Nifty saw a superb rally on Friday after a weak start following the US sell-off on Wednesday. The Nifty hit a low of 10924 only to rally 144 points and hit 11068 as smart money covered shorts and value buying emerged across the board. The expectations of stimulus package for the ailing auto sector along with ease in liquidity with banks lending set to pick up and a host of other measures were the cause of Nifty rallying smartly. For today, expect some more color on midcaps as markets sense some Government announcements this week to improve macro and sentiment.
US Market: US indices see strong rally on Friday as oversold conditions see bounce with data indicating recession fears are overdone. Bond yields hit 1.58% as flight to safety sees US yields and gold to be best choice against currency and recession risks. Oil prices see rise in inventories in the US, however prices rebound after growth prospects brighten.
Asian Market: Asian markets saw a quiet start to the week as US/China trade rhetoric, recession fears in Europe and Hong Kong unrest grabbed the headlines. Oversold conditions will see smart money buy stocks as bond yields hit 4 year lows. Asian markets ex-Japan could be relative outperformers as smart money sees favorable risk/reward in stocks as against any other asset class.
FII/DII Data: In yesterday’s trading session FIIs sold 1339 crores worth of stock in cash whereas DIIs bought 1058 crores worth of stock. In the derivative market, FIIs sold 294 crores of Index futures and bought 493 crores worth of Index options. In the Stock futures segment, FIIs sold 491 crores worth of stock futures and sold 76 crores stock options.
FII View: In Index future segment, FIIs index future long/short ratio stood at 0.4x with no major changes in long and short positions. However, on the Index option’s front, they created net buying positions in both call and put options, indicating an expectation of volatility.
|FII||OI(000's)||% Chg||% Chg Since Expiry||Long/Short Ratio||Long/Short Since Expiry|
|Future Index Long||82||2||7||0.4||0.6|
|Future Index Short||212||3||90|
|Option Index Call Long||249||6||103||2.2||0.6|
|Option Index Call Short||114||7||215|
|Option Index Put Long||275||4||65||2.6||1.1|
|Option Index Put Short||106||10||57|