Market Mantra: The Money Daily – December 29, 2015

Market Mantra

 

Delight at start! Difficulties may set in for indices later

 

With just few trading sessions remaining in the current year, the top 20 leading stock index on a global front are set to end CY2015 on a mixed note. 11 out of 20 global stock indices are currently trading in negative terrain. Eight benchmark indices are offering positive returns and the US-based S&P 500 index is almost flat in CY2015.

 

The outlook is a positive start. With indices at their highest level in more than three weeks, the market could turn choppy later in the day depending on global cues and F&O adjustments. Rollovers on Index for December expiry stood at 29% on D-3 days. Heavy discount on index futures was seen during the day to the tune of 15-18 points, indicating large cash-based buying in index heavyweights. India VIX soared 5% during the day with major build ups in 8000 calls and 7800 puts, which indicates broader trading range for December expiry.

 

 

Trading ideas (Time period: 1-3 days)

 

SRF (BUY, above Rs1,275, Target Rs1,315, SL Rs1,255): Every trend requires to go through a correction and SRF got that correction in last two months. Infact, it retraced 61.8% of its earlier upmove, which took place in August 2015. On the daily chart, the stock was consolidating Rs1,200- 1,250 in last few trading sessions. In yesterday’s trade, it attempted a breakout from this consolidation. Also, Heiken Ashi candles have resumed the uptrend after a doji candle. (Duration 5 days)

 

Derivative strategies (Time period: Till expiry)

 

²  Short Strangle Nifty Dec series Sell 7900 Call & Put with combined premium of 68-70  for target  on spread of 10 with SL on spread 100

Lot size: 75

Remarks: Net maximum profit of Rs4,500 and net maximum loss of Rs2,250.

 

Corporate Snippets

 

²  IOC gets regulator’s nod for Ennore LNG pipeline (BL)

²  Blackstone, Birla Corp and Baring Private Equity Asia are in the final race to acquire the cement business of Anil Ambani’s Reliance Infrastructure (ET)

²  ITC Rejigs Top Deck in Hotel Business For Smooth Succession (ET)

²  Reliance Jio sets a target of 100 million users in first year (BL)

²  Hyderabad to host Infosys’ biggest campus (BL)

²  IOCBPCL, and HPCL might jointly set up a mega refinery at Ratnagiri in coastal Maharashtra (BS)

²  SpiceJet to Offer Discounts on Domestic Routes (ET)

²  Srikalahasthi Pipes bags Rs. 1,053 cr worth orders (BL)

²  PVR Cinemas to add 67 screens (BL)

²  Sterlite Grid has won the Rs 2,596 crore ‘Common Transmission System (II)’ Project for generation projects in Odisha (BS)

 

Economy snippets

 

²  Coming soon an independent regulator for the Indian Railways that will be empowered to set fares (ET)

²  Subsidised cooking gas will no longer be provided to buyers earning Rs. 10lakh or more a year (ET)

²  Budget to project pro-reform image even as GST roll-out is in limbo (BL)

²  The Centre has given its clearance for four greenfield airports – three in Andhra Pradesh and an international airport at Dholera in Gujarat (BL)

²  Union Civil Aviation Minister Ashok Gajapathi Raju has said the new civil aviation policy is in the final stage of approval and will be announced by early next year (BL)

²  Taxpayers with annual income more than Rs 10 lakh will not get subsidised cooking gas (LPG) from next month (BS)

²  The Centre is hopeful of getting at least 21 states on board for Ujwal Discom Assurance Yojana (UDAY) reforms for state-owned power distribution companies before March 2016 (BS)

²  New-look Indira Awaas Yojana to Get New Name (ET)

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