Market Outlook – 28 July 2017

Markets At New High; Nifty July Expiry Ends Above 10000 With A Gain Of Nearly 520 Points; Bank Nifty Crosses 25000; Long Term Trend Remains Up; But May See Consolidation Soon; Avoid Pharma, Infra Stocks For Buying.

NIFTYNifty closed lower near the yesterday’s close, at 10020.55 on Thursday after hitting record highs at 10114.85 as traders took a breather and booked profits from long positions on F&O Expiry.

On the daily charts, after successfully crossed 9930 resistance, Nifty has made new lifetime highs in last four occasions. Since then, we are advising traders to look for a buying opportunity in the index as well as in individual stocks and suggesting them to avoid making short positions.

However, today Nifty could not manage to sustain higher levels and closed near the lows, that is mainly due to profit booking in last couple of hours. We have seen a gain of nearly 300 points in last eight trading days in Nifty (approximately 3% of up move). After a robust move in the Nifty, the Index took a respite at current levels.

If we talk about this Expiry, July month has given us a stupendous gain of 520 points (biggest in last six months after January, 2017). After run up like these and for the fact that Nifty has closed near the lows, start of consolidation or even a correction could not be neglected. Consequently, positional traders should look to avoid the index and continue buying in blue chip stocks on dips and consolidations.

Most of the Banking stocks like YESBANK, INDUSINDBK, and ICICIBK hit fresh 52-week high today. Furthermore, NIFTY 50 stocks keep on making new 52-week high including RELIANCE, VEDL, EICHERMOT and many more. Traders may look for a buying opportunity in these stocks.

BANK NIFTY: Bank Nifty has again made new lifetime highs (fourth in a row) at 25032. Index started with a gap up and crossed 25000 for the first time. However, index confronted with a sharp dip in last hour due to profit booking and closed below 25000 with a gain of 235 points.

On the daily charts, Bank Nifty continues to make new highs; in fact this is eighth high the index made in last nine days. This is unbelievable. The US Federal Reserve kept the policy rate unchanged at the end of its two-day rate-setting meeting, which concluded on Wednesday (July 26). We should wait for the market reaction to this before executing trades. Therefore, swing traders should wait next execution.

However, trend remains up in Bank Nifty hence intraday traders should continue to trade on the long side on dips only. Avoid short sell.

TECHNICAL PICKS

COMPANY NAME CMP B/S RATIONALE
BHEL 142 BUY Intermediate and Short Term Trend is down in BHEL. The stock has seen a sharp decline and then an upside correction. Prices are now finding resistance at higher levels. We may see a decline here. Sell this stock below 142. If this trade executes then place a stop at 144 and a target at 138.
INDIGO 1248 BUY Intermediate and Short Term Trend is very strong on upside in INDIGO. The stock has seen a sharp decline and then started trading inside a range. We may see a breakout here. Buy this stock above 1250. If this trade executes then place a stop at 1235 and a target at 1280.

DERIVATIVE PICKS

Stock Name Strike Price Buy/Sell CMP Initiation Stop Loss Target Remarks
ICICI BANK JULY FUT SELL 307.25 BELOW 306 312 297-295 OI Increase
Long Buildup Short Buildup
Stocks Price Price% OI % OI Stocks Price Price% OI % OI
HDFC.17.07 Jul 1728.2 5.78 2.46 5007000 TCS.17.07 Jul 2481.5 -3.06 6.35 2560000
GODREJCP.17.07 Jul 1073.95 4.6 7.9 852000 TATAMTRDVR.17.07 Jul 262.25 -3.05 3.64 9025800
TATAELXSI.17.07 Jul 1736.5 3.44 3.72 780800 BHARTIARTL.17.07 Jul 416.1 -2.53 1.92 11663700
CHOLAFIN.17.07 Jul 1178.35 2.94 5.68 316500 MANAPPURAM.17.07 Jul 104.35 -2.48 3.16 10386000
DABUR.17.07 Jul 311.9 1.91 3.66 5167500 JISLJALEQS.17.07 Jul 105.65 -2.31 2.03 18567000
                                                                           Short covering                                                                               Long Unwinding
SUZLON.17.07 Jul 4.45 -5.76 2.41E+08 19.95 SINTEX.17.07 Jul 34.75 -5.05 -8.24 13886625
YESBANK.17.07 Jul 4.18 -1.2 4724300 1785.8 IDBI.17.07 Jul 59.5 -4.72 -30.54 9096000
IGL.17.07 Jul 3.64 -3.59 650100 1177.15 SREINFRA.17.07 Jul 119.15 -4.18 -6.95 4350000
BHARATFIN.17.07 Jul 3.52 -10.72 5157000 818.4 BANKINDIA.17.07 Jul 154.85 -3.94 -35.27 5694000
VOLTAS.17.07 Jul 3.33 -29.25 2148000 516.05 CUMMINSIND.17.07 Jul 959.5 -3.84 -12.56 208800

TOP DELIVERY PERCENTAGE

Stocks Price %Chg Vol Delivery Del % % Change
Sectors Price Change % Quantity
Infosys Limited 971.05 -2.31 6338376 2857462 83.19 Nifty 50 10020.55 0 75750
Kotak Mahindra Bank Limi 998.15 1.18 2564843 1505873 82.89 Nifty Bank 24922.4 1.02 75750
Container Corp of India 1164.4 -0.73 346168 209981 81.31 Nifty IT 10612.3 -1.58 75750
NESTLEIND 6799.65 0.21 65349 29509 81.24 INDIA VIX 11.22 0.43 75750
Tata Power Co. Ltd. 82 -0.67 2646710 7614411 79.89 Nifty Pharma 9880.25 -1.56 75750
Oil & Natural Gas Corp 162.9 -0.67 12361915 6967608 76.21 Nifty Realty 281.9 -0.23 75750
Bharat Petroleum Ltd 477.2 1.23 3555501 2437191 75.49 Nifty Infrastructure 3376.15 -0.44 75750
Kirloskar Cummins Ltd. 959.6 -4.03 384155 291362 74.53 Nifty PSU Bank 3568 -0.14 75750
Hindustan Unilever Ltd 1171.9 0.63 2090566 1162463 74.36 Nifty Auto 10919 -0.77 75750
HDFC Ltd. 1728.2 5.8 9028580 3691560 73.26 Nifty Metal 3250.35 -1 75750

UPCOMING ECONOMIC DATA

                                      Domestic                                                                                                                    International
•RBI Monetary Policy on 02nd August, 2017. •US GDP Data Q2 (QoQ) on 28th July 2017.

         

CORPORATE NEWS

•Coal India has asked five of its seven subsidiaries to keep aside a total of 40 million tonnes of coal for auction to independent power producers under the Shakti scheme.

•Mahindra & Mahindra (M&M) is in race for a $6 billion order from the US government for postal delivery vehicles, and will submit over a dozen prototypes for road-testing between September and November this year as the process enters its final round.

•In line with Hydrocarbon Vision 2030 for North-East Region, ONGC management has approved additional investment of Rs 3104 Crore for drilling of wells and creation of surface facilities to produce gas from Tripura gas fields.

•ITC increased cigarette prices by 4-8% on Monday, a week after the GST Council imposed a cess to make up for lower tax incidence under the new regime on a class of goods tagged as sin products. Premium brands like Classic and Gold Flake Kings have seen the sharpest hike in prices.

Source: Economics Times, Capitaline

BOARD MEETINGS

Company Name Purpose Date Company Name Purpose Date
ALEMBICLTD Results 28-Jul-17 INDRAMEDCO Results 28-Jul-17
ASTEC Results/Others 28-Jul-17 KARURVYSYA Results 28-Jul-17
ASTRAMICRO Results 28-Jul-17 LICHSGFIN Results 28-Jul-17
COROMANDEL Results 28-Jul-17 LT Results/Others 28-Jul-17
EQUITAS Results 28-Jul-17 NDTV Results 28-Jul-17
ESCORTS Results 28-Jul-17 NIITLTD Results 28-Jul-17
INDIACEM Results 28-Jul-17 SKFINDIA Results/Others 28-Jul-17

CORPORATE ACTION 

Company Name Purpose Ex-Date Company Name Purpose Ex-Date
AMARAJABAT Dividend – Rs. – 4.2500 28-Jul-17 EMKAY Dividend – Rs. – 1.0000 28-Jul-17
BHARATFORG Final Dividend – Rs. – 5.0000 28-Jul-17 ICRA Dividend – Rs. – 27.0000 28-Jul-17
BRITANNIA Dividend – Rs. – 22.0000 28-Jul-17 KOVAI Dividend – Rs. – 2.5000 28-Jul-17
CEATLTD Dividend – Rs. – 11.5000 28-Jul-17 LAXMIMACH Dividend – Rs. – 35.0000 28-Jul-17
CENTURYTEX Dividend – Rs. – 5.5000 28-Jul-17 NITINCAST Dividend – Rs. – 1.0000 28-Jul-17
DHUNTEAIND Dividend – Rs. – 8.0000 28-Jul-17 WHEELS Final Dividend – Rs. – 8.0000 28-Jul-17
DPL Dividend – Rs. – 2.0000 28-Jul-17 ADANIENT Dividend – Rs. – 0.4000 31-Jul-17

DISCLOSURE IN PURSUANCE OF SECTION 19 OF SEBI (RA) REGULATION 2014

Elite Wealth Advisors Limited does/does not do business with companies covered in its research reports. Investors should be aware that the Elite Wealth Advisors Limited may/may not have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as read more


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