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ISSUE: 012

24TH NOVEMBER, 2018

RULE THE MARKET

From The Desk Of Research HeadCONTENTSEquity 1-6

Derivatives 7-8

Commodity 9-12

Currency 13-15

Events 16

TeamDr Ravi Singh

Arun Kumar Mantri

Aditya Kistampally

Deepak Sakure

M V Narasinga Rao

Naga Chaitanya

Osho Krishan

Srinivas Krishnan Bobba

Vivek K

Vivek Ranjan Misra

Ankit Soni

Jayasree Ram

Munindra Upadhyaya

Yash Bhutika

Veeresh Hiremath

Arpit Chandna

Ravi Pandey

Anup. B.P

Ramesh Chenchala

Rahul Chander

Amit Kumar

Vinod Jayakumar

Siddhesh Ghare

Bharath Sunnam

Karvy Head Office

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Compensation of KSBL’s Research Analyst(s) is not based on any specific merchant banking, investment banking or brokerage service transactions. KSBL generally prohibits its analysts, persons reporting to analysts and their relatives from maintaining a financial interest in the securities or derivatives of any companies that the analysts cover.KSBL or its associates collectively or Research Analysts do not own 1% or more of the equity securities of the Company mentioned in the report as of the last day of the month preceding the publication of the research report. KSBL or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report and have no financial interest in the subject company mentioned in this report. Accordingly, neither KSBL nor Research Analysts have any material conflict of interest at the time of publication of this report. 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INDIA’S CURRENCY SWAP AGREEMENT WITH JAPAN; A RELIEF TO THE INDIAN RUPEE.

The bilateral currency swap agreement with Japan might be an important initiative taken by the

government of India to support the depreciating rupee. The rupee’s incessant slide against the USD

during the calendar year had kept the central bank and Indian government on toes. However, the

RBI limited its support to its intervention within the exchange market which resulted in depleting the

exchange reserves by $33 billion within the last six months. Recently RBI’s unwillingness to take strong

measures to contain the rupee fall had given rise to extreme speculation on the rupee’s movement.

However, the measures taken by the center like easing norms for external commercial borrowings

(ECBs) and masala bonds while imposing additional taxes on non-essential imports haven’t shown any

major impact on stopping the rupee’s further fall.

WHAT IS THIS CURRENCY SWAP IN THE FIRST PLACE?

In a currency swap, a country exchanges its national currency with that of another country’s national

currency or with a different one. In the current agreement, India can acquire either Japan’s Yen or US

dollars from Japan up to a threshold of 75billion dollars in exchange for INR. This transaction has to be

reversed after an agreed period.

WHY THIS CURRENCY SWAP WITH JAPAN NOW?

The currency swap agreement made with Japan was bilateral in nature and was made at 75

billion dollars in value which might bring a positive impact for the rupee. This will give RBI

enough room to encounter the unexpected or unforeseen volatile movements in the Indian

currency. Since the rate of exchange is determined within the swap deal, the exchange risk is

eased. Additionally, the cost of finance is lower since the interest is charged solely on the quantity

drawn through the swap. Even though this is not the first of its deal with Japan for currency swap,

this facility has not been fully utilized within the past and is unlikely to be exhausted this year too.

However, such deals may discourage the speculators to be over-reactive.

WHAT ELSE COULD BE DONE?

If we see the recent trends, the navigation of the Indian currency is closely dependant on the crude

oil prices. As the crude oil prices slightly stabilized recently, the rupee cooled off towards 72 marks

against the USD. However, the relief might be temporary given the on-going trade wars between the

US and China. In such a state of affairs, Indian importers will be in a tight spot. Also, it could get more

difficult for firms with intensive overseas borrowings to repay their loans. Hence, the government

should continue its efforts to avert the rupee slide. It should make such currency swap liaisoning with

other strong trading partners to make the trade settlements in local currencies. The policy rate is

another such tool that the RBI may use to prevent the fund outflows from Indian debt instruments.

- DR. RAVI SINGHHead-Technical & Derivatives Research

EQUITY

Economy

• The investigation arm of the Finance Ministry has detected tax evasion worth Rs. 290.88bn in 1,835 cases during the April-October period.

• The mudra loan scheme launched three years ago for MSME loans has surprised withlower GNPA ratios. GNPA for the total industry has crossed 10% in 2017-18.

• The government is considering taking away the power of the National Company LawTribunal to approve or reject mergers and acquisitions, and give the responsibility toregional directors of the Ministry of Corporate Affairs.

• The finance ministry plans to present a full budget on 1 February, a senior governmentofficial said.

Automobile:

• CRISIL has scaled down its sales growth guidance for passenger cars in India by 200basis points to 7-9% on account of lackluster demand in the festival season.

• Nissan Motor Co.’s board members were divided on voting whether to dismiss CarlosGhosn as chairman, saying they have been given too little detail on his alleged financialcrimes, according to people familiar with the matter.

BFSI:

• The RBI’s decision to extend the timeline for the implementation of the capital conservation buffer norm by a year to March 2020 could reduce banks’ capital requirements by around Rs. 350 bn for the current fiscal, government officials said.

• Reliance Nippon Asset Management Company proposes to raise up to Rs. 8000 crfrom Further Fund Offer 3 (FFO3) of its central public sector enterprises-exchange traded fund (CPSE ETF).

Pharma:

• Lupin Ltd. launched tetrabenazine tablets, a generic version of Valeant Pharmaceuticals North America LLC’s Xenazine tablets, in the US.

• A US court has allowed Dr. Reddy’s Laboratories to sell a generic version of the UK-based Indivior opioid treatment Suboxone sublingual film.

FMCG:

• Manufacturers of refrigerators, washing machines and air conditioners are set tolaunch a Make in India thrust, mirroring those in Smartphone’s and televisions after the government raised import duties. Investments more than Rs. 65 bn in the white goods sector have already been lined up for the next two years, with more in the pipeline, theindustry said.

Aviation:

• Sanjay Kumar, an aviation industry veteran who played a key role in shaping operations at low-fare carriers INTERGLOBE AVIATION and SPICEJET from the ground up, will join Air Asia India as its Chief Operating Officer.

• Civil Aviation Minister, Jayant Sinha said that the process of getting air turbine fuel under GST bracket is underway and the government is committed to providing airlines with a positive and supportive policy environment so that they can flourish and succeed.

Railway

• Reliance Jio Infocomm will serve the country’s largest and most sought-after accounts in telecom and railways from 1st January, with officials saying it is likely to slash the national transporter’s phone bills by at least 35%.

Oil and gas

• The government has put up 50 geographical areas for bidding of city gas distribution licenses and the round is expected to see intense competition with previous players looking to consolidate their position in the sector.

• India’s crude oil imports in October rose to the highest level in at least more than seven years, data from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry showed.

NEWS

INTERNATIONAL NEWS

• According to analysts, Chinese individuals are financially healthy; many are holding off on spending due to uncertainty about the future. Retail sales fell to a disappointing 8.6% in October.

• Auto sales in the world’s largest market for cars have fallen more than 11.5% in the last two months, turning year to date growth negative for the first time in more than six years.

• Singapore’s economic growth grew 2.2% in the third quarter as compared to last year, slower than the advance estimate of 2.6% growth.

• The Organisation for Economic Cooperation and Development forecasts that global growth would slow from 3.7% this year to 3.5% in 2019 and 2020. It had previously projected 3.7%for 2019.

• The UK PM Theresa May said that the future relationship is not ready in time, the choice is either the backstop, extension of implementation period or alternative arrangements, wants to ensure a good trading relationship with the EU and added they are seeking a deal which must work for Gibraltar.

TREND SHEETSymbol CMP S2 S1 R1 R2 TREND

SENSEX 34981.02 34365 34673 35554 36127 Up

NIFTY 10526.75 10342 10434 10697 10867 Up

NIFTYBANK 25999.45 25678 25839 26270 26540 Up

YESBANK 195.55 183 189 204 212 Down

RELIANCE 1,102.85 1064 1083 1139 1175 Up

IBULHSGFIN 705.70 643 674 756 807 Down

ICICIBANK 352.05 338 345 365 378 Up

INFY 620.75 582 601 651 682 Down

MARUTI 7,411.10 7204 7307 7497 7584 Up

HDFCBANK 2,005.50 1977 1991 2027 2049 Up

AXISBANK 614.55 597 606 626 638 UP

TCS 1,812.55 1731 1772 1880 1948 Down

DRREDDY 2,608.70 2350 2479 2697 2785 Up

FORTHCOMING EVENTSCompany name Result Date Company name

KAVERI SEED COMPANY LTD. 26-NOV-18INTERIM DIVIDEND -

RS. - 3.0

RAIN INDUSTRIES LTD 26-NOV-18INTERIM DIVIDEND -

RS. - 1.0

SADBHAV INFRASTRUCTURE PROJECT LTD.

26-NOV-18INTERIM DIVIDEND -

RS. - 0.2

GALLANTT ISPAT LTD. 27-NOV-18INTERIM DIVIDEND -

RS. - .05

POLYPLEX CORPORATION LTD. 27-NOV-18INTERIM DIVIDEND -

RS. - 10

INDAG RUBBER LTD. 29-NOV-18INTERIM DIVIDEND -

RS. - 0.9

JAMNA AUTO INDUSTRIES LTD. 29-NOV-18INTERIM DIVIDEND -

RS. - 0.5

SANDUR MANGANESE & IRON ORES LTD. 29-NOV-18INTERIM DIVIDEND -

RS. - 3.5

KSTREET - 24TH NOVEMBER 2018 1

INDIAN INDICES (% CHANGE)

GLOBAL INDICES (% CHANGE)

NIFTY MIDCAP100TOP GAINERS & LOSERS (1W)

SECTORAL INDICES (% CHANGE)

FII/FPI & DII TRADING (IN RS. CRORES)

NSE NIFTY TOP GAINERS & LOSERS (1W)

EQUITY

-1.60

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BEAT THE STREET - FUNDAMENTAL ANALYSIS

Finolex cables CMP Rs.462Target Price Rs.600Upside 30%

Investment Rationale

• Finolex is the flagship company of Finolex group. Over the years, it has become a leading cable manufacturer in India.

• The company is the leader in electrical cables and has a firm footing in the south.

• The company also forayed into consumer durables segment with products like fans, switchgear and water heater.

• Electrical cables segment has been the major growth driver for the company, contributing around 80% of total revenues. The volumes of electrical cables had a setback due to transport issues at Roorkee and floods in Kerala. But with changing situation in Kerala, volumes are expected to recover the bank in H2FY19.

• Communication cables to be the next growth driver as OFC cables are registering a growth of 25-30%. The OFC contributes around 70% of total communication cables revenue.

• Finolex entered into consumer durables segment last year. We expect the strong distribution channel to help the consumer products gain traction in the market.

• The cables & wire industry has been consistently growing at a CAGR of 12-15% for the past five years. The government policies like Pradhan Mantri Awas Yojana (PMAY) and Deen Dayal Upadhayay Gram Jyoti Yoajan (DDUGYJ) are expected to support the industry growth.

VALUE PARAMETERSFace Value (Rs.) 2.0

52 Week High/Low (Rs.) 758/450

M.Cap (Rs. Bn/US $mn) 70.7/0.99

EPS (Rs.) 23.4

P/E Ratio (times) (FY20E) 17.3

Dividend Yield (%) 1.0

Stock Exchange BSE

% OF SHARE HOLDING

in Rs.Mn ACTUAL ESTIMATE

YE Mar FY 17 FY 18 FY 19

Net Income 28842 32361 36047

EBITDA 4223 4854 5407

EBITDA Margin(%) 14.6 15.0 15.0

Net profit 3583 3711 4170

EPS(Rs) 23.4 24.3 27.3

RoE(%) 16.3 15.9 15.6

PE(x) 27.7 19.4 17.3

P/E CHART

Valuation

At CMP of Rs. 472, FCL is trading at 17.3 x to FY20E EPS. FCL is expected to generate healthy cash flows over time. We recommend Buy valuing the company at 22.3x (3years average) on FY20E EPS for a target price of Rs. 600.

EQUITY


BEAT THE STREET - FUNDAMENTAL ANALYSIS

Mahindra & MahindraCMP Rs.745Target Price Rs.936Upside 25.6%

Company Background

Mahindra and Mahindra (M&M) is an automobile manufacturer having core expertise in tractors, commercial vehicles and passenger vehicles. It was established in the year 1945 and is headquartered at Mumbai.

Investment Rationale

• M&M’s earnings growth and stock performance will be directly influenced by the success of its new launches in UV segment. We believe that the growth outlook for the tractor industry in FY20 remains uncertain due to the unpredictable monsoons. At the same time, in the UV segment, M&M’s core product portfolio is showing signs of maturity. Nevertheless, we expect some traction from the new launches lined up in the upcoming quarters.

• During Q2FY19, the company reported sales volume of 150,545 vehicles in its automotive division, an increase of 9.5% YoY. Revenue from Automotive division reported Rs. 84.5 bn, up by 8.5%. However, the company took a hit on the EBITDA margin by 154 bps YoY to 14.5% on account of increasing raw material prices, higher advertising and marketing expenses associated with its auto division. We expect these cost pressure to continue for a short-term period.

VALUE PARAMETERSFace Value (Rs.) 10.0

52 Week High/Low (Rs.) 840/416

M.Cap (Rs. Bn/US $mn) 7.2/0.9

EPS (Rs.) 41.9

P/E Ratio (times) (FY20E) 9.3

Dividend Yield (%) 0.4

Stock Exchange NSE/BSE

ValuationWe expect M&M’s overall volumes, sales and PAT to grow at a CAGR of 10.7%, 13.1% and 14.8%, respectively over FY18-20E. Based on its core earnings, M&M stock is currently trading at 9.8xFY20E core earnings. The stock remains one of the most inexpensive stocks amongst large-cap auto companies in India. We have also factored in the uncertainty in its tractor business growth in FY20 and benign response to its new UV launch. We value M&M at PER of 14xFY20 core EPS + Rs. 301 subsidiary valuations for a target price of Rs. 936.

EQUITY

P/E CHART

% OF SHARE HOLDING

in Rs.Mn ACTUAL ESTIMATE

YE Mar FY 17 FY 18 FY 19 FY 20

REVENUE 414 476 544 609

EBITDA 54 70 82 92

EBITDA(%) 13.1 14.8 15.1 15.1

PAT 34 42 50 55

EPS (Rs.) 27 34 41 45

RoE (%) 13.4 14.5 15.3 15.1

P/E 16.4 13.1 10.8 9.8


EQUITY

BEAT THE STREET - TECHNICAL ANALYSIS

Himadri Speciality Chemical Ltd

HSCL has rallied from 12.2 levels in December 2015 to 196.8 levels in January 2018 and corrected from there to 106 levels, which is around 50% Fibonacci retracement level of the said rally and bounced back to close above 38.2% retracement levels of the said rally, indicating the end of the correction. The stock has given A breakout from falling trend line in the daily chart, indicating a fresh leg of rally from these levels. Adding to it, the Parabolic SAR and Heiken candlesticks are signaling a positive trend on the weekly charts, reflecting the stock is well placed to move higher in the coming days. 14 periods RSI is trading above the 9 period averages in the weekly charts, indicating positive momentum. The stock is trading well above all of its major moving averages on the daily as well as weekly charts, indicating a strong positive momentum in the counter for all major time frames. On Bollinger band weekly chart, the stock has tested the upper bands and the bands are expanding, indicating positive momentum. At the current levels, the stock has given an excellent opportunity for medium to long-term investors to accumulate the stock around 135 levels for the potential upside targets of 181-195 levels over the next 6-9 months, keeping a stop loss below 104 levels.

Apollo Hospitals Enterprise Limited

APOLLOHOSP has rallied from 792 levels in August 2013 to 1527 levels in March 2016 and corrected from there to 907 levels on closing basis, which is around 78.40% Fibonacci retracement level of the said rally and bounced back to test 38.2% retracement levels of the said rally, indicating the end of the correction. The stock has given breakout from falling trend line in the monthly chart, indicating a fresh leg of rally from these levels. Adding to it, the Parabolic SAR and Heiken candlesticks suggest a positive trend in the counter on the weekly charts. 14 periods RSI is trading at 60.26 above the 9 period averages trading at 56.27 in the weekly chart, indicating positive momentum. The stock is trading well above all of its major moving averages on daily as well as weekly charts, indicating strong positive momentum in the counter for all major time frames. On Bollinger bands weekly chart, the stock has tested the upper bands and the bands are expanding, indicating positive momentum. At the current levels, the stock has given an excellent opportunity for medium to long-term investors to accumulate the stock around 1200 levels for the potential upside targets of 1515-1620 levels over the next 6-9 months, keeping a stop loss below 990 levels.

Stock HSCL

CMP 138.1

Action BUY

Entry 135

Average 115

Stop loss 104

Target 181

Target 2 195

Time Frame 6-9 Months

Stock APOLLOHOSP

CMP 1214.25

Action BUY

Entry 1200

Average 1025

Stop loss 990

Target 1515

Target 2 1620

Time Frame 6-9 Months


EQUITY

Sentiment

Stop Loss 269

Target 240

Lot Size 2200

Margin 92000

21-DEMA 266

Open Interest Shares 26279000

Change in OI 1909600

Cost of Carry (%) -4.98

SECTORAL SNIPPETS

NIFTY REALTY (226.55) outperformed Nifty 50 index on the weekly basis and ended the week in green by generating positive returns over 1.70%, which was majorly due to the rise in high weightage counters like DLF, OBEROIRLTY, GODREJPROP, PHOENIXLL, IBREALEST, SUNTEK and BRIGADE which rose approximately 5%, 3%, 3.30%, 3.70%, 0.10%, 0.50% and 3.80%, respectively. However, there were counters like PRESTIGE and UNITECH which ended the week on a negative note with approximately 3.60%, and 4.40%, respectively. Technically, the index has seen a relief rally in the starting of the week taking base support of 218-220 levels. Average traded volumes backed all the gains, even the week was having only 4 trading sessions indicating resistance in the counter at higher levels around 230-231 due of lack of participants. The support zone of 218-220 levels played a crucial role and carried the trend for the index after consolidating. On the daily charts, the counter is placed above its short-term moving average (21 and 50 DEMA) and the upside may be expected near to the recent swing high placed around 232 levels, which would play a crucial role for resisting the index followed by 238-240 levels. On the weekly chart, 14 periods RSI has witnessed reversal from its oversold zone suggesting near-term positive strength in the counter. The immediate support for the index is placed around 216-218 levels followed by 210 levels, while on the contrary the resistance is pegged around 238-240 levels followed by 244-245 levels, which is its 100 DEMA. For the coming week, stock specific action can be seen and it is advisable to trade cautiously in the counter and to look for stock specific action.

NIFTYBANK (25,999.45) outperformed Nifty with a loss of 0.94% during the week passed by, while the broader index Nifty lost by 1.46%. The index turned volatile during the truncated week and saw a continuous decline throughout the week. However, the index closed above the crucial support above 25,900 levels below which the index may see further selling. Considering the mentioned support for the index at 25,900 levels, market participants may stay long with until 25,900 levels are breached. On the stock specific front, IDFCBANK and YESBANK gained 6.31% and 2.43% during the week, while BANKBARODA, ICICIBANK, SBIN and PNB lost between 4.69% to 2.25%. On the news front, Indian Banks may get a reprieve of about Rs 13,400 crore in the capital exemption, as announced by the Reserve Bank of India board on Monday. The biggest beneficiary of this would be the government because the RBI decision would lessen the burden on it to bridge a capital shortage for several state-run banks. Yes Bank said its board will meet on 13 December to consider the appointment of a new chairman, two independent directors are expected to replace departing directors, and the CEO search panel’s recommendation to appoint a successor to the current MD and CEO Rana Kapoor. Technically, BankNifty may face crucial resistance at 26,500 and 26,800 levels. For the week ahead, support for the index can be pegged at 25,900 levels followed by 25,600 levels. On the momentum setup, 60-period weekly CCI is plotting above its zero line, indicating an underlying bullishness in the index. However, we may expect a subdued movement in the index if it falls below the 25,900 levels.

NIFTYFMCG (29,244.10) ended on a flat note for the truncated week. The index has shut shop at 29,244 and has gained around 0.30% for the week. This sectoral index has outperformed the broader market, where Nifty ended the week on a negative note. The breadth of the index is mixed with 8 stocks ending in the negative zone, while rest of the stocks have ended in the positive zone. Major stocks which ended in green are ITC, Britannia, Jubilant food works, Colgate Palmolive, Godrej industries, Dabur and Maric, while major stocks which ended in red are Mc Dowell, Emami Ltd, Hindustan Uni Lever, Tata Global, Godrej Consumer Products, Gsk Consumers, PGHH and United Breweries Limited. For now, the index is trading in an uptrend which can be evidenced by its sustenance above its major short-term moving averages and is getting support from its 13days moving averages. On the MACD front, the index is having a positive crossover and is placed near its neutral line, on the other hand, RSI is pegged at around 54 and is on the verge of a negative crossover on the daily charts. On the volatility front, the index is currently placed near its upper band on the Bollinger band set up, the bands are widening, indicating the increasing volatility in the index. Hence going forward, the index has major support at 29,000 and below it at 28,500 levels, while resistance is placed around 29,750 and above it at 30,100 levels. Hence for the week, we expect the index to trade in the range of 28,750 to 29,850 with a positive bias, while more volatile moves are likely.

NIFTYPHARM (9302.30) closed the week on a flat note ending at 9297.45 levels, outperforming its benchmark index NIFTY which closed with a negative return of more than 1.5% during the last week. The major gainers from the Pharma index were DRREDDY, AUROPHARMA and SUNPHARMA, while other pharma stocks like PEL, CIPLA, GLENMARK, LUPIN and CIPLA closed in red. Technically, the index is trading below its 21/50/100/200 DEMA on the daily chart, suggesting underlying weakness in the stock. On the technical indicator front, the 14-period RSI is trading below its 9-day signal line on the daily chart and poised with weak bias, suggesting weakness in the index in near term. The MACD is also trading below the signal line on the daily charts, indicating weakness is likely to continue in the index in near term as well. The immediate support for NIFTYPHARM is pegged around 9,150-9,100 followed by 9,000 levels, while on the higher side, the index may face resistance around 9,350-9,400 levels followed by 9,500 levels. Going forward, we are expecting the index to trade with sideways to negative bias in the coming week. The stock-specific action is expected to be seen in the sector during the next week.

BHARAT EARTH MOVERS LIMITED: BUY BEML (DEC FUTURE) | CMP: 752.80 SECTOR: CG

BEML has been consolidating within a “Pole and Flag” chart pattern, as seen on the stock’s daily charts with decent price volume activity, indicating that every decline is being bought into. The stock has also closed at its highest level in as many as 9 weeks, which is a positive sign in itself. BEML has just given a golden crossover with the 21 Day Exponential Moving Average (695.07) cutting the 50 Day Exponential Moving Average (691.37) from below, indicating good immediate supports thereabout. From the past few trading sessions, the stock is trading in a range of Rs. 745 - Rs. 770 (immediate resistance), therefore, if the stock manages to cross and sustain above the Rs. 770 mark, it will trigger a fresh round of buying in the counter. As far as the technical parameters of the stock on weekly charts are concerned, the RSI (46.35) is trading above the RSI Avg. at 37.59, indicating good room for the stock to outperform over the next one week or so. Hence, we recommend smart traders to go long as per the levels mentioned above.

Sentiment

Stop Loss 719

Target 835

Lot Size 500

Margin 63600

21-DEMA 695

Open Interest Shares 1373000

Change in OI -132500

Cost of Carry (%) 7.64

COAL INDIA LIMITED: SELL COALINDIA (DEC FUTURE) | CMP: 254.05 SECTOR: METALS

COALINDIA has lost nearly 2.6% for the week. The stock is consistently trading below all the major moving averages on the daily chart. The stock is consistently trading below all the major moving averages on the daily chart. The stock has fallen for the second consecutive week, indicating bears maintaining their grip in this counter, further indicating selling pressure likely continues in the coming trading sessions. On the momentum oscillator front, the 14 period RSI is placed below the signal line on the daily as well as the weekly chart, reaffirming the negative view in this counter. Hence, we suggest smart traders to short this counter on bounce towards 257 levels for the target of 240 levels with a stop loss placed above 269 levels.


WEEKLY VIEW OF THE MARKET

NIFTY (10,526.75): Nifty, after witnessing a consolidation breakout in the previous week, retraced lower during the last week by losing 1.46%. The downside occurred after the index witnessed the swing as well as gap resistance at 10,775 levels. This hurdle zone was also in confluence with the crucial 50 days EMA at 10,670 levels and 38.2% Fibonacci retracement for the down move of 11,760 levels to the recent swing low of 10,030 levels. This indicates that the above resistance zone might act as strong resistance in the short run ahead.

The current weakness in Nifty, which also closed below the 13 days EMA, may indicate that the weakness in the index is likely to persist for some more days ahead unless the resistance at 10,775 levels is confidently taken out from the downside. For the week ahead to note, market participants may stay cautious amid the ongoing state elections which are likely to act as a stage rehearsal for the upcoming General election in May 2019.

On the data front, GDP data for Q2 FY18-19 is set to release on Friday, 30th November post market hours which may set the tone for the short-term direction in the markets. However, the index may trade volatile given the November series derivatives expiry during the week. On the derivatives front, open interest data suggests that the index is likely to trade in the range of 10,200 to 10,700 levels during the week as the index witnessed highest OI writing at these levels.

DERIVATIVE STRATEGIES

Type: Covered Call in NIFTY

First leg Buy one lot of NIFTY DEC FUT @ 10565

Second leg Sell one lot of NIFTY DEC 10700 CE @ 150

Max Profit 21,375 (Cumulative premium: 65)

BEP 10,415

Max Loss Unlimited beyond BEP

Stop loss 10375 (Spot levels)

Rationale The index is expected to take support around 10,475-10,500 levels and move higher towards 10,700 levels in the near term.

DERIVATIVES

Type: BULL CALL RATIO in ADANIPORTS

First leg Buy one lot of ADANIPORTS 29 Nov 360 CE @ 9.50

Second leg Sell two lots of ADANIPORTS 29 Nov 370 CE @ 4.00

BEP Lower BEP : 361.50 Upper BEP : 378.50

Max Profit 21250

Max Loss 3750 Below LBEP, Unlimited Above UBEP

Rationale The stock is in short term uptrend and the momentum is also very strong and likely to move towards 375-380 zones in near term.

Type: BEAR PUT in PFC

First leg Buy one lot of PFC 29 NOV 100 PE @ 2.00

Second leg Sell one lot of PFC 29 NOV 95 PE @ 0.55

BEP 98.55

Max Profit 21300

Max Loss 8700

Rationale The stock has given breakdown from a head and shoulders pattern on the daily charts with huge volumes and derivative activity. Hence, bearish view for near term.

Type: Bull Call in BANKNIFTY

First leg Buy one lot of BANKNIFTY 29NOV 26100 CE @ 145

Second leg Sell one lot of BANKNIFTY 29NOV 26200 CE @ 110

BEP 26135

Max Profit 1,300

Max Loss 700

Stop loss 25750 (Spot levels)

Rationale The index is expected to trade with bullish bias and may test 26,200 plus levels in the near term period.

7KSTREET - 24TH NOVEMBER 2018

DERIVATIVES

FII ACTIVITY IN INDEX FUTURES FII ACTIVITY IN STOCK FUTURES

TOP 6 LONG BUILD UP

Stock Name LTP % Price Change Open Int % OI Change

DALMIABHA 2384.7 5.35 797400 86.13

OIL 205.15 2.99 4836777 42.30

FEDERALBNK 80.7 1.00 52743000 20.80

RAMCOCEM 619.95 0.10 850400 17.72

MRF 67607.4 2.82 28180 15.82

ALBK 45.15 4.15 21786000 14.38

BANKNIFTY OPTION OI CONCENTRATION (WEEKLY) CHANGE IN BANKNIFTY OPTION OI (WEEKLY)

TOP 6 SHORT CLOSURE


CHOLAFIN 1309.15 4.27 618000 -15.69

COLPAL 1148.4 0.07 1518300 -15.64

SRF 2078.5 1.87 556500 -13.85

EXIDEIND 250.75 1.79 6872000 -13.36

ARVIND 320.25 0.39 7810000 -12.99

DABUR 400.8 1.30 11833750 -12.06

TOP 6 SHORT BUILD UP


IOC 138.25 -3.56 40536000 45.02

SIEMENS 917.25 -6.54 2849000 40.72

ACC 1456.50 -2.99 1258800 37.54

AMARAJABAT 715.65 -2.47 1533700 26.50

INFIBEAM 46.85 -0.53 16076000 24.54

NTPC 146 -5.23 41664000 23.63

TOP 6 LONG CLOSURE


HCC 11.60 -16.85 16933172 -26.10

UBL 1301.20 -1.09 1897700 -13.63

DIVISLAB 1529.30 -1.89 2554000 -12.38

BANKINDIA 86.00 -2.44 25284000 -11.60

OFSS 3431.65 -3.97 186900 -9.45

GRANULES 93.30 -7.39 10640000 -8.75

NIFTY OPTION OI CONCENTRATION CHANGE IN NIFTY OPTION OI


COMMODITIES

BULLIONGlobal bullion market has witnessed a roller coaster ride during the week ended on 23rd November 2018, wherein both gold and silver futures on COMEX moved up and down. The market was cautious during the week ahead of G20 meeting at the end of November month in Argentina. During the G20 meeting, the US and China are expected to initiated trade talks to end the ongoing trade tussle between them. COMEX gold futures for December delivery traded in the range of $1218.50 - $1230.90 per troy ounce, while silver futures for the same expiry traded in the range of $14.165 - $14.540 per troy ounce. During the week, major economic releases from the US were from the housing market, which had a mixed impact on the bullion market. The dollar index, which measures the strength of the dollar against six major currencies, was steady during the week. On the domestic front, MCX gold and silver futures for December expiry tumbled sharply, ignoring the movement seen in the international market. Major reason for the Indian bullion market was appreciation in the Indian Rupee against US Dollar, which appreciated by 1.84% to end the week at Rs. 70.65 per dollar.

ENERGY COMPLEXCrude oil prices plunged to their lowest since late 2017 on Friday, weighed down by emerging crude supplies and dampened economic outlook. To counter surging supply especially after US revamped production, OPEC is expected to start withholding output after a meeting planned for 6th December. Adjusting to lower demand, top crude exporter Saudi Arabia said on Thursday that it might reduce supply. Saudi Arabia is pushing OPEC to cut oil supply by as much as 1.4 million bpd to prevent a supply glut. Separately, International Energy Agency also expects Non-OPEC output solely to rise by 2.3 million bpd in 2018, whereas, global crude oil demand is expected to grow only by 1.3 million bpd. Looking over the demand from Asia’s largest buyer of Iranian oil, China is expected to resume purchases from Iran after the six month waiver from the US. China will start loading the crude again in November after it halted purchases in October, with a waiver allowing 360,000 bpd for six months starting November. Meanwhile, natural gas prices rose around 18% last week as the winter system approached and withdrawals are much visible now. EIA reported a storage draw of 134 Bcf for the week ending 16th November. This compares to the -117 Bcf projected and consensus average of -109 Bcf. The -117 Bcf was materially larger than the five-year average of -25 Bcf and last year’s -46 Bcf. And the bullish trend in storage is expected to continue as the temperature levels went colder than normal temperature persisting into early December.

BASE METALSThe third week of November started on a positive note for base metals amid easing dollar prices and a growing optimism on Sino-US trade wars, reversing the prior losses made. Dollar was modestly lower against its key rivals on Monday after Federal Reserve officials expressed caution over the global growth outlook, prompting traders to reassess the pace of future US interest rate increases. Aluminium’s persistent price weakness is compressing producer margins everywhere but the pressure is greatest in China and there are signs that it is claiming more smelter victims ever. Chinese production dropped sharply last month, according to the International Aluminium Institute (IAI), and unless the Shanghai market can breakout of its downtrend, more smelter casualties seem likely. The US Aluminium industry faces an acute and persistent issue of illegally subsidized Chinese Aluminium overcapacity in the market, but tariff or quota actions against countries like Canada and Mexico that operate as market economies do not address the China challenge and instead harm the overall competitiveness of the region. In the red metal, the fall in supply succeeded by rise in demand tracking the fall in premium levels to $18.50 from $47 of October suggests the support of copper prices for a trading session. Nickel found its factor to lose its prices after nine mines which were suspended by Philippines’ environment ministry are allowed to operate on a full scale giving ease for the Nickel output. The zinc market was in deficit by 52.3 KT during January to September 2018 which compares with a deficit of 431 KT recorded in the whole of the previous year2017. The copper market recorded a deficit of 6.3 KT in January to September 2018 which follows a surplus of 93.8 KT in the whole of 2017, thus, favoring the prices but largely capped by the closure of US markets on account of Thanksgiving day and more speculation in the markets will be seen making the prices likely to trade in a range for the weekend. Also, the next week looks for the closure of contracts for all the metals and the ripple effects will be seen making the markets volatile.

OILS & OILSEEDSSoybean futures are expected to trade on a mixed note with bias on positive side due to improved industrial demand at the physical market. Moreover, slower pace of arrivals and improved export prospects of meals is also supporting soybean prices at futures platform. Daily arrivals of soybean have been hovering in a range of 7-9 lakh bags since last 2 weeks as farmers are holding their produce in anticipation of further rise in prices. Technically, soybean prices are facing strong support zone near

Rs. 3380 - 3400 per quintal level and sustaining above support level due to good buying. Similarly, CBOT soybean prices are expected to trade on a positive bias due to rising hope of easing trade tension between US and China as these two countries may discuss their trade dispute in the upcoming G-20 summit which is scheduled next week. Moreover, slower harvesting progress and weakness in the dollar index could support CBOT prices in the coming week. Likewise, RM seed futures are expected to trade sideways to lower due to slack demand at the physical market. Adequate supply at key trading centers and accelerating sowing progress in major growing states could weigh on prices in the coming days. The area under mustard seed cultivation has touched 43.34 lakh hectares as against 44.46 lakh hac during the corresponding period in the previous rabi season. Moreover, reports of selling of mustard seeds stocks of Nafed could be the other factor which may put pressure on prices. Furthermore, CPO and Ref soy oil futures could extend its prices recovery next week too due to the reduced import of veg oil in India amid bargain hunting at a lower level.

COTTONDomestic cotton futures are expected to trade sideways to down in the upcoming week in expectation of rise in arrivals due to better price realization to farmers. Kapas prices are ruling much higher to the MSP level hovering near about Rs. 5600 -5900 per quintal level at key trading centers. Apart from that, the market may track cues from strengthening value of Indian currency against the US dollar making export more costly for Indian traders. Limited overseas demand for Indian fiber resulting with increased price disparity could affect the overall export from India and repercussion of the same could be seen on prices in near term. Indian currency appreciated further and was ruling near about 70.70 levels on Thursday. However, losses in cotton prices are likely to be limited due to weaker production outlook. Cotton Association of India (CAI) has estimated cotton crop for 2018-19 crop year at 343.25 lakh bales of 170 kgs each, which is lower by 4.75 lakh bales than 348 lakh bales announced at the Second Domestic Conference for 2018 held on 6th October 2018 in Aurangabad. Overall, the arrivals for the year 2018-19 has been lower by about 30% due to lower yield realization in Maharashtra and Karnataka. About 41 lakh bales of cotton arrived till mid of November, since starting of the marketing year 2018-19 commenced in October 2018, wherein, about 58 lakh bales arrived during the same period last year. Meanwhile, cotton procurement by CCI in Madhya Pradesh has commenced and has gathered pace in Telangana where CCI has procured about 10,000 bales of cotton so far. The Centre has fixed minimum support price for the medium-staple variety of cotton at Rs. 5,150 per 100 kg, and that for long staple at Rs. 5,450 per 100 kg, both Rs. 1,130 rupees higher than last year.

SPICESCardamom futures registered sideways to positive trend during the week. Slight slowdown in buying activities were noted at the spot markets due to higher prices while arrivals improved. However, arrivals are still relatively lower in the third round of picking activities and are expected to decline further during following fourth round. Overall, prices have rallied to their 21-month high and are at key resistance levels. Once breached the key resistance, prices are set to rally further on the supply concerns both in India and Guatemala. Plantation in Guatemala, the largest producer has reportedly been affected by the volcano. Turmeric futures were on the negative axis and dragged loss to 4th week in a row and fell to 6-month low of Rs. 6388/quintal. Expectations of higher production during the upcoming harvest due to higher area supported by good weather conditions continued to weigh on the prices. Stockiest and other buyers were hesitant to actively buy stocks on expectations of a higher crop in the upcoming harvest. However, prices recovered slightly from weekly fall and closed with a minimum weekly loss. For the week ahead, prices to recover further, as current levels are psychological support levels. Jeera futures cut short its 10-day fall during the week. However, it was mostly in the negative trend. Expectations of the area under jeera to improve after support from government continued to weigh prices. After the slow start to sowing, it improved as per the latest data. Sowing in Gujarat is completed in 44,200 hectares of land as compared to 130,100 hectares last year during the corresponding period. Dhaniya futures after trading up for 7 consecutive weeks fell on profit booking from multi-month high. Prices started the week on a positive note, extending prior gains on expectations of the lower area under dhaniya during the upcoming sowing season. For the week, correction may extend upto 6100 levels. However fundamental factors are bullish.


ALUMINIUM

As on 23rd November 2018, Aluminium 3M forwards are trading around $1937/Mt. Prices have started rebounding after taking supports around $1928 levels which is the long-term rising trend line also almost matching with the Fibonacci 61.8% support levels of the range $1432-2716. At present, the prices are trading below the weekly 8,21 EMA resistance levels $1997,2027. The momentum indicator RSI-14 is treading around 29, near the overbought zone. The overall trend is bearish and needs to breach $1920-1928 mark to resume bearish rally. Overall, we recommend selling on pullback levels around 1970 which is the horizontal trend line resistance. The view will be intact until the $1997 weekly 8EMA is not interrupted. LME Aluminium 3M sell around $1970-1975 TP 1928 SL 2000.MCX Aluminium Nov sell around Rs 138.50-138.80 TP 135 SL 140.60

ZINC

As on 23rd November 2018, Zinc 3M forwards at the LME platform are trading around $24510/MT, down by 4% from the previous closing price of $2617. In the bigger scenario, prices have started falling after making a high of $3595/Mt. Since last several weeks, the prices are trading within a confined range of $2280-2730. In this week, the prices have started falling after taking resistance around $2645 (Falling trend line). Prices are trading below the weekly 8,13 EMA resistance levels ($2544,2580). On the lower side, immediate supports are seen around $2475 intermediate rising trend line support then at $2442. Overall, the commodity is expected to resume long-term bearish rally and we recommend selling on pullbacks. LME Zinc 3M buy around $ 2555-2560 TP 2442 SL 2645.MCX Zinc Nov buy around Rs 185-185.50 TP 176 SL 191.50.

NICKEL

As on 23rd November 2018, Nickel 3M forwards at the LME platform are trading around $10,945/MT, down by 4% from the previous closing price of $11,935. In the bigger scenario, the prices have started falling after making a high of $16,690/Mt. The prices are trading below the weekly 8,13 EMA support levels ($11,900 - 12,200) also prices are falling along with trend channel support and resistances. Overall, the bearish trend is intact and expected to extend up to the long-term falling trend line support of $10,200 in the bigger scenario, before that immediate support is seen around $10,500 channel lower band. Higher side resistances are seen around $11,099 then at $11,440 which are the Fibonacci 38.2% and the current week’s high. LME Nickel 3M sell around $ 11100-11150 TP 10500 SL 11500. MCX Nickel Nov buy around Rs 780-785 TP 735 SL 810.

COMMODITIES

TREND SHEET

Commodities 16-Nov 23-Nov % Change 52 Week High% Change from 52

Week High52 Week Low

% Change from 52 Week Low

MCX Gold (Rs/10 gms) 31007.00 30495.00 -1.7% 32311.00 -5.62% 28055.00 8.70%

MCX Silver (Rs/Kg) 36991.00 36061.00 -2.5% 41698.00 -13.52% 35776.00 0.80%

MCX Crude Oil (Rs/bbl) 4074.00 3623.00 -11.1% 5669.00 -36.09% 3574.00 1.37%

MCX Natural Gas (Rs/mmBtu) 297.90 312.20 4.8% 358.70 -12.96% 162.50 92.12%

MCX Copper (Rs/kg) 442.90 429.85 -2.9% 493.25 -12.85% 402.55 6.78%

MCX Lead (Rs/kg) 143.70 137.10 -4.6% 172.50 -20.52% 136.00 0.81%

MCX Zinc (Rs/kg) 192.20 181.95 -5.3% 232.70 -21.81% 163.80 11.08%

MCX Nickel (Rs/kg) 816.70 764.40 -6.4% 1095.20 -30.20% 692.80 10.33%

MCX Aluminium (Rs/kg) 139.30 136.65 -1.9% 178.85 -23.60% 128.30 6.51%

NCDEX Soybean (Rs/Quintal) 3363.00 3423.00 1.8% 3895.00 -12.12% 2967.00 15.37%

NCDEX Refined Soy Oil (Rs/10 kg) 741.85 733.15 -1.2% 796.35 -7.94% 711.15 3.09%

NCDEX RM Seed (Rs/Quintal) 4054.00 4095.00 1.0% 4262.00 -3.92% 3727.00 9.87%

MCX CPO (Rs/10 kg) 507.20 508.30 0.2% 673.00 -24.47% 496.20 2.44%

NCDEX Castor Seed (Rs/Quintal) 6020.00 5642.00 -6.3% 6300.00 -10.44% 3831.00 47.27%

NCDEX Turmeric (Rs/Quintal) 6602.00 6482.00 -1.8% 8066.00 -19.64% 6316.00 2.63%

NCDEX Jeera (Rs/Quintal) 19310.00 19405.00 0.5% 22360.00 -13.22% 14010.00 38.51%

NCDEX Dhaniya (Rs/Quintal) 6202.00 6239.00 0.6% 6664.00 -6.38% 4186.00 49.04%

MCX Cardamom (Rs/kg) 1475.70 1485.60 0.7% 1505.00 -1.29% 818.50 81.50%

NCDEX Wheat (Rs/Quintal) 2079.00 2099.00 1.0% 2109.00 -0.47% 1575.00 33.27%

NCDEX Guar Seed (Rs/Quintal) 4620.00 4461.00 -3.4% 4869.50 -8.39% 3494.50 27.66%

NCDEX Guar Gum (Rs/Quintal) 9685.00 9136.00 -5.7% 10510.00 -13.07% 7200.00 26.89%

MCX Cotton (Rs/Bale) 22390.00 21750.00 -2.9% 24280.00 -10.42% 18190.00 19.57%

NCDEX Cocud (Rs/Quintal) 2006.00 1954.50 -2.6% 2043.00 -4.33% 1166.00 67.62%

NCDEX Kapas (Rs/20 kg) 868.00 868.00 0.0% 1010.00 -14.06% 854.00 1.64%

MCX Mentha Oil (Rs/kg) 1796.40 1668.40 -7.1% 1991.90 -16.24% 1106.00 50.85%

TECHNICAL RECOMMENDATIONS


COMMODITIES

NEWS DIGEST

• As a shadow of drought lingers over different parts of the country, rabi sowing data released by the Agriculture Ministry on Friday shows a 7% drop in the cultivated area as compared to the corresponding period in the previous year. As against 311.69 lakh hectares planted till the same week in 2017-18, 288.91 LH have been covered this year. The maximum shortfall was reported in the cultivation of coarse cereals and pulses. (Hindu Businessline)

• Exporters of groundnut and sesame seeds have urged the Union government to provide 10% incentive under the Merchandise Exports from India Scheme (MEIS) to boost the export to China and the European Union (EU). According to the Indian Oilseeds & Produce Export Promotion Council (IOPEPC), China and EU are among the most important world markets for oilseeds. Despite India being one of the largest exporters for groundnuts and sesame seeds, its exports to China is minimal. (Financial Express)

• State-owned Oil and Natural Gas Corp’s (ONGC) natural gas production has hit an all-time high of about 70 million standard cubic meters per day as it doubles up efforts to raise domestic output to curb imports, sources privy to the development said.

WEEKLY COMMENTARY

• Oil prices fell on Thursday after US crude inventories swelled to their highest level since December stoking concerns about a global glut but OPEC talk of an output reduction limited losses. Benchmark Brent fell 67 cents to $62.82 a barrel by 0904 GMT, after dropping by as much as $1 earlier in the session. US WTI fell more than a $1 before easing back to trade down 79 cents at $53.84.

• US commercial crude oil inventories climbed by 4.9 million barrels to 446.91 million barrels last week, the US Energy Information Administration (EIA) said on Wednesday, its highest level since December. US West Texas Intermediate crude futures rose 37 cents to $56.83 a barrel after their steepest one-day loss in more than three years on Tuesday. WTI is heading for a weekly loss of more than 5.5 %.

• Gold prices edged up on Friday and were on course for a third straight week of gains, supported by robust technical momentum and a softer dollar. A salesperson arranges 24K gold bars engraved with dogs at Chow Tai Fook Jewellery store ahead of the Lunar Year of the Dog in Hong Kong, China December 14, 2017. REUTERS/Tyrone Siu Spot gold was up 0.1 % to $1,225.75 an ounce by 3:14 p.m. EDT (1914 GMT). US gold futures settled down $1.4, or 0.11%, at $1,228.7.The yellow metal was headed for a 0.7 % rise this week.

• Chana prices declined by 0.53%, to Rs. 4,700 per quintal in futures trade on Thursday after participants reduced their exposure amid subdued demand at spot market. Profit-booking at higher levels also weighed on the sentiment. At the National Commodity and Derivatives Exchange, Chana for delivery in December was trading lower by Rs. 25, or 0.53%, at Rs. 4,700 per quintal, with an open interest of 30,470 lots.

MCX CRUDE MCX NATURAL GAS

CALENDAR SPREAD NYMEX - CRUDE OIL CALENDAR SPREAD NYMEX - NATURAL GAS

3500

3700

3900

4100

4300

4500

4700

0

50000

100000

150000

200000

250000

7-Nov

8-Nov

9-Nov

12-Nov

13-Nov

14-Nov

15-Nov

16-Nov

19-Nov

20-N

ov

21-Nov

22-Nov

23-Nov

Volume Open Interest Price (INR/Bbl)

250

270

290

310

330

350

370

0

50000

100000

150000

200000

250000

300000

6-Nov 8-Nov 12-Nov 14-Nov 16-Nov 20-Nov 22-Nov

Open Interest Volume Price (INR/MMBTU)

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

0.5

12-Nov 14-Nov 16-Nov 18-Nov 20-Nov 22-Nov

$/B

BL

-0.01

0

0.01

0.02

0.03

0.04

0.05

0.06

0.07

12-Nov 14-Nov 16-Nov 18-Nov 20-Nov 22-Nov

$/M

MB

tu


COMMODITIES

PRICES OF METALS IN LME/ COMEX/ NYMEX (IN US $)

Commodity Exchange Contract 16-Nov 23-Nov % change

Aluminium LME 3M 1947.00 1948.50 0.08%

Copper LME 3M 6242.50 6267.00 0.39%

Lead LME 3M 1995.00 1987.50 -0.38%

Nickel LME 3M 11395.00 10960.00 -3.82%

Zinc LME 3M 2617.00 2587.00 -1.15%

Gold CME DEC 1222.00 1226.70 0.38%

Silver CME DEC 14.39 14.50 0.73%

WTI Crude oil CME OCT 56.83 54.64 -3.85%

Natural Gas CME OCT 4.39 4.45 1.41%

INTERNATIONAL COMMODITY PRICES

Commodity Exchange Contract 16-Nov 23-Nov % change

Soybean CBOT NOV 919.00 910.75 -0.90%

Soy oil CBOT DEC 27.45 27.85 1.46%

CPO BMD DEC 1975.00 2045.00 3.54%

Cotton ICE DEC 76.19 76.63 0.58%

SPOT PRICES (% CHANGE)

LME WAREHOUSE STOCKS (IN TONS)

Commodity Previous week This week Change % Change

Copper 151625 139550 -12075 -7.96%

Zinc 123625 121550 -2075 -1.68%

Aluminium 1070925 1067000 -3925 -0.37%

Lead 110175 108175 -2000 -1.82%

Nickel 215328 214188 -1140 -0.53%

SHANGHAI WAREHOUSE STOCKS (IN TONS)*

Commodity Previous week This week Change % Change

Copper 134744 133163 -1581 -1.17%

Zinc 39675 35452 -4223 -10.64%

Aluminium 765353 750229 -15124 -1.98%

*Until Wednesday

WEEKLY STOCK POSITION IN LME (IN TONS)

Metal Supply and Usage:Supply and Demand of Metals (in KT)

Jan-Sep 2017 Jan-Sep 2018

Aluminium

Aluminium Production 44.38 44.49

Aluminium Consumption 45.38 44.70

Balance -1.00 -0.21

China production 24.66 25.00

China net exports (unwrought) 0.28 0.29

China net exports (Semis) 2.92 3.68

Copper

Copper mine production 15.07 15.36

Refined Copper Production 17.47 17.52

Refined Copper Consumption 17.49 17.53

Balance -0.02 -0.01

China apparent consumption 8.79 9.23

EU demand 2.53 2.55

Lead

Refined Lead Production 8.39 8.46

Refined Lead Consumption 8.71 8.60

Balance -0.32 -0.14

China apparent consumption 3.62 3.55

Nickel

Nickel mine Production 1.51 1.69

Refined Nickel Production 1.33 1.48

Refined Nickel Consumption 1.38 1.51

Balance -0.05 -0.03

Zinc

Refined Zinc Production 10.18 9.99

Refined Zinc Consumption 10.52 10.04

Balance -0.34 -0.05

Source: WBMS Monthly Release


USD/INR

USDINR Spot prices had started appreciating after making a record low of Rs. 74.48 against the USD in October 2018. On weekly basis, prices have settled at 70.65, appreciated by 1.8% from the previous week’s closing price of Rs. 71.97. At present prices are trading below the daily 8, 13 EMA levels (72.35, 72.70). The momentum indicator RSI-14 is trading below an equilibrium point at 35, which has a potential to move lower in the coming sessions. However, on the lower side important support is seen around 70.20 levels which are the Fibonacci 38.2% of the range 74.53-63.17 major support is seen at 69.13 levels previous tops. Weekly resistances are seen around 71.20 weekly midpoint and the current weeks higher 72.07 may act as trend interrupting point. Overall, we recommend building short positions on pullbacks. We recommend Selling around 71.20-71.25 TP 70.20/69.15 SL 72.10.

EUR/INR

EURINR prices closed lower at 79.99 down by 2.35% from the previous closing price of 81.85. At present, prices are trading below the 8,13 weekly EMA levels (83.35), in addition to this, prices are witnessing moving averages bearish crossover. During the current week’s prices have broken long-term rising trend line support levels around 81.15 and settled below the same. The momentum indicator RSI-14 is treading around 28 near the oversold zone. Support is seen at 79.22 which are the Fibonacci 38.2% of the range 86.08-68.11. Resistances are seen at 81.15 breakout point next at 82 current weeks’ high. The overall trend is bearish and we recommend selling on rise. We recommend selling at 81-81.20 TP 79.22/81.15 SL 82.00

GBP/INR

As on 23rd November 2018, GBPINR prices are trading around 90.61 down by 1.9% from the previous week’s closing price of 92.39. At present prices are trading below the weekly 8,13 EMA levels (93.90,94.26). Also, prices are trading below the Fibonacci 23.6% 93.91 also below 38.2% (91.13) of the range 98.53-79.12. The momentum indicator RSI-14 is treading around 31.00 has a potential to move lower. While combining the above technical clues, we are expecting the pair to fall up to 89.50 then 88.88 levels which are long-term rising trend line and the Fibonacci 50% of the above mentioned range respectively. Resistance at 91.13 then at 92.40 (Current week’s high). Overall we recommend selling on rise. We recommend selling around 91.10-91.20 TP 89.50 SL 92.40

JPY/INR

As on 23rd November 2018, JPYINR prices are trading lower at 62.64, from the previous week’s closing price of 63.77 down by 1.78%. Prices are trading below the weekly EMA 8,13 levels (64.38,64.50). The pair has broken the Fibonacci 23.6% retracement support at 63.91 and moving towards the 38.2% (62.36) of the range 55.81-66.41. Also, prices have broken long-term trend line support at 63.27 levels. The weekly momentum indicator RSI-14 is treading around 36.00. Overall the pair expected to move lower up 62.36 then 61.11. Based on the above technical indications, the trend is bearish and we recommend session on pullbacks. We recommend selling around 63.20-63.30 TP 62.36/61.12 SL 64.00

TECHNICAL RECOMMENDATIONMARKET STANCE

Although the dollar index recovered late during the week, still looks weaker compared to single currency Euro and Sterling. Euro edged higher this week as the tensions over Italy Budget looks to settle down at least for the time being. The currency market revolved around the risk sentiments during the week, with heightened Trade tensions between the US and China combined with looming dark clouds over possibly clam & clean Brexit negotiations. Back home, the Indian Rupee extended its gains during the short trading week. The biggest driver for Rupee strength is falling crude prices and moreover, positive cash flows into domestic markets. The broader dizziness in dollar index caused by uncertainty over Fed rate hike in December meeting after the economic data slightly slowed down also helped the rupee in adding the surprising gains. Multiple statements from Fed members and President Trump over Fed policy actions marginally lowered the probability of Fed rate hike. Yen added gains this week as the heightened global geopolitical tensions increased the demand for a safe haven as risk-averse investors tried to find shelter. US yields dropped to touch 3% handle where it might take support, where global investors await cautiously for Fed policy actions next month.

NEWS FLOWS OF LAST WEEK

• Feds Vice Chairman Clarida said he would not agree that fed hikes are going too far or too fast; will set policy to meet congressional goals he added.

• Spain is likely to vote against Brexit deal if the text on Gibraltar not changed.

• US President Donald Trump said China would like to make a deal and US may not have to impose further tariffs on Chinese goods.

• Italy Deputy PM Salvini said to open a dialogue on investments but not on Budget Deficit or Pension Reform.

• Salvini re-iterated that 2.4% Deficit target cannot be discussed.

• November PMI® survey data showed a further slowdown in the growth of Germany’s private sector, with the output of goods and services raising the least in almost four years and the pace of job creation also moderating.

• New order growth eased closer to stagnation amid a further decrease in net exports, which was in turn reflected in a weakening of business expectations.

• India FX reserves increased to $ 393.58 billion from $393.01 billion during the week ended on 16 November 2018.

CURRENCY

CURRENCY TABLE

Currency Pair Open High Low Close

USDINR 71.92 72.07 70.65 70.65

EURINR 82.0 82.08 79.89 79.90

GBPINR 92.32 92.52 90.41 90.43

JPYINR 63.77 63.94 62.53 62.60


ECONOMIC GAUGE FOR THE NEXT WEEK

Date Time Country Indicator Name Period Poll Unit Prior Prior

29 Nov 19:00 United States Jobless Claims 4-Wk Avg W 24 Nov Thou Person 218.5

29 Nov 19:00 United States Continued Jobless Claims W 17 Nov Mln Person 1.668

29 Nov 21:00 United States EIA- Nat Gas, Change Bcf W 23 Nov Bln Cft -134

29 Nov 21:00 United States Nat Gas-EIA Implied Flow W 23 Nov Bln Cft -134

27 Nov 19:25 United States Redbook MM W 24 Nov Percent 0.2

27 Nov 19:25 United States Redbook YY W 24 Nov Percent 6.2

28 Nov 17:30 United States MBA Mortgage Applications W 23 Nov Percent -0.1

28 Nov 17:30 United States Mortgage Market Index W 23 Nov Index 316.4

28 Nov 17:30 United States MBA Purchase Index W 23 Nov Index 227.7

28 Nov 17:30 United States Mortgage Refinance Index W 23 Nov Index 783.7

28 Nov 17:30 United States MBA 30-Yr Mortgage Rate W 23 Nov Percent 5.16

28 Nov 21:00 United States EIA Weekly Dist. Stocks W 23 Nov Mln Barrel 4.851

28 Nov 21:00 United States EIA Weekly Gasoline Stk W 23 Nov Mln Barrel -0.077

28 Nov 21:00 United States EIA Weekly Refining Util W 23 Nov Mln Barrel -1.295

28 Nov 21:00 United States EIA Weekly Crude Imports W 23 Nov Mln Barrel 0.183

28 Nov 21:00 United States EIA Weekly Rfg Stocks W 23 Nov Mln Barrel 0.008

28 Nov 21:00 United States EIA Weekly Heatoil Stock W 23 Nov Mln Barrel 1.162

28 Nov 21:00 United States EIA Weekly Prods Imports W 23 Nov Mln Brl/Day 0.191

28 Nov 21:00 United States EIA Weekly Dist Output W 23 Nov Mln Brl/Day 0.208

28 Nov 21:00 United States EIA Weekly Crude Runs W 23 Nov Mln Brl/Day 0.423

28 Nov 21:00 United States EIA Wkly Crude Cushing W 23 Nov Percent 2.6

28 Nov 21:00 United States Initial Jobless Claims W 23 Nov Mln Barrel -0.116

28 Nov 21:00 United States EIA Weekly Gasoline O/P W 23 Nov Mln Brl/Day -0.02

28 Nov 00:00 United States EIA Ethanol Ref Stk W 23 Nov Thou Barrel 22791

28 Nov 00:00 United States EIA Ethanol Fuel Total W 23 Nov Thou 1042

26 Nov 19:00 United States National Activity Index Oct 2018 Index 0.17

26 Nov 21:00 United States Dallas Fed Mfg Bus Idx Nov 2018 Index 29.4

27 Nov 19:30 United States Monthly Home Price MM Sep 2018 Percent 0.3

27 Nov 19:30 United States Monthly Home Price YY Sep 2018 Percent 6.1

27 Nov 19:30 United States Monthly Home Price Index Sep 2018 Index 266

27 Nov 19:30 United States CaseShiller 20 MM SA Sep 2018 0.2 Percent 0.1

27 Nov 19:30 United States CaseShiller 20 MM NSA Sep 2018 Percent 0

27 Nov 19:30 United States CaseShiller 20 YY Sep 2018 5.3 Percent 5.5

27 Nov 20:30 United States Consumer Confidence Nov 2018 135.5 Index 137.9

27 Nov 21:00 United States Texas Serv Sect Outlook Nov 2018 Index 14.1

27 Nov 21:00 United States Dallas Fed Services Revenues Nov 2018 Index 19.4

CURRENCY


ECONOMIC GAUGE FOR THE NEXT WEEK

Date Local Time Country Indicator Name Period Poll Prior Unit Prior

28 Nov 18:30 United States Build Permits R Numb Oct 2018 Mln No. of 1.263

28 Nov 18:30 United States Build Permits R Chg MM Oct 2018 Percent -0.6

28 Nov 19:00 United States Corporate Profits Prelim Q3 2018 Percent 2.1

28 Nov 19:00 United States GDP 2nd Estimate Q3 2018 3.5 Percent 3.5

28 Nov 19:00 United States GDP Sales Prelim Q3 2018 1.5 Percent 1.4

28 Nov 19:00 United States GDP Cons Spending Prelim Q3 2018 Percent 4

28 Nov 19:00 United States GDP Deflator Prelim Q3 2018 1.4 Percent 1.4

28 Nov 19:00 United States Core PCE Prices Prelim Q3 2018 1.6 Percent 1.6

28 Nov 19:00 United States PCE Prices Prelim Q3 2018 1.6 Percent 1.6

28 Nov 19:00 United States Adv Goods Trade Balance Oct 2018 Bln USD -76.25

28 Nov 19:00 United States Wholesale Inventories Adv Oct 2018 Percent 0.4

28 Nov 19:00 United States Retail Inventories Ex-Auto Adv Oct 2018 Percent -0.1

28 Nov 20:30 United States New Home Sales-Units Oct 2018 0.578 Mln No. of 0.553

28 Nov 20:30 United States New Home Sales Chg MM Oct 2018 4.5 Percent -5.5

28 Nov 20:30 United States Rich Fed Comp. Index Nov 2018 Index 15

28 Nov 20:30 United States Rich Fed, Services Index Nov 2018 Index -1

28 Nov 20:30 United States Rich Fed Mfg Shipments Nov 2018 Index 7

29 Nov 19:00 United States Personal Consump Real MM Oct 2018 Percent 0.3

29 Nov 19:00 United States Personal Income MM Oct 2018 0.4 Percent 0.2

29 Nov 19:00 United States Consumption, Adjusted MM Oct 2018 0.4 Percent 0.4

29 Nov 19:00 United States Core PCE Price Index MM Oct 2018 0.2 Percent 0.2

29 Nov 19:00 United States Core PCE Price Index YY Oct 2018 1.9 Percent 2

29 Nov 19:00 United States PCE Price Index MM Oct 2018 Percent 0.1

29 Nov 19:00 United States PCE Price Index YY Oct 2018 Percent 2

29 Nov 20:30 United States Pending Homes Index Oct 2018 Index 104.6

29 Nov 20:30 United States Pending Sales Change MM Oct 2018 0.5 Percent 0.5

29 Nov : United States Dallas Fed PCE Oct 2018 Percent 1.4

30 Nov 20:15 United States Chicago PMI Nov 2018 58.3 Index 58.4

CURRENCY


IAP Activity at Exide,

Activity at Canara Bank & Union Bank, Vizag

DEMATERIALISATIONIS MANDATORY

As per the notification issued by Ministry of Corporate Affairs, unlisted companies cannot issue physical shares from 2nd October, 2018. They have to issue shares in demat form only.

• Buyback, bonus issue and rights issue cannot be issued by these companies unless securities of company’s promoters, directors, etc. are in dematerialised form.

• Any investor who holds shares in unlisted companies has to get it dematerialised if he wants to transfer shares

• Any investor who wants to buy shares through private placement or avail bonus shares and rights issue has to hold shares in dematerialised form.

All unlisted companies are required to secure ISIN from CDSL or NSDL for each type of security.

Karvy being a pioneer in the financial realm since 3 decades and providing depository and RTA services as well can facilitate the process of dematerialisation of existing shares and also offer demat account opening facility.

Q. What is the main objective of a Demat account?

The main objective of a demat account is to facilitate easy trade and transfer of the shares and also enable an investor to get the benefits of corporate actions like bonus shares, dividend, rights issue, etc.

Q. How many accounts can I have?

• You can open more than one Demat Account.

• You can hold shares, debentures, bonds, NSC, KVP in a single Demat Account.

• You can save charges on multiple accounts by consolidating your holdings into one account, if there are no other compelling reasons to keep separate accounts.

Q. Can I take a loan on my demat holding?

1. Yes, you can pledge the securities in your account in favor of a lender to avail a loan.

Q. Is there nomination facility in Demat Account?

• Nomination can be made only by individuals holding beneficiary accounts either singly or jointly.

• The Nominee needs to complete a few formalities with DP and get the securities transferred into his/her account.

STEPS TO TRANSFER SHARESFROM ONE DEMAT ACCOUNT TO ANOTHER

Fill the DIS form & submit to your current broker

Your broker will send request to

depository (NSDL/CDSL)

Depository shall transfer the shares to your new Demat

Account

Shares shall reflect in your new Demat

Account

Investor surrenders the physical certificates to the DP

DP informs the

Depository about the request

DP submits the certificates to the Registrar of the issuer company

Registrar communicates

with the depository to confirm the

request

Dematerialization of the certificates

is done by the Registrar

Registrar informs the

depository about completion of

dematerialization

1 2 3 654

STEPS TO CONVERT PHYSICAL SHARES TO DEMAT

Q. Do I have to contact all companies for any updation in my personal details?

For your demat shares, your one point contact for all the changes/updation is DP.

Q. What precautions should I take to prevent misuse of securities lying in my account?

• Keep DIS book in safe custody.

• When writing an instruction on the DI Slip, strike-out the empty spaces.

• Change your password frequently if you are using internet facility for your Demat Account.

• Before giving Power of Attorney (POA) to any person operating your Demat Account, understand the contents and implication of such POA.

Q. How much do I pay for my Demat Account?

1. You can pay Rs. 650 as an account opening fee and enjoy many exclusive offers*.

Q. Whom should I contact in case of any queries?

1. You can call on our toll free no 18004198283 or write a mail at [email protected].

Q. What all documents are required to Open Demat Account?

1. To open a demat account, you need a mobile number linked to Aadhaar, active mobile number, PAN card, digital signature, cancelled personalized cheque.

Q. What if I already have a Demat account with another Depository Participant?

You can open a trading account with us and link it to your existing demat account. Alternately, you can open a new trading and demat account with us, transfer your securities and funds to the new account and close the older account.

Q. Things to check before Opening Demat Account

Before opening a demat account, one should always check the brokerage charges, annual maintenance charges, any other charges if applicable, technology and trading platforms and other supporting value-added features and customer services.

Q. Various Types of Demat Account

At Karvy, we offer customized solutions to meet every investor’s unique requirements. You can opt for only demat or only trading account, demat and trading account with access to trading equity, commodity, currencies, mutual funds and other exchange-traded securities.

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