Pre Stock Market Report, September 22, 2020

Pre Stock Market Report

Yesterday morning, though Asian markets were negative, we were doing well.
In the afternoon, when Europe opened, the news came that US 2 Trillion suspicious money handled by Banks.
Banking stocks fell in Europe.
That triggered a sell off in Banking stocks here also, which were already weak.
Then the sell off spread to other stocks also.
Reliance fell more than Rs 80 from intraday high.
Many stocks fell by 5% to 10%.
But Corona Virus spread, UK considering another lock down to control Corona virus, Banking scams broke out, Nifty reversed and tested 11200 almost.
When we closed Dow future was down about 500 points.
When markets opened there, it was down 950 points at lowest level, but recovered about half of the losses to close 500 points lower.
In fact, Nasdaq recovered about 90% of its losses, closed just 15 points lower.
Since Nasdaq was sold off already, there seems to be selling exhaustion.
But here, Bank Nifty is not seeing any selling exhaustion.
Yesterday's sell off may be a knee jerk reaction.
Today I expect European and US markets to stabilise.
SGX Nifty is trading about 60 points higher.
But we need to remember that even after 3 pm, Nifty fell nearly 75 points.
We may be recovering just that last 30 minutes loss.
Though recovery may be very little, we are happy that markets do not continue to fall.
Yesterday, in many Social Media, people were talking about Nifty 11000 today itself.
Gold, Crude, European Futures and US Futures are all recovering some lost ground now.
September series is one of the worst series.
Huge volatility, Nifty fell more than 150 points intraday many times.
Both FIIs and DIIs were net sellers in Cash market for about Rs 500 crore each.
FIIs were not short in F&O also.
So it was not really short selling that took the markets down, it was lack of buying that triggered the sell off.
Nifty future may trade between 11200 and 11380, wider range due to volatility.
4 stocks under F&O ban on NSE
Glenmark Pharma, Vodafone Idea, SAIL and Vedanta are under the F&O ban for September 22. Securities in the ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.

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