Yesterday’s opening hour trade – cooled-off as per expectation, but sell-off triggered sharp rebound in VIX.  If VIX manages to go above 25 – expect more volatility.

Approach on Indices: SGX Nifty indicates flat opening around 15350 level, as we mentioned around closing time – high VIX and Indices below May & March 2022 lows create deadly combination.  

SGX Nifty @ 15352.50 up 43 points at 7:50 AM

Whether Indices could witness after a sharp sell-off?  Indices at fresh 52-week-low making technical chart looks highly bearish and indicate worst is yet to come, we expect sell-off in first half to yesterday low or even lower and any sustainable bounce likely in 2nd half or on Monday.  FII long exposure continue below 12%.

Click on the attachment to read the full report:
17-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 16-Jun-22

US Fed increase rate by 75 bps, highest hike since November 1994.  US Fed guides rate by 3.4% by 2022, 3.8% by 2023 & 3.4% by 2024.

Fed Chair Powell: Don’t expect move of 75 bps to be common, next rate hike could be 50 bps or 75 bps based on data.

VIX @ 22.15: Increase yesterday in last half hour – going into US Fed event, we expect to cool-off significantly today.

Approach on Indices: SGX Nifty indicates opening around 15800 level & weekly option expiry will play its role after initial opening.  

Market View: went into US Fed event with binary expectation, witness sharp increase in premium in last half hour, will witness premium erosion in opening trade.  US market reaction post Fed meeting have been muted.  Major event is out, expect a relief rally, time to accumulate stocks with recent low as review

Going into US Fed event, we expect 300 points gap-up / gap-down opening but market opening indicates around 100 points gap-up opening.  Market continues to trade in oversold zone, we still remain optimistic and expect Nifty to test 16000 & Banknifty to test 34000 during the day today.

Click on the attachment to read the full report:
16-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 15-Jun-22

After a sharp move on Monday, yesterday was a volatile session trading in narrow range.  F&O data indicates market currently in oversold zone. WPI inflation @ 15.9%.

Wall Street ended with minor cuts; Nasdaq was flat to positive with 0.18% gain.  

VIX @ 21.89: Still within comfort level.  Will be watching VIX closely today as going into US FOMC outcome tonight.

Approach on Indices: Evenly poised for 500 points move on Nifty on either side.  F&O data indicates highly oversold zone.

Market View: 75 bps hike by US Fed is factored in and Indian market and F&O data indicates – currently in highly oversold zone.  After yesterday F&O data reading, we see strong chance of sharp bounce, still market will go into event on a cautious note.

Click on the attachment to read the full report:
15-Jun-2022-Daily-Report.pdf
View Document
Categories
Uncategorized

Daily Report 14-Jun-22

US Inflation data released on Friday triggered global sell-off and Indian market was down by 2.64% to 3.88%.

Wall Street continue weak trend from Friday and was down by 2.79% to 4.68%.  S&P 500 confirms bear market – is down more than 20% from its peak.

Bitcoin fell as much as 14% on Monday after major U.S. cryptocurrency lending company Celsius Network froze withdrawals and transfers citing “extreme” market conditions.

VIX @ 22.36: was up 14.26% yesterday and in case VIX moves above 25 ahead of US FOMC meeting outcome – expect heavy volatility.

Approach on Indices: F&O data indicates highly oversold zone, but overall trend and technical indicates downward bias.  Any bounce back to be used as shorting opportunity till US FOMC outcome.

SGX Nifty @ 15697.50 down 81 points at 8:20 AM.

Click on the attachment to read the full report:
14-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 13-Jun-22

Wall Street was down from 2.73% to 3.52% as growth stocks continue to drag market down.  Going into US FOMC meeting outcome on 15-Jun-22, risk-off continues

Meltdown in Crypto currency continues as Bitcoin now below $26000.  Dollar Index @ 104.373 & US 10-year bond yield @ 3.20%.

VIX @ 19.58: today likely to open around 22 level.  We would turn cautious if VIX crosses 25 level.

Approach on Indices: SGX Nifty indicates opening around 15860 level, back to March & May 2022 lows, approaching 3rd time. 

Market View: Market approach “Play for June – Technical bounce” now seems to be over and we need to closely watch whether the market is able to hold on to it.  Global risk-off continues as tight monitory policy will money will move to safe asset classes.

Wall Street was down from 2.73% to 3.52% as growth stocks continue to drag market down.  Going into US FOMC meeting outcome on 15-Jun-22, risk-off continues

Next major event for global market is US FOMC meeting outcome on 15-Jun-22.  Indian market will react to it on 16-Jun-22.  Indian inflation & IIP data due to released today & WPI data to be released on 14-Jun-22.  Remain light & prefer hedge position.

Click on the attachment to read the full report:
13-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 9-Jun-22

RBI MPC policy: Repo rate hike by 50 bps, no CRR hike, stance remain at “Withdrawal of Accommodation” Initial reaction to RBI Policy was positive but market failed to hold on to gains.

Wall Street ended with around 1% cut, as chip maker Intel was down more than 5% after CITI cut its earning estimate.  

Crude oil at 13-week high, Brent crude oil near $125.  US 10-year bond yield back above
3%.

VIX @ 19.84: Market showing weakness, any sharp increase in VIX could bring more volatility, if VIX above 22 – time to turn cautious.

Approach on Indices: Closing on Nifty below 16366 & Banknifty below 34860 – could open downside level of tested in May 2022.

Market View: RBI event failed to trigger rally in market is a cause of concern, ECB meeting outcome today & US inflation data on Friday will provide further cues.  

Nifty PCR @ 0.72 indicates – market is currently in oversold zone ahead of weekly options expiry today.  

Click on the attachment to read the full report:
9-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 8-Jun-22

Going into RBI MPC outcome today at 10:00 AM, global cues are positive as SGX Nifty indicates opening around 16500.  Market will take further directional view from policy outcome today.  

World Bank cuts India economic forecast for FY23 to 7.5%, In April this year World
Bank had revise GDP forecast to 8% from 8.7% earlier.

Approach on Indices: Nifty above 16752 & Banknifty above 35693 could open up further upside with yesterday’s low as potential reversal.

India’s 10-year G-Sec have crossed 7.50%, higher bond yield will be negative for PSU Banks as it would reduce treasury gains.  Tomorrow’s ECB meeting will also be an important event for global market.

SGX Nifty @ 16508 up 83.50 points at 8:05 AM.  We are expecting no major surprise from RBI MPC policy and expect market to react positively post event.  We see fear & pessimism is overdone and current level & will review if lower level are tested again.

Click on the attachment to read the full report:
8-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 7-Jun-22

Indian market ended flat, with weak opening manage to turn flat and closed with minor loss.  Cement stocks continue to witness selling pressure taking cues from Friday.  

Wall Street ended mix with Growth stocks doing well, but inflation concerns are back in focus as Natural Gas prices hits record high @ $9.384.  US 10-year back above 3% and near to high in May 2022, currently @ 3.05%.

SGX Nifty @ 16456 down 116 points at 7:55 AM

Approach on Indices: Next decisive move is expected tomorrow post RBI MPC policy outcome.  Till Nifty is holding 16366 & Banknifty @ 34860 today’s dip could be buying opportunity, but expect event base volatility.

Defense stocks will be focus as Defense ministry approve 76k crore upgradation through indigenous companies.  It could be big boost for domestic defense companies.  Defense theme continue to remain robust – most of companies have order book 2x – 3 x of last year total Sales.

Click on the attachment to read the full report:
7-Jun-2022-Daily-Report.pdf
View Document
Categories
Daily Reports

Daily Report 6-Jun-22

Indian market gave up early gains on Friday after gap-up opening and facing resistance on Nifty around 16752 – 16800 level, going into important US Jobs data.

US Jobs data on Friday: Non-Farm Employment change came actual at 390k Vs estimate of 325k – was ahead of expectation, strong data lead to growth stocks correcting.  

SGX Nifty @ 16518 down 71 points at 8:10 AM.

Technical Highlight: Nifty correction from 17377 to 15740 – retracement @ 61.8% comes at 16752 – Nifty corrected from this level.

Defense sector will continue to provide hiding opportunity or momentum play, Banking stocks will be in focus and we expect some positive build up going into event.  Today’s weak opening is on back of global news, but remain positive going into Monday’s trade.

Click on the attachment to read the full report:
6-Jun-2022-Daily-Report.pdf
View Document
Categories
Research Report

Global Report – Food Inflation & Energy Inflation

This week we will discuss inflation concern comes mainly from food inflation and another important contributor to inflation is high energy prices (Oil & Gas).   After Russia-Ukraine crisis since 24-Feb-22 and sanctions on Russia by US & other European countries inflation have sky rocketed.

Food inflation

The FAO Food Price Index dropped 0.6% mom to 157.4 in May of 2022, the second month of declines, but still remained close to a record high of 159.7 points hit in March.

Energy inflation – Crude oil & Natural Gas

OPEC+ meeting delivered only a modest increase in output despite speculations of a bigger supply boost. 

The group of major producers decided to increase output by 648,000 barrels per day in July and August instead of the previously agreed 432,000 bpd, in a move that was seen as hardly enough to compensate for lost supply from Russia.

Central banks meeting this month will try to do a balancing act and try to calm the market but Central banks could do very little to solve supply side problem and could end up doing destruction in an attempt to bring inflation down.

Click on the attachment to read the full report:
Global Market – Food Inflation & Energy inflation.pdf
View Document