F&O Expiry: Quiet start for Sensex, Nifty
It's been a cracker of a month for Indian indices as the benchmarks rose over 10% in March; a month where FIIs have invested the most for FY16. For the first 11 months of the current fiscal, FIIs were net sellers to the tune of Rs. 35,314.49 crore in equities. Post budget, FIIs pumped in Rs. 19,621.26 crore (US$ 2.237 billion) till March 30. Investors will hope the FII momentum continues into the new fiscal. Corporate earnings will of course drive sentiment later in the coming month but before that we have the RBI policy meet to content with.
The outlook is a flat start as indices may trade in a range before F&O adjustments set in towards the close. Nifty has found strong support at its 100 DMA, which also coincided with the neckline of a bullish head and shoulder pattern and bounced sharply. The current momentum may extend further once the 7750 mark is taken out, beyond which 7972 is likely on the cards. Asian markets are in a range. US indices managed to end higher.
Trading ideas (Time period: 1-3 days)
Asian Paints (BUY, above Rs884, Target Rs910, SL Rs871): Stock is moving in a sustained uptrend taking trend line support on daily and weekly time frame since June 2014. Recently, stock has bounced thrice from its 200-DMA, and managed to move towards the 907-910 levels. In yesterday's trading session stock opened with a gap up with impressive volumes and has seen delivery based buying (64.80%). We advise traders to BUY the stock above Rs884, with target of Rs910, and Stop loss placed at Rs871. (Duration 3 days)
Derivative strategies (Time period: Till expiry)
² Buy Fut INDUSINDBANK April Above Rs947 with SL of 927 for target of 987
Lot size: 600 Remarks: Net maximum profit of Rs24,000 and net maximum loss of Rs12,000
Corporate Snippets
² Kansai Nerolac Paints Limited sold its land admeasuring 15.86 acres at Perungudi, Chennai to SPV formed by Brigade Group and GIC Singapore for a sum of Rs5.5bn. (BS)
² BHEL has commissioned first 250 Mw unit at coal-based Nabinagar thermal power plant of Bhartiya Rail Bijlee Company Ltd in Aurangabad district of Bihar. (BL)
² Defence and security company Saab and Ashok Leyland have joined hands to manufacture truck simulators in India under the Make in India concept. (BS)
² Reliance Capital announced completion of additional 23% stake sale in Reliance Life Insurance to Nippon Life Insurance. (ET)
² Aurobindo Pharma has received final approval from the US health regulator to market its generic antibiotic drug Vancomycin Hydrochloride for Injection, in the American market. (ET)
² Tata Motors signed a memorandum of understanding with the Maharashtra Ex-Servicemen Corporation, for creation of employment opportunities for ex-servicemen of Indian Army. This is in response to Tata Motors solution for the Defence Ministry's prestigious US$10bn combat vehicle programme. (BS)
² ONGC has found hydrocarbon (gas) deposits at Meidum area in Mizoram-Assam border Kolasib district, state Industries Minister said in the state assembly. (BL)
² Suzlon Group has bagged a new turnkey order of 48.30 megawatt (Mw) wind power project from Indian Oil Corporation Ltd. (ET)
² Kalyani Group and Fabbrica D'armi Pietro Beretta, Italy, part of Beretta Defence Technologies (BDT), are in advance level of discussions to form a strategic partnership for providing state-of-the-art small arms for security forces. (BS)
² Marking its entry into the defence sector, the Adani Group has signed a statement of intent with Elbit-ISTAR and Alpha Design Technologies Pvt Ltd to cooperate and work together in the field of Unmanned Aircraft Systems (UAS) in India. (ET)
Economy snippets
² The Asian Development Bank has revised India's growth rate to 7.4% in 2016-17 from 7.6% estimated this year but said India will remain one of the fastest growing economies in the world. (ET)
² Granting long-term relief to domestic steel producers, the central government extended the safeguard duty on the select steel imports for two years. (BS)
² Government and the World Bank today signed a US$1.5bn loan agreement for the Swachh Bharat Mission to support India's universal sanitation initiative. (ET)
² The government came out with a draft bill, Banning of Unregulated Deposit Schemes and Protection of Depositors' Interests Bill 2015, which aims to bring all unregulated deposit schemes under the new law, and has proposed strict penal and monetary provisions for offenders. (BL)
Warm Regards,
Amar Ambani
IIFL
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