MARKET: IT ALL THE WAY TODAY
Both Infosys and TCS pleasantly surprise street
Nifty IT should now be 25% of one’s portfolio
Both TCS and Infosys have made strong bottom
Infosys and TCS nos show that FY25 could be very strong
Today will be a field day for all IT stocks
Nifty IT should soon hit 52-week high
Reliance has joined the party, led the bulls for 2 days
The only missing piece in the puzzle is Bank Nifty
INFOSYS AND TCS: WHAT NEXT?
Both cos beat the topline in seasonally weak quarter
TCS outperformed on margins
Infosys upped lower end of guidance
Attrition has cooled off for both cos, positive for margins
Deal wins remains impressive for both cos
Brokerages expect 12-13% EPS CAGR over next 3 years
If valuations inch up a bit more, both stocks can outperform
TCS: Top takeaways
Rev and margins beat est, stable performance despite weak seasonality of furloughs
CC Rev growth of 1% QOQ vs est of flat
Margins expand for the 2nd consecitve qtr
EBIT % up 70 bps to 25%
Infosys: Top takeaways
Qtr impacted by seasonality and macro but not as bad as feared
CC Rev growth declines 1% vs est of 1.5-2% decline
Deal wins $3.2b vs $7.7b QOO, but largely inline with $3.8bn average for past four quarters.
FY24 Rev guidance narrowed to 1.5-2% vs 1 – 2.5%
FY24 margin guidance maintained at 20-22%
Attrition at 12.9%, down 170bps QoQ
NIFTY OUTLOOK
First resistance zone: 21,700-21,750
Bigger resistance zone: 21,750-21,850
First support zone: 21,550-21,600
All important support zone: 21,450-21,550
Keep stop loss of 21,500 on close for positional longs
Intra-day traders should buy the dips and sell the rallies
Buy zone: 21,600-21,650, stop loss: 21,575
Sell zone: 21,700-21,750, stop loss: 21,764
Chota profit lene ki aadat daalen
BANK NIFTY OUTLOOK
Bank Nifty facing cluster of resistance at 5 and 10 DEMA
5 DEMA at 47,506 and 10 DEMA at 47,655
Bank Nifty protecting falling 20 DEMA of 47,405
Big rally will happen only if Index sustains above 47,655
Sell on rejection of 47,655, stop loss: 47,750
Buy above 47,655, stop loss: day’s low
Both Infosys and TCS pleasantly surprise street
Nifty IT should now be 25% of one’s portfolio
Both TCS and Infosys have made strong bottom
Infosys and TCS nos show that FY25 could be very strong
Today will be a field day for all IT stocks
Nifty IT should soon hit 52-week high
Reliance has joined the party, led the bulls for 2 days
The only missing piece in the puzzle is Bank Nifty
INFOSYS AND TCS: WHAT NEXT?
Both cos beat the topline in seasonally weak quarter
TCS outperformed on margins
Infosys upped lower end of guidance
Attrition has cooled off for both cos, positive for margins
Deal wins remains impressive for both cos
Brokerages expect 12-13% EPS CAGR over next 3 years
If valuations inch up a bit more, both stocks can outperform
TCS: Top takeaways
Rev and margins beat est, stable performance despite weak seasonality of furloughs
CC Rev growth of 1% QOQ vs est of flat
Margins expand for the 2nd consecitve qtr
EBIT % up 70 bps to 25%
Infosys: Top takeaways
Qtr impacted by seasonality and macro but not as bad as feared
CC Rev growth declines 1% vs est of 1.5-2% decline
Deal wins $3.2b vs $7.7b QOO, but largely inline with $3.8bn average for past four quarters.
FY24 Rev guidance narrowed to 1.5-2% vs 1 – 2.5%
FY24 margin guidance maintained at 20-22%
Attrition at 12.9%, down 170bps QoQ
NIFTY OUTLOOK
First resistance zone: 21,700-21,750
Bigger resistance zone: 21,750-21,850
First support zone: 21,550-21,600
All important support zone: 21,450-21,550
Keep stop loss of 21,500 on close for positional longs
Intra-day traders should buy the dips and sell the rallies
Buy zone: 21,600-21,650, stop loss: 21,575
Sell zone: 21,700-21,750, stop loss: 21,764
Chota profit lene ki aadat daalen
BANK NIFTY OUTLOOK
Bank Nifty facing cluster of resistance at 5 and 10 DEMA
5 DEMA at 47,506 and 10 DEMA at 47,655
Bank Nifty protecting falling 20 DEMA of 47,405
Big rally will happen only if Index sustains above 47,655
Sell on rejection of 47,655, stop loss: 47,750
Buy above 47,655, stop loss: day’s low
MARKET: CUES FROM HERE
US 10-year yield back down to 3.95%
Next big cue for market is HDFC Bank nos
HDFC Bank nos tomorrow, Fin nifty expiry tomorrow
HDFC Bank’s quarterly update wasn’t too bad
HDFC Bank has corrected after big rally of December
Reliance, HUL nos on Friday
NIFTY IT: SET FOR MORE GAINS
Wipro ADR up 17%, IT set for more gains today
Nifty IT hit 52-w high but life high still 10% away
Nifty set to test 22,000 today
TRADE SETUP
Nifty PCR at 1.43 vs 1.14
F&O BAN: 15 stocks now in ban period
NIFTY OUTLOOK
22,000 is not the right level to make fresh entry
Big resistance: 22,040-22,100
First support: 21,700-21,800 (Options zone)
Big support: 21,500-21,600 (Recent lows)
BANK NIFTY OUTLOOK
Very important week for Bank Nifty’s trend
Bank Nifty managed to reclaim 20 and 10 DEMA
First resistance: 47,800-48,000 (Options based)
Bigger resistance: 48,400-48,600 (Previous tops)
US 10-year yield back down to 3.95%
Next big cue for market is HDFC Bank nos
HDFC Bank nos tomorrow, Fin nifty expiry tomorrow
HDFC Bank’s quarterly update wasn’t too bad
HDFC Bank has corrected after big rally of December
Reliance, HUL nos on Friday
NIFTY IT: SET FOR MORE GAINS
Wipro ADR up 17%, IT set for more gains today
Nifty IT hit 52-w high but life high still 10% away
Nifty set to test 22,000 today
TRADE SETUP
Nifty PCR at 1.43 vs 1.14
F&O BAN: 15 stocks now in ban period
NIFTY OUTLOOK
22,000 is not the right level to make fresh entry
Big resistance: 22,040-22,100
First support: 21,700-21,800 (Options zone)
Big support: 21,500-21,600 (Recent lows)
BANK NIFTY OUTLOOK
Very important week for Bank Nifty’s trend
Bank Nifty managed to reclaim 20 and 10 DEMA
First resistance: 47,800-48,000 (Options based)
Bigger resistance: 48,400-48,600 (Previous tops)
MARKET: STAY NEAR EXIT DOOR
563 BSE stocks at new high, 16 stocks at new low
Markets top out when new high number is around 600
No harm in missing out the last 5% of the rally
From these levels, risk of capital loss is very high
MARKET: CUES FOR TODAY
The biggest cue today would be HDFC Bank results
HDFC Bank’s quarterly update was strong
Fin Nifty expiry today, Bank Nifty had strong close
Bank Nifty still 500 points away from all-time high
TRADE SETUP
FII in Index Futures
Change in OI Positioning
Longs +10697 66%
Shorts -4379 34%
INDIA VIX closed at 13.79 up 5.22% , Nifty PCR at 1.52 vs 1.43
F&O BAN
16 stocks in F&O ban
NIFTY OUTLOOK
First support zone: 21,950-22,000
Bigger support zone: 21,750-21,900
First resistance: 22,100-22,200
Bigger resistance: 22,250-22,325
BANK NIFTY OUTLOOK
First resistance: 48,250-48,350
Bigger resistance: 48,400-48,600
First support: 47,800-48,000
Bigger support: 47,500-47,700
563 BSE stocks at new high, 16 stocks at new low
Markets top out when new high number is around 600
No harm in missing out the last 5% of the rally
From these levels, risk of capital loss is very high
MARKET: CUES FOR TODAY
The biggest cue today would be HDFC Bank results
HDFC Bank’s quarterly update was strong
Fin Nifty expiry today, Bank Nifty had strong close
Bank Nifty still 500 points away from all-time high
TRADE SETUP
FII in Index Futures
Change in OI Positioning
Longs +10697 66%
Shorts -4379 34%
INDIA VIX closed at 13.79 up 5.22% , Nifty PCR at 1.52 vs 1.43
F&O BAN
16 stocks in F&O ban
NIFTY OUTLOOK
First support zone: 21,950-22,000
Bigger support zone: 21,750-21,900
First resistance: 22,100-22,200
Bigger resistance: 22,250-22,325
BANK NIFTY OUTLOOK
First resistance: 48,250-48,350
Bigger resistance: 48,400-48,600
First support: 47,800-48,000
Bigger support: 47,500-47,700
WHY WAS CAUTION GIVEN YESTERDAY?
Yesterday’s caution and sell call would work today
Now market is “sell on rally” till 22,124 is crossed
Many indicators of markets were in exuberance zone
600 stocks at new highs normally leads to correction
Forward P/E for midcaps is 27.2X , a 39% premium to average - MOSL
Put Call ratio, India VIX and FII long build-up indicated peak
I am not calling for a bear market but just a correction
It will be healthy for Nifty to correct 5% and Midcaps to fall 20%
Investors should use every 200 point dip on Nifty to add to ETFs
HDFC BANK AND BANK NIFTY: WHAT NEXT?
Start with HDFC Bank ADR
Show HDFC Bank 1 month and 3 month chart
Bernstein on HDFC BK
First YoY EPS decline in a decade, sums up a disappointing quarter
Reported a very weak set of numbers
NIMs stayed flat QoQ
Borrowings grew faster than deposits
Bank had use lower tax expense route to maintain 2% RoA
A 2% YoY decline in EPS for a bank famed for its consistent mid-teens EPS growth is a good summary of terrible quarter
Possible to see HDFC Bank revisit 200 DMA of 1533
Long-term investors will be buyers of HDFC Bank around 1550
Valuations would be very appealing at 1550
Unlikely that HDFC Bank will see a big rally for some time
Any investment in HDFC Bank even at 1550 is a faith decision
Bank Nifty at the risk of making a double top at 48,200
TRADE SETUP
Wipro ADR
Nifty IT 1 month chart
DII Net Sell 369 Cr in Cash (10,126.53 - 10,495.82 Cr)
FII Net Buy 657 Cr in Cash (12,212.14 - 11,555.57 Cr)
FII Net Sell 135 Cr in Index Futures
FII Net Sell 1,166 Cr in Stock Futures
FIIs in Index Futures
Longs -1136 66%
Shorts +960 34%
F&O BAN
NEW IN BAN: NATIONALUM, ABFRL, ASHOK LEY
STILL IN BAN: BIOCON, CHAMBALFERT, METROPOLIS, , DELTACORP, POLYCAB, , INDIACEM, , PEL, BANDHANBNK, HINDCOPPER , INDUSTOWER, PVRINOX, ZEEL
OUT OF BAN: BHEL, ESCORTS, SAIL
INDIA VIX closed at 13.57 down 1.81%
Nifty PCR at 1.21 vs 1.52
NIFTY OUTLOOK
Those carrying shorts should exit half at open
For remaining half, keep first 15 min high as stop loss
Highest Put writing at 22,000, premium of Rs 77
Put writer would be in trouble below 21,913
Next support level: 10 DEMA of 21,781
Possible for Nifty to fall to at least 21,781
Buy only on stability above 21,800, stop: 21,750
Any Buy has to be strictly Intra-day with strict SL
January is a month to observe from sidelines
January is not a month for positional trades
BANK NIFTY OUTLOOK
Bank Nifty can fall 1000 points at open today
Show 47,500 Put of today’s expiry
Today will be a lesson on why you should never write naked options
Today’s open will be below 20 DEMA of 47,554 and options base
Next support for Bank Nifty at 50 DEMA of 46,678
No thoughts of buying till any kind of stability emerges
Bank Nifty will be at mercy of fund managers today
If fund managers buy HDFC Bank at lows, recovery may happen
Yesterday’s caution and sell call would work today
Now market is “sell on rally” till 22,124 is crossed
Many indicators of markets were in exuberance zone
600 stocks at new highs normally leads to correction
Forward P/E for midcaps is 27.2X , a 39% premium to average - MOSL
Put Call ratio, India VIX and FII long build-up indicated peak
I am not calling for a bear market but just a correction
It will be healthy for Nifty to correct 5% and Midcaps to fall 20%
Investors should use every 200 point dip on Nifty to add to ETFs
HDFC BANK AND BANK NIFTY: WHAT NEXT?
Start with HDFC Bank ADR
Show HDFC Bank 1 month and 3 month chart
Bernstein on HDFC BK
First YoY EPS decline in a decade, sums up a disappointing quarter
Reported a very weak set of numbers
NIMs stayed flat QoQ
Borrowings grew faster than deposits
Bank had use lower tax expense route to maintain 2% RoA
A 2% YoY decline in EPS for a bank famed for its consistent mid-teens EPS growth is a good summary of terrible quarter
Possible to see HDFC Bank revisit 200 DMA of 1533
Long-term investors will be buyers of HDFC Bank around 1550
Valuations would be very appealing at 1550
Unlikely that HDFC Bank will see a big rally for some time
Any investment in HDFC Bank even at 1550 is a faith decision
Bank Nifty at the risk of making a double top at 48,200
TRADE SETUP
Wipro ADR
Nifty IT 1 month chart
DII Net Sell 369 Cr in Cash (10,126.53 - 10,495.82 Cr)
FII Net Buy 657 Cr in Cash (12,212.14 - 11,555.57 Cr)
FII Net Sell 135 Cr in Index Futures
FII Net Sell 1,166 Cr in Stock Futures
FIIs in Index Futures
Longs -1136 66%
Shorts +960 34%
F&O BAN
NEW IN BAN: NATIONALUM, ABFRL, ASHOK LEY
STILL IN BAN: BIOCON, CHAMBALFERT, METROPOLIS, , DELTACORP, POLYCAB, , INDIACEM, , PEL, BANDHANBNK, HINDCOPPER , INDUSTOWER, PVRINOX, ZEEL
OUT OF BAN: BHEL, ESCORTS, SAIL
INDIA VIX closed at 13.57 down 1.81%
Nifty PCR at 1.21 vs 1.52
NIFTY OUTLOOK
Those carrying shorts should exit half at open
For remaining half, keep first 15 min high as stop loss
Highest Put writing at 22,000, premium of Rs 77
Put writer would be in trouble below 21,913
Next support level: 10 DEMA of 21,781
Possible for Nifty to fall to at least 21,781
Buy only on stability above 21,800, stop: 21,750
Any Buy has to be strictly Intra-day with strict SL
January is a month to observe from sidelines
January is not a month for positional trades
BANK NIFTY OUTLOOK
Bank Nifty can fall 1000 points at open today
Show 47,500 Put of today’s expiry
Today will be a lesson on why you should never write naked options
Today’s open will be below 20 DEMA of 47,554 and options base
Next support for Bank Nifty at 50 DEMA of 46,678
No thoughts of buying till any kind of stability emerges
Bank Nifty will be at mercy of fund managers today
If fund managers buy HDFC Bank at lows, recovery may happen
BANK NIFTY: SUPPORT OF INDUSIND
IndusInd Bank soothes nerves with decent NIMs
Market’s big fear was all banks will show poor NIMs
One leg of correction might be over in Bank Nifty
Bank Nifty closed at 100 DEMA yesterday
Bank Nifty also trading at 20 Week EMA
Logical target for Bank Nifty in next correction: 44,500
44,500 is the 200 day Simple moving average
MARKET: WHAT NEXT?
Focus on cos delivering good results
Market is rewarding good nos, yesterday Oracle surged 30%
Yesterday’s low is now sacrosanct for Nifty
Markets normally always test panic low to check strength
Over next few days, Nifty is likely to test 21,285 again
TRADE SETUP
FII Long Exposure in Index Futures
% Net Contracts
Series Start 70% +81650
Jan 16 66% +79600
Jan 17 54% +20650
Jan 18 49% -4650
IndusInd Bank soothes nerves with decent NIMs
Market’s big fear was all banks will show poor NIMs
One leg of correction might be over in Bank Nifty
Bank Nifty closed at 100 DEMA yesterday
Bank Nifty also trading at 20 Week EMA
Logical target for Bank Nifty in next correction: 44,500
44,500 is the 200 day Simple moving average
MARKET: WHAT NEXT?
Focus on cos delivering good results
Market is rewarding good nos, yesterday Oracle surged 30%
Yesterday’s low is now sacrosanct for Nifty
Markets normally always test panic low to check strength
Over next few days, Nifty is likely to test 21,285 again
TRADE SETUP
FII Long Exposure in Index Futures
% Net Contracts
Series Start 70% +81650
Jan 16 66% +79600
Jan 17 54% +20650
Jan 18 49% -4650