Following is the Analysis on Several Indices including Nifty, Bank Nifty, All F&O Stocks, Small Cap& Mid Cap along with VIX & USDINR, Derivatives Outlook.

Mirroring the weak Global Markets on account of concerns of slowing growth, Index witnessed a 3% correction during the course of last week. Fresh economic troubles due to falling crude oil prices has affected various economies dependent on Oil Trade & is spoiling the Global sentiment. Even concerns pertaining to Economic growth in China & Japan coupled with political problems in Euro group countries like Greek is leading to the fragility in Global Markets.

On the domestic front, uncertainty over GST bill, lack of pace of reforms, absence of courage to move ahead similar to the UPA Era has led to fears of the economy slipping back into a paralytic zone.

CNX Nifty (CMP 8224):

 

Post negative opening to the weak on the back of dismal IIP numbers which has come to a 3-year low, Expect Index to retest & find support around 8090-8120 zone & if 8090 holds, Index could witness rebound upto 8360-8410. 

If Index breaks & sustains below 8090, would witness a retest of support zone around 7950-7920 zone. 

 

Technically,

RSI & Stochastic are placed below its averages on daily & weekly charts. Moreover MACD is also placed below its average on daily charts which would lead to selling pressure on rises.

However Stochastic which is placed in oversold zone on daily charts & RSI which is approaching oversold zone would lead to support around 8100-8140 zone.

 

On the derivatives front,

Nifty saw OI addition of 16%, with price moving down by nearly 4% W-o-W basis with maximum OI in 8400-8500 CE (with total 49-71 lakh shares respectively) and 8100-8200 PE (with total 42-43 lakh shares respectively). Implying support 8130-8150.

 

BANKNIFTY (CMP 18300):

Past week, Continued fall in Bond Yields along with fall in Inflation Numbers fuelling hopes of a rate-cut have led to Banking Index holding out compared to weakening in Nifty & selective buying especially in PSU ones were witnessed.

However still Banking Index closed 2.3% cut while closing for the week.

Expect Index to retest & find support around 18100-18150 zone & if 18100 holds, Index could further witness further upside upto 18790-18800. 

If Index breaks & sustains below 18100, would witness a retest of support zone around 17800-17750 zone. 

 

On the derivatives front,

BANKNIFTY saw OI reduction of 5% with price moving down by 2%; 18000 PCR_OI 7.03 and 19000 PCR-OI 0.02, range still same 18000-19000.

 

 

Going forward,

Movement of the Markets would be dictated by impact of dismal IIP Data, WPI data, FII Fund Flows, Global Market Trends, movement of Rupee against the Dollar & crude oil price movement.

On the Global Front, upcoming US FOMC Meet on 16^th & 17^th December would be crucial from the quantitative tightening measures perspective as falling crude prices are beneficial from the US Economic Growth perspective.

The Bank of Japan (BoJ) is scheduled to unveil its credit policy review meet on Friday, 19^th Dec 2014.

 

 

USDINR (CMP 62.47):

Fragility in Global Markets has also led to weakening in USDINR upto 62.50 zone. 

Now Going Forward, Till Rupee holds 61.5 zone, would once again move upto 63.60-63.90 zone.

Below 61.5, would retest 60 zone.

 

BRENT CRUDE ($ 62):

Crude Prices have plunged to multi-year lows on the back of cut in world demand due to slowdown in developed economies.

However it has approached extremely oversold zone & hence if 60 is held, a pullback upto 66-68 cannot be ruled out.

But overall from 66-68 zone, selling pressure would re-emerge.

 

DOW JONES (CMP 17,280):

Dow Jones has corrected 750 points from the peak levels from 17,990 upto 17,280.

Now Going Forward, Expect Dow Jones to find support around 17,140 which is 38.2% retracement of the rally from recent lows of 15,855 (15^th Oct 2014) upto 17,990 (5^th Dec 2014).

Till 17125 - 17140 holds, expect a rebound upto 17,650 zone. Below 17,125 can correct upto 16,800 zone.

 

Midcap: (CMP 12191)

NSE Mid-cap CMP 12,191 witnessed selling pressure at higher levels and cracked 4% for the week.

Going forward, till 12,450 is not crossed, expect the index to witness a correction upto 11,700 zone.

Above 12,450 zone, can witness short covering upto 13,000.   

 

Small Cap (CMP 11,068):

BSE Small-Cap CMP 11,068 witnessed selling pressure at higher levels and cracked 4% for the week.

Going forward, till 11,350 is not crossed, expect the index to witness a correction upto 10,700 zone.

Above 11,350 zone, can witness short covering upto 11,800.   

 

VIX (13.75):

VIX has rebounded from 11 zone upto 13.75 zone. However 14.8-15 is a crucial resistance.

Going forward, till 15 is not crossed, expect Markets to rebound from lower levels.

Above 15 only, VIX could spike upto 18-19 which could lead to correction being intensified from current levels too. 

 

 

 

On the derivatives front,

• FII’s for the past week have stayed net sellers in the cash & derivatives markets while DII’s have also turned Net Sellers for the week gone by.

• On a Weekly basis In Index Futures FIIs were Net Sellers to the tune of ` 956 Cr with an open interest increase of around `2257 Cr which indicates Short Build Up in Index Futures by FIIs.

 

• Nifty Futures have closed at a 52 points premium as against a 37 point premium at the start of the series a week earlier.

 

 

Cumulative FII Derivatives Stats from 28/11/2014 to 12/12/2014:

Index Futures: -2074 Cr;

Index Options: +4538 Cr;

Stock Futures: -3853 Cr;

Stock Options: +125 Cr

 

Cash Market:

FII: +4880 Cr;

DII: -692 Cr.