Morning Bells (25 Nov 13)

Good Morning Friends.

Thought of the day – Miss anything for your best life but don’t miss best life for anything.

So we are into expiry week, a year back I was an expiry expert and was making good money but since I turned to swing trading that thrill went out. Also when brokers come tricky your position stated making loss due to false panic signals. Well I strongly recommend that if you are not sure always stay away from market in expiry week (or make only few low value bets only) because this is true that in the expiry week either you are hero or zero.

Right now market and specially FIIs turning cautious ahead of state election which will give you a small picture of possibility for Gen. Election in May 2014 (A probability).

Well, The Indian equity market ended off day’s low on Friday with the NSE Nifty just managing to close above the 6000 mark. The benchmark indices which remained under constant pressure throughout the day saw a sudden bounce back amid late buying in the index heavyweights like L&T, Tata Steel, ONGC and Cairn India.

The sugar companies continued to remain in the limelight on hopes that government committee may decide to announce financial assistance for struggling sugar mills as well as an increase in import duties on raw sugar to halt cheaper imports and strengthen domestic prices.

GLOBAL FRONT – EMs V/S INDIA

On global front, the development is a bit disappointing for our country, The sweeping reforms in China along with political uncertainty in India will impact the FII flows into India as re-rating of China would attract more incremental flows into that country.

Also developed economies, especially Europe, are attracting lot of inflows and are on top of the radar of the global fund managers. Result reflected in Sebi’s FII flow data, some USD 633 million has flown into China last week while on a four week basis India has seen outflows of some USD 344 million.

US Index -

US index is making new record every week and its not showing any kind of weakness right now. Historically Dec. always seems a strong month for US economy.

Fed Tapering –

If we look to this statement then sentiment to remain subdued till March 14.

Investors are skeptical over the prospects for a December tapering of stimulus, preferring to focus on March as the starting point for a reduction in the flow of Treasuries and mortgage bonds bought by the Fed, said Andrew Wilkinson, chief economic strategist at Miller Tabak & Co.

But for US Santa Claus rally is on card.

MARKET OUTLOOK –

Ahead of State Assembly result which is due on Dec. 8 I do not see longs rollover, we all also know very well that during the expiry week fundamentals normally don’t works and are ignored by F&O dynamics.

So if you remember my old statement (later I got some confusion for a week’s time but now again seems I should stick to my old view) Nov. expiry seems below Oct’s high and FII outflow trend to continue till next 2-3 weeks starting beginning Dec. expiry.

So most probably FII flow to remain subdued as well as we may see some profit bookings by FIIs fund managers in Dec. to give a fresh start around Santa claus rally or say new year bash.

So probably no strong efforts seem for upmove and giving picture of range bound sessions ahead for few sessions.

Be cautious with 5970 & 5935, breaking of 5970 will wash out of bulls hopes while 5935 will intensify offloading and Nifty can test next stop 5755/5600 while on upside 6230 will again act as strong resistance.

I strongly believe (for high risk takers) that its time to sell OTM CEs and PEs, profit will be less but could be a sure bet. Like we can sell 62CE and 59PE.

OPENING – Can be uncertain mean flat and then market will look for cues to move further.

MG’s Nifty trading range –

R – 6230 – 6290 – 6350

S – 6020 – 5980- 5935 (Trend Changer level 5950 for Bears and 6350 for Bulls)

ECONOMIC EVENTS / RESULT CALENDAR –

03 Dec 13 – Power Grid OFS

08 Dec 13 – State Assembly Result

OI Activity –

STOCK OUTLOOK -

(Stock that can see some good moves either side)

If market supports then Telecom and OMCs are good bet. Also from Metal sectors TS is one I would like to play.

FRL –

Future Retail was down nearly 7% to Rs73.5 after report said that National Stock Exchange (NSE) decided to remove the stock from future and options (F&O) contract from January 31, 2014 onwards.

MBC PL –

Oct PL = -7400 + 600 (1200 Loss in NMDC, 1600 gain in Nifty PEs) = -7000

Open Call –