Pre Stock Market Report, October 20, 2020

 

1. US markets closed about 1.5% lower.
2. But Asian markets are mostly flat with negative bias.
3. That is because there seems to be some improvement in Stimulus talks.
4. Nasdaq is down for last 5 days and Dow is down 4 out of last 5 days.
5. So if there is any good news about Stimulus, US markets may move significantly higher.
6. SGX Nifty is Trading Near Yesterday closing near 11850.
7. The reason why SGX Nifty is flat despite a big fall in U.S Markets is Because Dow Futures are up by half a percent now.
8. U.S Markets dont like Uncertainty , any market doesn't like Uncertainty.
9. This is causing profit booking in Emerging Markets
10. Due to Stimulus talks being halted theres a lot of Uncertainty going around.
11. Here Reliance, IT Stocks are not doing well.
12. Even HDFC Bank did not do well after results.
13. Key results are already out, except Reliance.
14. Reliance do not move due to results, it moves due to JIO & Retail news.
15. SO we need a trigger to cross 12000.
16. But that trigger may not come from locally.
17. A strong short covering in Reliance and IT stocks may be a possible scenario.
18. TCS has fallen about Rs 150, Reliance has fallen about Rs 200 from recent highs.
19. US Stimulus could be a possible trigger.
20. FIIs have Rs 1657 crores, more than what they have sold in the previous two days.
21. But DIIs sold aggressively for a similar amount, Rs 1622 crores.
22. SGX Nifty is down by about 30 points due to Global cues.
23. HDFC ADR is up 2.5% while it was flat here.
24. But HDFC Bank ADR trades at huge premium, so it is not comparable.
25. ACC & Britania came with good results.
26. So far, all results are good.
27. Yesterday Nifty future faced resistance around 11900 but closed very near to highest point.
28. Today markets may consolidate once again but may break out tomorrow, if there is any positive development in Stimulus.
29. Europe continue to trade lower as virus resurgence is a big problem there.
30. But that is not the case with rest of the world.
31. Next 3 days we may expect Consolidation between 11700 to 12000.
32. If any of these levels gets taken out then there will be a big rally towards that side.
33. Until then one should play for this range.
34. The Trend is intact and strong.
35. There May be hiccups in between but the Trend will continue to follow.
36. Another thing which I've been observing from many days is VIX is slowly inching higher.
37. VIX isnt falling and inching higher with each passing day.
38. This shows that Volatility is going to rise in coming weeks and there might be big swings.
39. Take those to your Advantage.
40. Nifty might Trade between 11740-11920.
41. Reliance, once again came under severe selling pressure when moved higher.
42. Reliance fell more than Rs 50 from intraday high, though Nifty closed at the highest point.
43. Bank Nifty has recovered about 4000 points from September low.
44. Reliance, IT and Banking stocks will be in focus.
45. ACC and Britania will be in focus after results.
46. HUL and Bajaj Finance will be in focus ahead of results.
47. High dividend yield stocks moved higher yesterday, like ITC, PFC, IOC, BPCL, etc.
48. Though markets are moving higher, VIX is not coming down.
49. So premiums are still high.
50. Nifty future may trade between 11780 and 11920.

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