Pre Market Report
1 ) On Friday Govt announced measures along the expected
lines.
2) FPI surcharge was taken away.
3) Surprisingly it was taken away even for domestic equity
investors.
4) Other than this, there was no meaningful announcement.
5) What they did, tried to reverse their bad decisions, no
any good decisions.
6) Just a month before, their attitude was very bad.
7) The only good thing is that the Govt indicated that they
are listening and willing to look at the issues.
8) After the removal FPI surcharge., SGX Nifty shot up more than 150 points.
9) That indicates FPI surcharge is the single most positive
announcement by FM.
10) But when everyone was hoping for a huge gap up today,
the higger tariff announcement came form Trump.
11) And DOW fell 800 points intraday and hence SGX Nifty
also.
12) US-China trade war is not going to and any time
soon.Probably it will not end as long as Trump is in power.
13) Now even central bankers started talking about US-China
trade war.
14) Asian markets are all bleeding. Hong Kong is having
double whammy of trade war and local unrest.
15) Right now SGX Nifty is trading around 10900. SGX Nifty
hit a high of 10947 on Friday night.
16) Just by looking at SGX Nifty level, US China Trade war
is not having any big impact.
17) Buy any rise today will be mainly by short covering.
18) On Friday, despite FM meeting announcement, despite
Nifty moved so much higher, FIIs have sold for more than Rs 1700 crores in Cash
market.
19) So it is better not to take any long positions today.
20 ) We do not know how this Global cues will pan out. Wait
for today and see whether FIIs stop selling and start buying.
21) There is every possibility FIIs will continue to sell.
22) It is not that they are not happy with FM announcement,
now Global risk off may hit them.
23) If there is no more escalation of US China trade war, we
can expect Nifty to expire between 11000 and 11200.
24) But intraday volatility and MTM losses, not everyone can
bear.
25) SGX Nifty has not been a good indicator for the last few
weeks.
26) So we need to see how market opens.
27) Usually first gap up, there will be some selling.
28) After that selling, if markets again moves higher and
breaks morning high, then we can hope for some recovery.
29) Option premiums may start collapsing as the stability
returns.
30) Nifty future may make bigger moves, so predicting a
range will be difficult before the market open.
31) We need to see if India VIX falls or rises.
32) Crude is down by about 2%.
33) Rupee is likely to come under some pressure due to Yuan
depreciation.
34) Generally speaking this FM announcement may become a non
event as Global cues nullify its positive effect.
35) Dow future recovered about 300 points from today's low
is a consolation.
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