Month: January 2023

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Daily Reports

Daily Report 31-Jan-23

FII net seller by 6792 crores in equity, highest single day sell-figure in recent times, FII net seller in equity in January 2023 is now at 36025 crores.

Abu Dhabi’s IHC to invest 3260 crores in ADANI enterprise FPO.  Today will be important day for ADANIENTER FPO and market sentiment.

IMF raises economic outlook for first time this year, world GDP likely to be 2.9% Vs 2.7% projected earlier.

VIX @ 17.71: expect volatility to continue going into event tomorrow

Approach on Indices: Earlier Indices found major support on Nifty @ 17775 & Banknifty @ 41597 and once this level were broken, indices tested lower level.  Now this level could act as resistance level.  Nifty resistance zone 17775 & 18041 & Banknifty around 41024 & 41597.

Market View: Going into budget and US Fed meeting tomorrow evening, we expect some relief rally going today as ADANIENTER FPO news.  We would prefer to increase cash level by 25% to 35% as per conviction as wait for this event to conclude.

SGX Nifty @ 17802 up 97 points at 8:15 AM

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Daily Reports

Daily Report 30-Jan-23

ADANI group released 413-pages response to HINDENBURG research report, says it a “calculated attach on India”.

Earnings in focus: BAJAJFINSV, BPCL, GAIL, LT, MAZDOCK, SRF & TECHM quarterly result in focus.

Banknifty PCR @ 0.48, indicate highly oversold zone.  FII long now stands at 25.42% Vs 74.58% short, net short by 58622 contracts in index futures

VIX @ 17.32: could test 24 – 25 level, expect high volatility.

Approach on Indices: Nifty @ 17775 & Banknifty @ 41597 will now act as resistance level and could provide opportunity to reduces exposure and go fresh short.  High volatility to continue. 

Market View: ADANI group clarification of 413-pages and their decision to continue with FPO with same price range could be positive.  We do not have any view of ADANI group stocks; we would find opportunity in other stocks with view beyond budget.  We would prefer to cash level around 25% to 30% going into Budget.

SGX Nifty @ 17724.50 up 35 points at 8:20 AM

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30-Jan-23 Daily-Report.pdf
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Weekly Reports

28-Jan-23 Technical & Fundamental Insight

Last week – review:

Indian major indices finally manage break-out on lower side on back of ADANI group stocks seen sharp fall on HINDENBURG research report which claim to be biggest con in Indian corporate history.  Adani group had declined their allegations and may explore legal actions against the HINDENBURG research.

Approach on Technical: Indices break-down on lower end of the range was followed by brutal sell-off as ADANI group stocks feared massive sell-off. 

Our strategy for this week will to play for potential short covering on Nifty around 17580 for bounce up to 17775 & Banknifty bounce could be sharp to 41024 & 41597.  We would prefer hedge position only on either side due to Budget & US Fed outcome.

Fundamental Insight

1) India Enters Green Bond Market With $1 Billion Debut Auction.  First Tranche Of Sovereign Green Bonds Sold At A Thin ‘Greenium’
2) India’s Forex Reserves Rise By $1.73 Billion To $573.7 Billion
3) Russian Oil Exports To India May Hit New Highs As Interest Grows
4) India’s Services Exports To Cross $300 Billion Target For This Fiscal, Says Piyush Goyal
5) Worst Of Inflation, Growth And Currency Crises Behind Us: RBI Governor Das

Market View & Strategy

MSCI on Saturday said that it is seeking feedback on ADANI group stocks and that may impact the eligibility of those relevant securities for the MSCI global investable market indexes.

Technical chart has turned weak, so market will face selling pressure on every rise unless there some concrete positive news which could provide fresh trigger to market, budget is key event and we will be watching closely with optimistic view.

We do not have any view on ADANI group stocks, bearish or bullish but this is the first time we have seen more impact on other stocks as market was trading in range for some time and needed a reason for correction.  We do not rule this correction as buying opportunity and we would be going by strategy on Monday & Tuesday and mostly likely avoid fresh positional view on Wednesday that is Budget-day.

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28-Jan-23 Fundamental & Technical Insight.pdf
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Research Report

Global Market – US Fed, BOE & ECB meeting and Bank of Japan

Global Market- US Fed, BOE & ECB meeting & Bank of Japan

This week we will discuss this week as next week will be very busy for as US Fed meeting on 1-Feb-23, Bank of England & European Central Bank meeting on 2-Feb-23.  We will also discuss how monitory policy by Bank of Japan is framing which is contradictory to its previous policy, inflation data and challenge for global economy.

US Fed meeting outcome on 1-Feb-23

• US Fed is expected to increase rate by 25-bps on 1-Feb-23 with over 99% probability as per Fed fund rate monitor tool.
• Next US Fed meeting on 22-Mar-23 is also factoring 25-bps rate hike, commentary by US Fed chair on 1-Feb-23 will be key to watch out for.

Bank of England outcome on 2-Feb-23

• Bank of England is expected to increase rate by 50-bps on 2-Feb-23.
• Latest inflation figures @ 9.2% for December 2022 released on 18-Jan-23.

European Central Bank on 2-Feb-23

• ECB is expected to increase rate by 50-bps on 2-Feb-23.
• Latest Euro zone inflation came at 9.2% for December, slowdown from 10.1% in November 2022.

Bank of Japan monitory policy at critical stage.

• Latest inflation from Japan as on 27-Jan-23 came at 4.3% Vs expectation of 4.2%.
• Bank of Japan continues to buy around 100% JGB securities which are illiquid and now BOJ is biggest holder of JGB securities.

Equichain Wealth Advisors: Market View & Opinion

In our earlier article we have mentioned global central banks obsession to bring inflation at 2% will come with some pain on economic.  We don’t expect surprise on policy front but commentary will be key to watch out for, we expect comments by US Fed chair Jerome Powell and ECB president Christine Lagarde will be watched closely.  

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Global market -US Fed, BOE & ECB meeting & Bank of Japan.pdf
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Daily Reports

Daily Report 27-Jan-23

Wall Street Advance Q4 GDP came at 2.9% Vs expectation of 2.6%.  Durable good order and Unemployment claims data were better than estimate.

F&O data: new series start with rollover of around 70%.  FII long position in Index futures stands at 38%.  Nifty PCR @ 0.92% compared to 0.81 previous & Banknifty PCR @ 0.62 Vs previous 0.75.

Adani group countered claim made by HINDENBURG research however, volatility will continue in ADANI group stocks.

VIX @ 14.66: expect to move towards 16 level.

Approach on Indices: range of indices is getting narrow and currently trade near lower end of the range.  We would prefer to wait for clarity and take directional view only after breakout.

Market View: going into budget and central banks meeting next week, we would continue to focus on domestic consumption story, we believe any positive trigger could come only after Budget.

Our strategy to increase cash level to 25% – 30% going into Budget.

SGX Nifty @ 18018.50 up 65 points at 8:20 AM

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27-Jan-23 Daily-Report.pdf
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Daily Report 25-Jan-23

Wall Street consolidation continues, MICROSOFT earnings above market estimate.  Yesterday NYSE witness technical glitch and trading was impacted.

F&O expiry for January series: this month continue to remain in narrow range and today’s cues are weak.  Nifty PCR @ 0.81 & Banknifty PCR @ 0.75.

Key earnings to watch out for BAJAJ-AUTO, DLF, DRREDDY & TATAMOTORS.

VIX @ 13.66: expect to trade in range of 14 – 16.

Approach on Indices: Indices continue to face resistance around upper end of the range on Nifty @ 18202 & Banknifty @ 43176.  F&O expiry will limit major move ahead of holiday tomorrow.  

Market View: No budget rally has been seen so far, whether there is some pre-budget rally as 3 trading session after today’s session in key event to watch out for.  There has been no major negative news as well which could trigger major sell -off.

SGX Nifty @ 18100 down 34.50 points at 8:20 AM

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25-Jan-23 Daily-Report.pdf
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Daily Report 24-Jan-23

Wall Street rallied as chip makers and tech stocks help the market.  DOW30 was up by 0.76% & NASDAQ up by 2.01%.  Earnings season picks up as MICROSOFT due to announce result today.

AXISBANK result continue to beat market expectation.  NIM @ 4.26%.  ROA @ 2% & ROE @ 19.81%.  Q3FY23 PAT @ 5853 crores, up 62%.

FII F&O data: FII covered net short above 9000 contract in index futures, net long now stands at 55.82%.

VIX @ 13.62: expect further cool-off till January F&O expiry.

Approach on Indices: Indices are expected to open around 18202 on Nifty & Banknifty around 43176, we expect further upside as technical indicate further trigger possible ahead on final expiry tomorrow for January series.

Market View: We have maintained our bullish stance; market remain in range and now we are expecting positive break-out and pre-budget rally as we have just 5 trading session before Union finance budget on 1-Feb-23.  We expect positive momentum ahead of Budget Day.

SGX Nifty @ 18240 up 93.50 points at 8:10 AM

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24-Jan-23 Daily-Report.pdf
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Daily Report 23-Jan-23

Global market recovered on Friday as risk-on sentiment improved as Dollar Index continue to trade below 102 and US 10-year bond yield below 3.50%.

RELIANCE Q3FY23: mixed quarter, JIO & RETAIL minor disappointment. OIL&GAS remains strong.  Positive reaction expected

ICICIBANK & KOTAKBANK Q3FY23: result above estimate, expected positive reaction on stock prices.  Banknifty could continue to lead the recovery.

VIX @ 13.79: back below 14 indicate further short covering possible.

Approach on Indices: Indices continue to trade in range on Nifty @ 17775 – 18202 & Banknifty in range of 41597 to 42573.  Banknifty closing @ 42506 could attempt towards 43176 which is next resistance / target level.

Market View: We continue to remain in accumulation zone till lower end of range holds on major indices, with final F&O expiry and Budget in view – we would continue to focus on Mid-cap & Small-cap and would accumulate gradually.  Indian market starting this wee on positive note and we see strong probability of breakout on upside.

SGX Nifty @ 18144 up 99.50 points at 8:30 AM

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23-Jan-23 Daily-Report.pdf
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Research Report

Global Market – Bank of Japan, US Economic data & Gold

Global Market- Bank of Japan, US Economic data & GOLD

This week we will discuss Bank of Japan policy, how US Corporate earnings failed to boost the market sentiment and how weak US economic data surprisingly weaken the sentiment and market corrected.  Earlier, strong US economic data would trigger correction in risk-on asset classes a weak economic data would boost sentiment in assets classes.  

Bank of Japan – Change in monitory policy stance

• Bank of Japan maintain ultra-low interest rate policy, kept rate unchanged at -0.1%.
• BOJ: Large scale bond buying to continue as an when needed and maintain yield curve at 0.0%.
• BOJ commit to maintain yield curve control against market expectation of change in policy after last month’s policy decision to increase upper end of yield curve from 0.25% to 0.50%.

US Economic data

In recent months we have seen that market react positively on weak economic data and market turn negative on strong economic data, but on Wednesday market reacted negatively to below estimate PPI & Retail sales data.  This is notable change ahead of next US Fed meeting on 1-Feb-23.

Gold @ $1930

In our article two weeks ago, we have mentioned how global central banks are adding gold to its forex reserve which could also be one of the positive triggers.  In case of any weakening economy or change in monitory policy.  Gold could also be potential beneficiary of de-dollarization in international trade.  We see Gold currently placed in win-win situation.

Equichain Wealth Advisors: Market View & Opinion

We remain optimistic but would turn cautious as corporate earnings so far failed to cheer the market.  Jobs cut announcement continue by big tech companies continues, today Google announce to cut 12000 jobs globally as tech layoffs deepen.  Next week US economic data to watch out for will be Advance GDP q/q on 26-Jan & Core PCE price index m/m on 27-Jan-23.  


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Global market -Bank of Japan, US Economic data & Gold.pdf
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Weekly Reports

21-Jan-23 Technical & Fundamental Insight

Last week – review:

This week started on weak note as indices tested lower end of the range on Nifty around 17775 & Banknifty around 41597.  Indices manage to hold to critical level and also tested upper end of the range where Nifty tested high around 18180 & Banknifty around 42700.  

Major US Banks came with earnings but failed to cheer the market.  US market corrected to weak PPI & Retail sales data, which is trend reversal, earlier weak economic data will have positive impact.

Approach on Technical:  We would wait for clear break-out before taking fresh view, market has been in this range from almost last 3 weeks, consolidation seems to be taking too long, we believe longer the consolidation the move on either side will be sharp & trending.

Nifty above 18202 could open upside to 18547 & 18887.  Nifty below 17775 it could test 17175 & 16733 on lower side.  Banknifty above 42573 could test 43176 & 43723 and below 41597 it could test 41024 & 40048 on lower side.

Fundamental Insight

1) India’s Forex Reserves Zoom By $10.417 Billion To $572 Billion
2) India To Be A $3.7 Trillion Economy In 2023: RBI Article
3) RBI Cautions States Against Reverting To Old Pension Scheme
4) What Are AT1 Bonds And Why They Could Land Yes Bank In Trouble?
5) RBI Tweaks Norms Related To Acquisition For Banks

Market View & Strategy

SGX Nifty is trading at 18127.50 up 53 points as on Friday’s closing trade, reaction to RELIANCE and positive global cues.  ICICIBANK, KOTAKBANK & ULTRACEMCO earnings to be released on Saturday.  On Friday, Banknifty showed some strength on back of HDFC & HDFCBANK taking the lead.  Final F&O expiry for January series is on 25-Jan-23 will play its role ahead of Budget next week on 1-Feb-23.

We remain optimistic till important levels on indices are held, we have maintain this stance for last 3 weeks as market failed to give break-out on either side.  We this week may provide some clarity on Wednesday & Friday.  

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23-Jan-23 Fundamental & Technical Insight.pdf
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