- There was a mix of short covering and measured institutional support on Friday as Nifty again showed strength to close above the 10,850 mark. The markets may face its first signs of resistance only around the 11,000 mark.
- The government decision to extend liquidity support to the NBFCs would be positive for the quality NBFCs and the HFCs as the immediate concern over liquidity is now taken care of till the end of March of 2019.
- FIIs were net sellers to the tune of Rs.(-120) crores while DFIs 1120 crore on Friday. The yearend buying by domestic financial institutions is quite normal considering the need to maintain NAV values and avoid any sharp MTM impact.
- There was a sharp bounce across Europe after it became clear that the BREXIT and the trade war were moving towards a rapprochement. The SGX Nifty is also quoting above the 10,900 mark and is likely to see strength on Monday too.
- The Nifty getting closer to the 11,000 mark is again a matter of caution. While markets may hold on 31st of December, one can look forward to some concerted selling in the New Year. Play with put options accordingly.
- With oil at below $55/bbl in the Brent market, it is time to again cherry pick aviation stocks. Jet Airways at around Rs.270 looks ripe for a bounce closer to Rs.330 in the next one quarter. Buy with appropriate stop loss.
- We see deep value in IOCL around the Rs.138 levels. The stock is likely to benefit from stable and low oil prices, which could actually prop up its refining margins. Also the dividend yields are quite attractive for the stock.
- While Monday may be a bullish day, we still see room for caution in the New Year. Starting accumulating puts in the New Year on the Nifty.
