Tag Archives: Earnings

Market Trade Setup 31st January #NIFTY

Market Trade Setup 31st January

Finally, the expiry day to the longest series which had full 25 trading days is finally here. We have started the series almost at 10800 level and now we are 128 points down for this series. Will this first series of 2019 goes to bulls or bears needs to be seen. Last 2 January series was very positive with over 500 point gain, so in that way, this is going to be a bit of a disappointment. Globally things are looking bright as US jobs data showed some positivity and Fed also said that it would be “patient” in looking at rate hikes. That pushed markets up and Dow gained 400 plus points. The Asian markets are in green with Chinese manufacturing data coming slightly better than expected. 

On the domestic front, the big relief came for the market yesterday with ICICI bank coming up with a good set of results in Q3 and that augers well for the entire banking sector. Added to that was the Sri Krishna committee report that said Chanda Kochhar was at fault and she broke the code of conduct of the bank. Immediately the ICICI board distanced itself from her and sacked her and took away all her post-retirement perks and bonuses. But with no adverse financial implications on the bank because of the fraud, it’s a huge sigh of relief for the bank. Today Apollo Tyres, Airtel, Dabur, Dena Bank, Emami, Hero, India bulls housing finance, Petronet LNG, Power grid, Vedanta and V guard are coming up with their Q3 results.

On the derivatives front, today is the expiry day and if we look at the moves yesterday there was a massive selling on Nifty futures as the market was going up and from 13 point premium, Nifty Jan futures moved into the discount. Yesterday there was a lot of action on Index options and we saw 8.98 lakh crore turn over there itself and the total F&O turnover was 11.19 lakh crore. So, as I said the turnover has crossed 10 lakh crore. Today we might see it crossing 16 lakh crore. The contours are now placed at 10600 put and 10580 is a strong support and on the upside 10800 call has the maximum open interest and so today’s broad expiry contours will be 10580-10800 which is a 200 point range and Nifty put-call ratio is at 1.20 and that means there can be some movement over 10700 for Nifty today to make the PCR adjust upwards.

What is the Nifty call for the day?

Yesterday, I asked you to take long positions if Nifty goes to 10620 mark and if you had taken then you would be sitting on a mild 20 point profit. Today there will be a gap up open for Nifty between 10700-10720 mark and when that is reached you will have an 80-100 point profit. This is your final bonanza for the series and exit around 10700-10720 mark and book profits. 10720-10750 will be the resistance zone so don’t take any risk. On the downside, 10650 will be the support and I would expect the expiry to happen anywhere between 10680-10750 mark with a mild 3 PM move. We have already seen the 3 PM move yesterday also so don’t expect anything great. Be safe and tomorrow onwards we have a lot of cues to deal with including budget so keep your money safely in your pocket.

Market Trade Setup 18th January #NIFTY

Market Setup 18th January

So, yesterday Nifty crossed the 10900 mark and closed above that. But the point to be noted is the last tick was at 10890 and the adjusted value was 10905. So, optically it might look as if Nifty crossed 10900 but in reality, its still sticking to that range, and showing a lot of resistance to freely move up. Yesterday’s options data also saw the Nifty premium losing 14 points from its value at the beginning of the day. On the day when Nifty went up, the put-call ratio should go up but actually, the put-call ratio came down. All this shows things are not as bright as they seem to be and the only bright spot in all this is the Q3 results that came good yesterday.

On the Q3 front, two very important stocks to the economy, Reliance Industries and Hindustan Unilever has come up with their results and together they touch the lives of every Indian be it Jio phone or Lifebuoy soap or Kissan or Ponds range of products. Both have come really good with Reliance giving a big positive surprise in petrochemical business and the Jio also coming up with good numbers. HUL, on the other hand, showed volume growth of 10% whereas the expectation was 6-8% and this is the 5th consecutive double-digit growth in volumes and HUL is ruling the FMCG space in India. PAT came at 1440 Cr which is also a very good number. The only worrying spot is Brent Crude which is again moving towards 62 dollars.

On the derivatives front, as discussed above there was some selling at the higher levels yesterday afternoon after 3 PM in the Nifty futures and the premium suddenly came down by 14 points. The options market also saw put-call ratio falling from 1.54 to 1.52. 10900 put added the maximum open interest of 2.9 lakh positions and now there is some change in the open interests. 10500 still holds the highest open interest but 10700 and 10800 replaced 10000 as the 2nd and 3rd highest open interest. So, for this series 10500 is the base and on call side 11000 still has the highest open interest followed by 11100 and 11200 call. After that, we have open interest building up at 11500 call also.

What is the Nifty call for the day?

These are tough times to trade and we need to be very careful while taking long positions at these levels. Because if you get trapped it becomes impossible to come out as we just have 2 weeks for expiry. There is some bearishness and profit booking at 10900-10920 levels but the positivity of Reliance cannot be ruled out. Reliance is a star performer in Nifty and when Reliance comes up with good numbers markets always celebrate. We are going to start with a celebratory mode with Nifty opening positive between 10930-10960 zone which is a resistance zone. You need to carefully observe where Nifty goes from here. At any point, if it drops below 10950 or 10920 its a caution sign and don’t trade. You can think of taking a long position if Nifty constantly stays above 10950 and if it means you have to wait till 3 PM also to take this position, wait. Don’t hurry up and burn your money. 10950 is the mid-point of a big resistance that stretches from 10920-10980.

Market Setup 24th January

Markets and News

Penultimate day to expiry and things look bit steady. The rapid movement that World saw yesterday seems to have slowed down a bit. US closed higher but the bullishness has decreased a bit. Asia is also trading mixed with Hong Kong and Japan moving between red and green and after a big rally yesterday, today seems to be a day of consolidation. Brent Crude is also back to 70 dollar mark and that will not be a great news for an economy like India.

Coming to India, yesterday was a big day with NIFTY gaining another 100 points to go close to 11100 mark. Sensex crossed 36,000 and it took just 6 trading sessions for the Sensex to cross 1000 points. Things are dangerously moving fast and looks like today is going to be a slow day. In Q3 results United spirits came up with a howler, that says all is not going really well for Q3.

Lets look at the list of companies that are coming up with Q3 today.

1. Biocon
2. Canara bank
3. Container Corp
4. Indiabulls ventures
5. Idea Cellular
6. Indigo airlines
7. Jindal sAW
8. M&M Finance
9. Motilal Oswal
10. Pfizer
11. Pidilite
12. Radiocity
13. Raymonds
14. Saregama
15. TTK Prestige
16. Vijaya bank

Derivatives Action

On the derivatives front, yesterday saw a huge melt up in options positions and many call writers were closing their positions as NIFTY crossed 11000 mark. 11000 saw 29.2 lakh contracts getting covered and 10900 call saw 21 lakh contracts being covered. Even 11100 call also saw 2.1 lakh contracts getting covered. Now the call writing moved to 11200 call where 13.3 lakh contracts were created and premium at 12 rupees. On the put side there was lot of action at 11000 put that had 31.8 lakh contracts followed by 11050 and 11100 puts that had 10 lakh contracts each. That took the NIFTY put call ratio to the highest level in last 10 years to 1.89. This is not good for the market.

What is the NIFTY call for the day?

Nifty is likely to open flat or slightly down between 11060-11080 levels and 11100 is big resistance. If that is negotiated 11120-11150 zone will be the zone to watch out for. But NIFTY is likely to take a break today and might test 11050 levels today first and then 11020 levels. If that is not held 11000 will be the strong support. Today will be driven by Q3 results especially Idea and if the results are good then we might see market holding 11050 levels and might approach 11100.

Shorting the calls according to me is a wise strategy. 11050 call is at 65 rupees ad 11100 call is at 38 rupees. If the market doesnt cross 11100 then you can go for this, not in the morning. Morning you can look at shorting puts, especially 11000 put which is at 19 rupees is very safe if you want to make some money pledging your portfolio.

Q4 Results/Rankings for Indian Companies

Annual Examination Results of Companies.

Like Students have an academic year which starts from June and ends in April, companies also have financial year that starts from April and ends in March. Like students write their exams at the end of academic year and the results of which helps them in promotion, companies also have their annual results that helps their progress. The way an academic year has two semesters, financial year has four quarterly results that are very crucial for companies.

Like the way, you are worried about your semester results companies are also worried about their quarterly results. Recently last quarter results of all the companies have been announced and their full results are out.

Like the student’s results are published in notice board. I am today publishing the ranks of the best performing sectors in India and ten best performing companies in that sector.

Table 1 has the list of Top Ten Sectors.

Pharma and Automobile are the best performing sector and expectedly IT and Telecom are two worst performing sectors.

Sector Net Sales % Ranking PAT % Ranking Avg Ranking of Net Sales and PAT Ranking
Pharma 13.1 2 29.30 3 2.5 1
Banking & Finance 20.5 1 27.80 5 3 2
Automobiles 8.85 4 27.20 2 3 3
Steel, Cement and Real Estate 6.9 6 34.93 1 3.5 4
Engineering 12.5 3 23.90 4 3.5 5
FMCG 7 5 -52.40 8 6.5 6
Agro Based -8.5 9 20.45 6 7.5 7
Software -1 7 -84.70 10 8.5 8
Power -2.4 8 -58.50 9 8.5 9
Telecom -15.7 10 -54.30 7 8.5 10

Table 2 has the list of Top Ten Companies which are ranked according to the Net Sales.

Sector Company Net Sales PAT Ranking
Steel, Cement and Real Estate Dalmia Bharat 27.2 60.20 1
Banking & Finance Yes Bank 23.3 30.20 2
Automobiles Maruti Suzuki 19.8 50.80 3
Software Hexaware technologies 17.1 35.30 4
Pharma GSK Pharma 13.1 6.40 5
Agro Based Grasim Industries 11.4 53.00 6
FMCG Bata India 9.8 29.00 7
Engineering Greaves Cotton 7.4 22.50 8
Power CESC LTD 6.3 19.00 9
Telecom Airtel -12 -70.40 10

 

Like the way, we have the pass percentage declared for students. I am declaring the pass Percentage of the companies that have reported Quarter 4 results. All those companies that have bettered the last year results were taken as pass. Rest of them were deemed to have failed.

So, the final result is 48% pass and 52% fail. Hope the next quarter would be better.

Choose wise, Happy Investing!