RULE THE MARKET ISSUE: 015 - 15TH DECEMBER, 2018 - Karvy
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15TH DECEMBER, 2018
RULE THE MARKET
ISSUE: 015
CONTENTS
From The Desk Of Research Head
Equity 1-6
Derivatives 7-8
Commodity 9-12 The recent slide in Bitcoin showcases the burst bubble
Currency 13-14 The rise and fall of Bitcoin
Events 15 Identifying the illogical soaring of bitcoin prices, the Indian regulators did the right thing by keeping
the bitcoin at bay which helped the investors from incurring steep losses. After reaching a peak of
$17,900 in December 2017, the price of bitcoin has fallen towards $3350 recently, losing over 80% in
value in just one year. Even though the initial rally was fuelled by optimism regarding wider acceptance
Team
of the crypto-currency, speculators entered the ring within the second part of the last year, inflicting a
Dr. Ravi Singh
fad that resembled the Tulip mania of the 1600s. However, the absence of an underlying asset backing
Syed Hasan Jafar
Viplav Dhandhukia for the cryptocurrency propelled its downfall losing 4/5th of its value from its all-time high.
Amrita Preetam
How were most Indian Investors saved from this gamble?
Amit Samar
Chirag M Solanki The regulators, as well as the Government of India, had kept a vigilant eye on crypto-currencies and
Chetan K Waghray had been informing the investors regularly. In two occasions prior to 2018, the Central bank issued a
Vaishali Paruthi warning against the cryptocurrencies. However, it was the Centre that took the primary step in putting
Pankaj Wadhwani an end to the floating of these assets through the Budget 2017-18 ruling that bitcoin isn’t a monetary
Benjamin Francis system in India. However, SEBI maintained a distance from passing any rules or guidelines against
Munindra Upadhyaya crypto-currencies because it viewed that they fall under the purview of the Central bank. As a result,
Yash Bhotika
the regulator’s silence was taken as consent by the crypto traders which turned out to mushroom
Sarath Jutur
various unregulated cryptocurrency trading exchanges. These developments prompted some
Konpal Pali
investors taking positions in bitcoin prior to its all-time high in December 2017 and continued until the
Thomas Abraham
budget 2017-18 budget announcement. However, the Central bank later banned all the entities and
Vivek Ranjan Misra
Veeresh Hiremath businesses that dealt in crypto-currencies halted the cryptocurrencies’ trading in India finally.
Arpit Chandna
Is it worth investing now at current levels by any other means?
Ravi Pandey
Anup. B.P Even though it was a bit late, the ban on bitcoin was absolutely timely. The recent slide in bitcoin value
Amit Kumar makes a clear picture that they’re not suitable for investment and wealth creation for retail investors. It
Ramesh Chenchala adds sound to the previous statement by taking Warren Buffet’s following words into consideration in
Siddhesh Ghare two different interviews, “Unlike buying stocks, bonds or real estate, buying bitcoin is not an investment.
Bharath Sunnam If you buy something like bitcoin or another cryptocurrency, you don’t have anything that is producing
Ravikanth Pedapati anything. You’re just hoping the next guy pays more. And you only feel you’ll find the next guy to pay
more if he thinks he’s going to find someone that’s going to pay more. This is not an investment, this is
Karvy Head Office
speculation. Bitcoin is a method of transmitting money. It’s a very effective way of transmitting money
Karvy Stock Broking Limited, Plot No.31, 6th Floor, Karvy
and you can do it anonymously. A check is a way of transmitting money too. But are checks too worth
Millennium Towers, Financial District, Nanakramguda,
Hyderabad, 500 032, India. a whole lot of money just because they can transmit money?. Considering the previous episodes, the
investor’s watchdog, SEBI also need to spell out its stance on these crypto assets so as to forestall a
For More updates & Stock Research
repeat of such episodes. However, these cryptocurrencies aren’t utterly useless, they will be effective
Visit: www.karvyonline.com
as a medium of exchange, provided they’re well regulated. The recent Central Bank’s move to form a
Toll free: 1800 419 8283
committee to explore the practicability of rupee-backed digital currency seems to be an honest plan
Email: research@karvy.com
for their domestic use.
Analyst Certification
The following Karvy Research Desk, who is (are) primarily responsible for
this report and whose name(s) is/ are mentioned therein, certify (ies) that
- DR. RAVI SINGH
the views expressed herein accurately reflect his (their) personal view(s)
about the subject security (ies) and issuer(s) and that no part of his (their)
Head-Technical & Derivatives Research
compensation was, is or will be directly or indirectly related to the specific
recommendation(s) or views contained in this research report.
Disclaimer: Karvy Stock Broking Limited [KSBL] is registered as a research analyst with SEBI (Registration No INZ000172733). KSBL is also a SEBI registered Stock Broker, Depository Participant, Portfolio Manager and also
distributes financial products. The subsidiaries and group companies including associates of KSBL provide services as Registrars and Share Transfer Agents, Commodity Broker, Currency and forex broker, merchant banker
and underwriter, Investment Advisory services, insurance repository services, financial consultancy and advisory services, realty services, data management, data analytics, market research, solar power, film distribution
and production, profiling and related services. Therefore associates of KSBL are likely to have business relations with most of the companies whose securities are traded on the exchange platform. The information and
views presented in this report are prepared by Karvy Stock Broking Limited and are subject to change without any notice. This report is based on information obtained from public sources, the respective corporate under
coverage and sources believed to be reliable, but no independent verification has been made nor is its accuracy or completeness guaranteed. The report and information contained herein is strictly confidential and meant
solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent
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markets. Past performance is not necessarily a guide to future performance. Forward-looking statements are not predictions and may be subject to change without notice. Actual results may differ materially from those
set forth in projections. Associates of KSBL might have managed or co-managed public offering of securities for the subject company or might have been mandated by the subject company for any other assignment in
the past twelve months. Associates of KSBL might have received compensation from the subject company mentioned in the report during the period preceding twelve months from the date of this report for investment
banking or merchant banking or brokerage services from the subject company in the past twelve months or for services rendered as Registrar and Share Transfer Agent, Commodity Broker, Currency and forex broker,
merchant banker and underwriter, Investment Advisory services, insurance repository services, consultancy and advisory services, realty services, data processing, profiling and related services or in any other capacity.
KSBL encourages independence in research report preparation and strives to minimize conflict in preparation of research report. 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
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It is confirmed that KSBL and Research Analysts, primarily responsible for this report and whose name(s) is/ are mentioned therein of this report have not received any compensation from the subject company mentioned
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report. We submit that no material disciplinary action has been taken on KSBL by any Regulatory Authority impacting Equity Research Analyst activities.
EQUITY
NEWS TREND SHEET
Symbol CMP S2 S1 R1 R2 TREND
Economy
• The Finance minister Arun Jaitley Thursday admitted there were two-three areas of
SENSEX 35962.93 33826 34894 36564 37164 Up
differences with the Reserve Bank (RBI), but questioned how a mere discussion on its
functioning could be considered “destruction” of an institution.
NIFTY 10805.45 10155 10480 10985 11164 Up
• The government has no proposal to change the existing foreign direct investment (FDI)
policy in the multi-brand retail trading sector
• India is likely to defer retaliatory duty against the US on the import of 29 products worth NIFTYBANK 26826 25106 25966 27319 27811 Up
USD 235 million for the fourth time to January 31, 2019.
Automobile YESBANK 180.35 145 163 196 211 Down
• Tata Nissan India has announced plans to hike prices of passenger vehicles by up to 4%
from 1st January, across all available models for Nissan and Datsun. RELIANCE 1,112.20 1025 1069 1142 1171 Down
BFSI
• NCLT approved amalgamation of Capital First and its two arms Capital First Home KOTAKBANK 1,255.95 1120 1188 1307 1358 Up
Finance and Capital First Securities with IDFC Bank.
• HDFC will raise up to Rs. 15bn by issuing bonds on a private placement basis. The SUNPHARMA 420.65 372 396 439 458 Down
‘HDFC Series U-006 18th June 2020’ secured redeemable non-convertible debentures
will open for subscription on December 17 and close the same day, HDFC said in a ICICIBANK 351.90 329 341 359 366 Down
regulatory filing Thursday.
• The government is considering additional capital infusion of up to 300 bln rupees in
IBULHSGFIN 792.90 614 704 844 894 Up
public sector banks as they have been unable to raise required funds from the markets.
Aviation
SBIN 289.20 258 274 299 310 Up
• The Federation of Indian Airlines, an aviation industry body has urged the civil aviation
ministry to allow an additional month of unsecured credit for aviation turbine fuel and
airport charges. MARUTI 7,662.15 6981 7321 7851 8041 Up
Metals
AXISBANK 620.25 563 592 637 654 Up
• The Government will auction two iron ore mines in Odisha to meet the shortage.
• NMDC Ltd’s iron ore production in Apr-Nov was 18.76 mn tn and sales were 19.30 mn
HDFCBANK 2,095.70 1991 2043 2136 2177 Up
tn. The company’s Apr-Nov iron ore production in Chhattisgarh was 12.24 mn tn, and
sales were 13.78 mn tn, while production in Karnataka was 6.52 mn tn, and sales were
5.52 mn tn.
Telecom
• The Telecom Disputes Settlement and Appellate Tribunal has quashed the telecom
regulator’s definition of “significant market power” and “predatory pricing” that was FORTHCOMING EVENTS
issued in the amendment to a tariff order in February.
• The Telecom Regulatory Authority of India has cut the time required to change an COMPANY NAME EX DATE PURPOSE RECORD DATE
operator, while keeping the same number, to just two to four days from seven days
earlier. BUY BACK OF
BOSCH LTD. 20-DEC-18 21-DEC-18
SHARES
Pharma
• Lupin Ltd received tentative approval from the US Food and Drug Administration to BUY BACK OF
SKF INDIA LTD. 20-DEC-18 21-DEC-18
market dimethyl fumarate delayed-release capsules, in 120-mg and 240-mg strengths. SHARES
• Sun Pharmaceutical Industries stated that promoter Raksha Valia had pledged 8.78 mln
shares or 0.37% stake with three different entities. The company said that the lien on INDIAN OIL BUY BACK OF
21-DEC-18 25-DEC-18
1.5 mn shares owned by Valia, which were pledged with Citicorp Finance India Ltd, had CORPORATION LTD. SHARES
been released on Monday.
Oil and gas
DHARAMSI
• The Indian Oil Corp Ltd will buy back up to 297.65 mn shares at 149 rupees apiece. The INTERIM DIVIDEND -
MORARJI 20-DEC-18 21-DEC-18
company will spend up to 44.35 bn rupees in the share buyback that will take place RS. - 0.50
CHEMICAL CO.LTD.
through the tender offer route.
INDIAN OIL
INTERIM DIVIDEND -
CORPORATION 21-DEC-18 25-DEC-18
RS. - 6.75
LTD.
INTERNATIONAL NEWS
CAPITAL INDIA RIGHT ISSUE OF
18-DEC-18 19-DEC-18
FINANCE LTD. EQUITY SHARES
• The Indian Tea Association (ITA) and China Tea Marketing Association (CTMA)
have signed a memorandum of understanding to promote green and black tea
consumption in major tea markets of Europe, the U.S., Russia and West Asia,
besides India and China.
• The Freight prices for containers going from China to the U.S. have surged over
100% from a year ago as of the beginning of December, according to data from
Freightos, an online freight marketplace.
• China confirms it will suspend its additional 25% tariff on imports of the U.S.
autos.
• Japan will allow unskilled foreigners to work in 14 sectors such as construction
and elderly care for up to five years.
KSTREET - 15TH DECEMBER 2018 1
2
NSEFMCG 12-12-18 DR. REDDY'S LABORATORIES
FII/FPI & DII TRADING (IN RS. CRORES)
NSEREAL JSW STEEL LTD
11-12-18 HOUSING DEVELOPMENT
SECTORAL INDICES (% CHANGE)
NSECON
TOP GAINERS & LOSERS (1W)
FINANCE
NSENRG RELIANCE INDUSTRIES LTD
10-12-18
DII
KOTAK MAHINDRA BANK
NSEMET
LTD
FII/FPI
BHARAT PETROLEUM CORP
NSEIT 09-12-18
LTD
NSEPHRM HERO MOTOCORP LTD
08-12-18
NSESRV YES BANK LTD
NSE NIFTY
NSEBANK INDIAN OIL CORP LTD
07-12-18
INDIABULLS HOUSING
NSEAUTO
FINANCE L
0
2500
1500
2000
500
-500
1000
-1000
2.5
3.5
0
1
0
4.5
4
1.5
5
4
12
-4
3
0.5
2
6
8
-6
2
-2
10
Midcap 100
CAC 40 VAKRANGEE LTD
NIFTY
JUBILANT LIFE SCIENCES
LTD
FTSE 100
Nifty Next
RELIANCE INFRASTRUCTURE
50
TOP GAINERS & LOSERS (1W)
LTD
SHANGHAI COMP
GLOBAL INDICES (% CHANGE)
INDIAN INDICES (% CHANGE)
DILIP BUILDCON LTD
SmallCap
BSE
HANG SENG GRAPHITE INDIA LTD
KSTREET - 15TH DECEMBER 2018
NIFTY MIDCAP100
BANK OF INDIA
MidCap
NIKKEI
BSE
QUESS CORP LTD
S&P500
SENSEX
DISH TV INDIA LTD
DOW JONES
LARSEN & TOUBRO
EQUITY
INFOTECH LTD
Nifty 50
NASDAQ PC JEWELLER LTD
25
0
15
-15
5
-5
20
30
-20
2.5
0
1
10
-1
-10
1.5
-1.5
3
0.5
2
-0.5
-2
2.5
3.5
0
1
4
1.5
3
0.5
2EQUITY
BEAT THE STREET - FUNDAMENTAL ANALYSIS
Zensar Technologies VALUE PARAMETERS
CMP Rs.240 Face Value (Rs.) 10.0
52 Week High/Low (Rs.) 352/146
Target Price Rs.269
M.Cap (Rs. Bn/US $mn) 3480/48
Upside 12% EPS (Rs.) 10.6
P/E Ratio (times) (FY20E) 12.9
Dividend Yield (%) 5.0%
Stock Exchange BSE
% OF SHARE HOLDING
Investment Rationale
• Revenue visibility improved aided by bottoming out of retail vertical and
ramp up of large deals won in the recent past.
• Focus on retail, insurance and hi-tech verticals – which are prone to higher
technical disruption.
• Focus on beefing up go-to-market strategy gives confidence of sustained
deal momentum.
• We are confident that ZENT with its digital-led strategy and focus on in Rs.Mn ACTUAL ESTIMATE
high growth high potential verticals and geographies is set to embark its
YE Mar FY 18 FY 19 FY 20
journey on a high growth path.
• ZENT has demonstrated its digital capabilities by transforming into a 100% REVENUE 31077 39232 43547
living digital enterprise. This strategy has enabled it to revamp its go-to- EBITDA 3729 4699 6532
market strategy and showcase its digital offerings on the go. The success
of this strategy is visible in the large deals it announced recently- worth EBITDA(%) 12.0 12.0 15.0
$800 mn over the past 18 months – the highest ever in the company’s PAT 2416 3013 4181
history.
EPS (Rs.) 10.6 13.4 18.6
• This coupled with its focus on RoD Next offerings and digital-led strategy
are expected to bode well for the company’s future growth strategy. RoE (%) 15.4 16.8 20.0
PE (x) 16.9 17.9 12.9
Valuation P/E CHART
We remain positive about the company based on improved revenue
visibility aided by bottoming out of retail vertical, ramp up of recent
large deal wins and expectation of sustained deal momentum aided
by its RoD-based offerings.
We believe that ZENT’s margins will improve aided by operational
efficiencies and higher IMS margins post-restructuring. Hence, we
recommend a “HOLD” with a target price of Rs. 269 and an upside
potential of 12%.
Risks
Key risks include concentration risk as a result of ZENT’s focused
approach and revival in margins may take longer than expected as
the company is currently in an investment mode.
KSTREET - 15TH DECEMBER 2018 3EQUITY
BEAT THE STREET - FUNDAMENTAL ANALYSIS
Relaxo Footwears Ltd VALUE PARAMETERS
CMP Rs.724 Face Value (Rs.) 1.0
52 Week High/Low (Rs.) 874/564
Target Price Rs.911
M.Cap (Rs. Bn/US $mn) 87.24/1.21
Upside 26% EPS (Rs.) 13.4
P/E Ratio (times) (FY20E) 30.0
Dividend Yield (%) 0.2
Stock Exchange NSE
% OF SHARE HOLDING
Investment Rationale
• In the listed space, Relaxo has been a consistent performer in the last 5
years. Relaxo – which focuses on providing higher quality footwear at
competitive prices in the low price region, have managed to widen their
reach and improve volumes.
• Consequently, Revenue has grown at 14%, and operating margins have
improved by 458 bps, leading to 29% CAGR growth in PAT over the same
period.
in Rs.Mn ACTUAL ESTIMATE
• Since 2012, the company has increased focus on brand building via
celebrity endorsements. Additionally, it has also increased pace in rolling YE Mar FY 18 FY 19 FY 20
out of brand stores. Currently, Relaxo has 311 brand retail outlets. It also
REVENUE 19644 22984 26661
spends about 4.5% of its revenues on advertisements, which is higher than
its immediate peers in the listed space. EBITDA 3021 3482 4103
• Tapping into the urban market, the company has launched casual and
EBITDA(%) 15.4% 15.1% 15.4%
regular sportswear in the branded category through Sparx. Currently,
Sparx is believed to constitute ~10% of total volumes. Aided by the PAT 1611 1947 2353
increased acceptance of these higher value products, realizations have
EPS (Rs.) 13.4 16.2 19.6
improved by ~5% CAGR in the last 5 fiscals.
• Backed by improving realization and growing customer base (across rural RoE (%) 23.6% 23.1% 22.9%
and urban India), we expect top and bottom line to grow by 16.3% and 21.1%
PE (x) 48.6 44.7 36.9
CAGR over FY18-21E.
P/E CHART
Valuation
Consistent performance has led to improvements in valuations by 4x over
the past 5 fiscals. We expect the growth trend to continue, and value the
stock at 38x (at a premium to its 5 year average 2 year fwd P/E of 30x),
on FY21E EPS of 24 and arrive at a target price of Rs. 911. We believe the
premium valuation is warranted, given the high growth expected in the
coming fiscals and the brand building efforts being undertaken.
Risks
Key risks to the call are difficulties in penetrating into the online category,
and intensified competition from unorganized players.
KSTREET - 15TH DECEMBER 2018 4EQUITY
BEAT THE STREET - TECHNICAL ANALYSIS
Bajaj Finance Ltd
Stock BAJFINANCE
CMP 2486
Action BUY
Entry 2470
Average 2390
Stop loss 2200
Target 2970
Target 2 3050
Time Frame 6-9 Months
BAJFINANCE has been in the secular uptrend on the weekly charts making higher highs and higher lows. The stock has witnessed profit taking from its all-time high near
2994 levels and found support near its 21 period moving average on the monthly chart which is placed around 1900 levels. The historical price action reflects that the stock
has respected the said moving average and bounced well from the same. The bounce that the stock has seen from its 21 period moving average has seen higher volumes,
suggesting accumulation taking place in this counter. On the momentum oscillator front, the 14 period RSI is placed above the 9 period signal line on the daily as well as weekly
charts and pointing northwards, suggesting strength in the near term. The major support for the stock is seen around its short to medium term moving averages on the
daily chart placed near 2390 levels, breaching which it may find its next support around its long-term moving average on the daily chart which also coincides with the swing
support for the stock placed near 2230 levels. The stock is trading above all of its major moving averages on the daily, weekly as well as monthly charts, indicating positive
momentum in the counter for all major time frames. The recent price action suggests that strong hands are accumulating the stock at lower levels. Considering all the above
data facts, we recommend entering the stock at the current levels for the potential targets of 2920-2990 levels. And any correction towards 2390 levels can be utilized to
average the stock keeping strict stop loss placed below 2230 levels.
Tata Chemicals Limited
Stock TATACHEM
CMP 687
Action BUY
Entry 680
Average 645
Stop loss 600
Target 800
Target 2 840
Time Frame 6-8 Months
TATACHEM is trading resiliently since its previous swing low at 622 levels and has witnessed a bullish divergence with the current up move in the daily charts with decent
volumes. As the bullish divergence started to unfold, the stock has also witnessed a crossover of 50 day EMA levels at 690 levels which are a positive confluence and
confirmation, indicating the buying interest in the stock. Among the leading indicators, CCI (15) and Heiken candlesticks indicate a positive trend in the daily chart as well as
the weekly charts. RSI (14) and Stock (5,3,3) indicators in daily chart is showing bullish bias, indicating stronger hands are accumulating the stock on every dip.
On the momentum setup, weekly MFI (10) is pointing northwards after giving a positive crossover with the signal line and, in the daily time frame, the oscillator bounced off
taking the support of 25 levels, reaffirming underlying strength in the counter. Daily MACD (12, 26, 9) as well is trading above the zero line on the charts, indicating the inbuilt
strength in the counter. Considering all the above data, we recommend traders to enter the stock at the current levels for the higher targets of 770 followed by 800 levels and
any correction towards 655 levels can be utilized to average the stock keeping a stop loss below 620 levels on closing basis.
KSTREET - 15TH DECEMBER 2018 5EQUITY
SECTORAL SNIPPETS
NIFTY BANK (26,826) underperformed Nifty with a gain of 0.87% during the week NIFTYAUTO (9271.50) outperformed Nifty 50 index on weekly basis and ended
passed by, while the broader index Nifty gained 1.05%. During the week, the index the week in green with gains over 4.5%, which was majorly due to the gains
gained after making a swing low at 25,598 levels and surpassed the crucial 26,659 in the heavyweight counters like HEROMOTOCO, MOTHERSUMI, BOSCHLTD,
resistance levels. The index saw a bullish rally after the new RBI governor Shaktikanta TATAMOTEICHERMOT and TVSMOTOR which gained 8.06%, 7.56%, 6.19%, 5.94%,
Das said that he would take a more consultative approach and move quickly to and 5.08%, respectively. Technically, the support zone of 8650 is also the swing
address some of the pressing issues. The markets ignored the sudden resignation support zone played a crucial role and reverted the trend for the index from where
of Urjit Patel, perhaps because it might lead to a more liberal monetary policy with it started to rally upwards, indicating bulls had taken control in the counter at the
the appointment of Shaktikanta Das as the new Reserve Bank of India Governor. lower levels. On the daily chart, the stock is placed below the medium moving
Considering the positive bias in the index, market participants may stay long with average, indicating inherent weakness and the downside may be expected near
a bullish bias until unless 26,400 levels are breached. On the stock specific front, the recent swing low placed around 8950 levels, which would play a crucial role for
most of the index stocks closed in green except a few. PNB, FEDERALBNK, YESBANK, supporting the index. On the weekly chart, 14 periods RSI is on the verge to witness
IDFCBANK and RBLBANK gained 10.15% to 5.18% during the week. On the other short-term plunge as it has been placed near the oversold zone of 40-41 levels,
side, KOTAKBANK lost 1.81% with respect to the weekly closing basis. Technically, affirming weakness in the counter. The immediate support for the index is placed
BankNifty may face crucial resistance at 27,000 and 27,200 levels. For the week around 8950 levels followed by 8735 levels, while on the contrary the resistance is
ahead, support for the index can be pegged at 26,500 levels followed by 26,400 pegged around 9300-9350 levels followed by 9500 levels. For the coming week,
levels. On the momentum setup, 60-period weekly CCI is plotting above its +100 line, stock specific action can be witnessed; however, it is advisable to trade cautiously
indicating an underlying bullishness in the index. However, we expect a subdued in the counter tracking the support and resistances for the stocks.
movement in the index if it falls below the 26,400 levels.
NIFTYFINSE (11327.60) saw inline movement with Nifty and generated positive return NIFTY REALTY (237.20) ended the week on a gain of around 2.80%, outperforming
of around 0.08%, while Nifty closed the week with a positive return of around 1.02%. The NIFTY-50 which closed with a gain of around 1.01%. The breadth of the REALTY
index was under pressure after making high of 11,517 levels. It had dragged to the low of index was also positive as 8 stocks out of 10 stocks in the index ended on a positive
10,837.60 levels and bounced from the said levels. The index is trading above all its major note while 2 stocks ended on a negative note. Stocks which gained in the last
moving averages on the daily charts. Most of the stocks from the financial space were week were HDIL, IBREALEST, PRESTIGE, BRIGADE, DLF, PHOENIXLTD, SOBHA, and
seen trading comfortably last week. The immediate support in the index comes around GODREJPROP which gained around 11.29%, 10.79%, 7.74%, 3.38%, 3.13%, 2.53%,
11,200 levels and below that are 11,050 levels. The index may find resistance around 11,525 2.47%,and 1.70%, respectively, while OBEROIRLTY, and UNITECH lost 0.35%, and
levels and above that are 11,700 levels. Most of the stock from the sector has closed the 2.33%, respectively. Technically, the said index is trading well above its daily 20-day
week in green and generated positive return like BAJAJFINSV, BHARATFIN, ICICIPRULI, simple moving average but below its 20- week simple moving average. The weekly
IBULHSGFIN and M&MFIN closed the week with a positive return of around 5.18%, 3.10%, & daily 14-period RSI is trading above its 9 periods EMA, indicating a bullish bias
10.05%, and 8.20%, respectively. Whereas, the stock like HDFC and BAJFINANCE has in the near term. Going ahead for the coming week, the index has support at 230
closed the week in red and generated negative return of around 2.40% and 0.40%. levels and below it at 220 levels, while resistance is pegged at 242 levels and above
it at 248 levels.
However, the index is expected to trade with sideways tone for the coming week.
BATA INDIA LTD: BUY BATAINDIA (DEC FUTURE) | CMP: 1090.45 SECTOR: CD
Sentiment
BATAINDIA gained 2.52% during the week. The stock witnessed a strong
rally from 653.10 levels to 1115.70 levels and started to correct from these
levels. However, the stock has found support at 1115.70 which is 200 EMA
Stop Loss 1028
in daily chart and 61.80% Fibonacci retracement levels of the said rally on a
closing basis and started to up move. The stock is in an uptrend from this Target 1145
support levels as making higher high and higher low in the daily charts. The
Lot Size 550
stock is trading well above 21/50/100/200 DEMA levels, indicating strength
in the counter for all major time frames supporting our bullish bias. The price Margin 105500
has taken the support of mean and is moving towards the upper band of
Bollinger band (20, 2) in the daily chart, supporting our bullish conviction 21-DEMA 1036
about the stock. We expect the stock outperform in the near term. Hence, Open Interest Shares 2064700
we recommend smart traders to initiate a Long position on dips around 1080
levels with a stop loss placed below 1028 for the target of 1145 levels. Change in OI 255200
Cost of Carry (%) -2.19
JSW STEEL LTD: SELL JSWSTEEL (DEC FUTURE) | CMP: 294.25 SECTOR: METALS
JSWSTEEL is our preferable bet from the metal sector for short. The stock is
in a downtrend and making lower lows and lower highs on the daily charts. The Sentiment
stock has underperformed Nifty metal last week and generated a negative
return of 3.14%. Whereas, Nifty metal generated a positive return of around
Stop Loss 318
1.56%. The stock has given a breakdown around 300 levels and closed the
week well below the same. Before that, the stock has seen a sharp fall from the Target 273
recent life high of around 428 levels. The fall in the stock has seen supportive
Lot Size 1500
volume formation on the daily and weekly charts. The stock is trading below
all its major moving averages on the daily charts, which indicates weakness in Margin 77100
the counter. On technical setup, the stock is pointing southwards after giving
21-DEMA 314
a negative crossover with a signal line, indicating weakness in the stock will
remain intact. The Parabolic SAR is trading above price on the weekly charts, Open Interest Shares 49845000
indicating that the downtrend in the stock will remain intact in the near term.
Change in OI 837000
Hence, we suggest smart trader to short the stock for the downside target of
273 levels with a stop loss placed above 318 levels. Cost of Carry (%) 11.02
KSTREET - 15TH DECEMBER 2018 6DERIVATIVES
WEEKLY VIEW OF THE MARKET
NIFTY (10,805.45): During the last week, broader markets, specifically Nifty swiveled in a massive range of about 500 odd points and saw a series of dramatic twists and turns on the international and
domestic front. The week started with Urjit Patel resigning from the post of the RBI governor citing personal reasons, while the actual cause was evident as his ideology was not going well with that of
the government. With Indian National Congress sweeping the polls in the 3 major states in the Hindi belt, viz. Rajasthan, MP and Chattisgarh, the markets initially reacted negatively, however, things got
factored in and the market participants chose to buy strongly as the numbers inclined towards the Congress’ victory. However, one must admit that pessimism prevailed until the magical numbers of the
majority were not clear.
On the other hand, global markets were under tremendous pressure for a slew of reasons, the major one being a possible spike of tensions between the US and China after the CFO of Huawei was
arrested earlier. But the markets recovered strongly after the US President Donald Trump added a dramatic new twist on Tuesday by suggesting he may intervene in American efforts to prosecute the CFO
of Huawei, if it would help his pursuit of a trade deal with China. On the domestic front, the IIP rose at almost a one-year high in October 2018 led by a spurt in the manufacturing and mining sectors while
retail inflation for November slowed to a 17-month low on cooling food prices. Growth in the IIP came in at 8.08% in October, in comparison to 4.47% in the prior month and 1.83% in the corresponding
quarter, last year. On the other hand, CPI inflation dropped sharply to 2.33% in November from 3.38% in October 2018, thereby adding to the positivity. Another major reason for the markets to recover
from lows was the appointment of the new RBI governor in quick time by the government, which appointed Mr. Shaktikanta Das as the new RBI Governor.
DERIVATIVE STRATEGIES
Type: Bull call spread in BPCL
First leg Buy one lot of BPCL 27 Dec 340 CE @ 10.20
Second leg Sell one lot of BPCL 27 Dec 360 CE @ 3.25
BEP 346.95
Max Profit 23,490
Max Loss 12,510
Rationale The stock has come out of consolidation range in the last trading session and has resumed its uptrend. Hence, a bullish strategy is recommended.
Type: Bear put spread in RELINFRA
First leg Buy one lot of RELINFRA 27 DEC 300 PE @ 17.50
Second leg Sell one lot of RELINFRA 27 DEC 270 PE @ 5.50
BEP 288.0
Max Profit 23,400
Max Loss 15,600
Rationale The stock is in short-term downtrend and is trading below its short to medium-term moving averages. The stock has also seen short build-up in the last week.
Type: Bear Put Spread in NIFTY
First leg Buy one lot of NIFTY 27 DEC 10950 PE @ 181
Second leg Sell one lot of NIFTY 27 DEC 10650 CE @ 56
Max Profit 13,125
Max Loss 9,375
BEP 10,825.0
Rationale The index is expected to find resistance at higher levels. Hence, it may trade with mixed bias in days to come.
Type: Short Strangle in Bank Nifty
First leg Sell one lot of BANK NIFTY 20 DEC 27200 CE @ 71
Second leg Sell one lot of BANK NIFTY 20 DEC 26400 PE @ 62
Max Profit 2,660
Max Loss Unlimited above & below UBEP & LBEP
BEP UBEP = 27333 & LBEP = 26267
Rationale The index is expected to trade with mixed to range bound.
KSTREET - 15TH DECEMBER 2018 7DERIVATIVES
NIFTY OPTION OI CONCENTRATION CHANGE IN NIFTY OPTION OI
BANKNIFTY OPTION OI CONCENTRATION (WEEKLY) CHANGE IN BANKNIFTY OPTION OI (WEEKLY)
FII ACTIVITY IN INDEX FUTURES FII ACTIVITY IN STOCK FUTURES
TOP 6 LONG BUILD UP TOP 6 SHORT CLOSURE
Stock Name LTP % Price Change Open Int % OI Change Stock Name LTP % Price Change Open Int % OI Change
CHOLAFIN 1229.5 0.34 985500 70.95 COALINDIA 247.15 4.39 43128800 -21.03
COLPAL 1311.65 6.22 1603000 37.79 HEXAWARE 328.1 3.81 3226500 -18.18
TVSMOTOR 570 5.26 7584000 36.72 AMARAJABAT 734.55 4.45 1176700 -18.08
IGL 253.3 2.01 6418500 23.10 NTPC 143.5 4.10 73300000 -16.13
M&MFIN 454.55 8.68 11387500 20.39 L&TFH 146.85 5.80 18058500 -15.25
KSCL 590 14.80 1308000 19.29 BEL 82.4 2.87 41475150 -15.25
TOP 6 SHORT BUILD UP TOP 6 LONG CLOSURE
Stock Name LTP % Price Change Open Int % OI Change Stock Name LTP % Price Change Open Int % OI Change
RELINFRA 291.95 -5.20 11402300 45.67 HDFCBANK 2095.7 -0.56 11724500 -8.79
JETAIRWAYS 259.9 -5.92 6575000 35.43 DIVISLAB 1491.4 -0.03 3620800 -5.77
ARVIND 99.9 -0.40 6126000 15.76 ICICIBANK 351.9 -0.09 83682500 -3.43
DRREDDY 2591.7 -3.75 3907000 15.12 KOTAKBANK 1255.95 -1.85 11926400 -3.16
CONCOR 650.65 -1.54 3485000 15.06 OIL 176.25 -0.90 13215312 -2.87
AUROPHARMA 726.2 -3.35 20636000 13.23 TORNTPOWER 253.45 -1.29 2217000 -1.20
KSTREET - 15TH DECEMBER 2018 8COMMODITIES
BULLION prices. Progress is very slow in the major growing states; as per latest data, sowing in
Gujarat is completed in only 24033 hec of land which was 62587 hec last year during
In global markets, gold prices fell on Friday and marked its biggest weekly decline
the corresponding period; the area is lower by 62% YOY while it is covered just 26%
in five weeks due to a firmer dollar. The gold prices were pressurized by a stronger
of the normal area. Dhaniya prices are expected to continue gains for the week.
dollar which is exerting downward pressure on gold. Stronger than expected US retail
sales combined with a weaker than expected flash PMI reading in the EU lead to the
headwinds experienced by gold. The next trigger for gold is the outcome of the OILS & OILSEEDS
US Federal Reserve’s December 18-19 meeting, where the US central bank is widely Soybean futures could keep it down in upcoming week too due to higher production
expected to raise interest rates. The following interest hike will be its fourth rate hike outlook for the year 2018-19. Indian soybean market reacted negatively to the news
this year which was expected but the market will be more focused on the policy of easing trade dispute between the US and China as Indian traders could lose export
outlook for 2019. The Fed is widely expected to strike a dovish tone for next year that opportunities if China resumes soybean import from the US. Meanwhile, limited
will act as a support for gold prices. Lower interest rates reduce the opportunity cost buying at physical market due to tumbling crush margin to millers could be another
of holding bullion and weigh down on the dollar. As per the commitment of traders factor which may keep prices under pressure. Soybean Processors Association of
(COT) report released by CFTC, managed net long positions in gold futures and India (SOPA) estimated soybean production for the year 2018-19 at 114.8 lakh tons
options combined increased by 308 contracts while net short positions also surged against the 83.5 lakh tons of prior year. Similarly, RM Seed futures are expected to
by 231 contracts. In the coming week, Federal Reserve rate decision will be the major trade on the weaker note due to higher production outlook for upcoming season
event to watch during the week as the recent developments in the US economy reports of increased acreages under mustard seed could keep prices under
increased the uncertainty over the consensus of a 25 bps rate hike. Albeit, 111 analysts pressure. The area under mustard seed cultivation has touched 59.15 lakh hectares
polled by Reuters suggest a rate hike of 25 bps to 2.50% from 2.25%, FOMC members as against 57.89 lakh hec during the corresponding period in the previous rabi
comments on the future course of action will be keenly watched. season, higher by 4.29% YoY. However, the expectation of rise in export demand of
mustard seed oil cake from China could restrict major downfall. China has lifted the
CRUDE OIL ban on the import of mustard seed cake from India. India exported about 25234 tons
of Rapeseed meal during October, higher by 11% YoY. Meanwhile, CPO futures are
Crude oil futures posted week-on-week losses, taking the negative cues from
expected to trade down in expectation of rise in production estimates in Malaysia
monthly reports released by IEA & OPEC which suggested global demand to shrink
during December. Malaysia’s palm oil stockpiles at the end of Nov rose by 10.45%
in 2019. Similarly, EIA monthly report suggested that the oil production from the US
MOM to 3.007 million tons wherein export for Nov month dropped by 12.87% to
will remain apprehended in upcoming years. West Texas Intermediate (WTI) crude
1.37 million tons as per latest data released by Malaysian Palm Oil Board (MPOB).
oil for January lost $1.38 Friday to settle at $51.20 per barrel. Compared to the prior
However, production tumbled by 5.64% MoM to 953,750 tons as per MPOB. Exports
week’s settlement, the WTI is down by 2.7 percent for the week. The February Brent
of Malaysian palm oil products for December. 1-10 fell 9.6 percent to 312,160 tons
oil futures price also declined on Friday, falling $1.17 to end the day at $60.28. For the
from 345,219 tons shipped during Nov. 1-10 as per data compiled by cargo surveyor
week, the Brent is down by 2.25%. OPEC broke the string in oil market by bringing
Societe Generale de Surveillance.
in the production cut agreement and agreeing with more than expected production
cut levels. OPEC & Russia both agreed to remove 1.2 mn bpd of oil supplies from
the market in lieu of pushing the global market towards balancing. Following the COTTON
bilateral meetings between Saudi Arabia, Iran and Russia, producers group decided MCX cotton prices are expected to trade sideways to higher in the upcoming week
to exempt Iran from reducing production and restricting it more than the market may track its strong fundamentals. Reduced supply at key trading centers resulted
expectation of 1 million bpd. The OPEC-led supply curbs will be made from January with slower arrivals pace is likely to support prices in coming days. Daily arrivals
and were measured against October 2018 output levels. Looking over the demand are hovering in a range of 1.35-1.5 lakh bales compare to normal of 2 lakh bales.
side fundamentals, Brent crude lost around 30% of its value since the gruesome Lower yield realization in central and southern region affecting the pace of arrivals
trade spat between US-China threatened a global economic slowdown and eroded adversely. The average yield for cotton in India during the year 2018-19 is estimated
the investor’s positive optimism. Despite the expectations of a slowdown, crude at 502 kg/hec against the 506 kg/hec of the prior year. Meanwhile, trimmed its
oil demand remained apprehended as indicated by Chinese imports in November production forecast for India from 28 million bales of 480 lb each to 27.5 million bales
which rose by 8.5% on year-on-year basis. Also for the first time on records, the US (352.6 lakh bales of 170 kg each). Prices are likely to be buoyed by tighter supply
during last week of November exported more crude oil and fuel than it imported. situation as total arrivals for the year 2018-19 has been lower by 20-25% compared
The country shipped around 3.2 million bpd in the first week of December as shale to the previous year and expected to remain lower in coming months too. Apart
oil producers rushed in to capture the market share and reduce their building shale from that, improved export viability of Indian fiber supported by the weakness of
supplies glut. As a key demand driver for the prices, Chinese purchases for its Indian currency against US dollar could be another factor which may help prices to
strategic reserve and required feed from its new refineries will influence the prices. trade on positive bias in near futures. Sharp gains in ICE cotton prices could emerge
Whereas any of the shocks prompted by US President or change in the geopolitical export opportunities to Indian traders in coming weeks. ICE cotton futures traded
dynamics could again affect the prices positively. higher in expectation of a rise in export demand from China and the US and China
agreed to a common consensus not to impose any new tariff for the next 90 days.
SPICES Cotton Association of India estimated total cotton production for the year 2018-19 at
343.25 lakh bales, lower by 1.4% compared to the prior year. Ministry of Agriculture
Cardamom futures traded mostly in a positive note during the week tracking lower
projected cotton production for the year 2018-19 at 324.83 lakh bales in its first
crop size. Despite expectations of major shortage, major gains are yet to be seen
advance estimates against the 348.88 lakh bales of prior year, lower by 7% YoY.
and prices are hovering near their 2-year high levels as lack of exports to Saudi
However, gains in cotton is likely to be limited due to demand concerns as domestic
Arabia is arresting major gains. For the week ahead, cardamom futures are likely to
millers are avoiding bulk buying due to higher price disparity of Indian fiber.
trade with bullish sentiments in the market. After conducting only one auction per
day at auction centers for the past few months, cardamom auctions will be back
to ‘Two auction slot system” from 17th Dec onwards. Turmeric futures noted sharp GUAR
gains during the week on emerging crop concerns reports from various growing Guar complex futures traded mixed to positive during the week ended on 14th
regions. Firstly, drought conditions in growing states have affected the yield levels Dec 2018 due to improving demand outlook in physical market tracking bullish
leading to lower crop. Further, rains in Telangana and Andhra Pradesh due to cyclone fundamental outlook. Paucity of stocks amid restricted supplies added positive
may cause damage to standing crops. Harvesting has already started in few regions sentiments in the market. Recovery in Crude oil prices in the second consecutive
where early sowing was carried out, but farmers are likely to bring huge quantities week with slightly down in Indian rupee was supportive for gum prices. Guar seed
to spot markets on anticipation of MSP of Rs.10000/quintal for turmeric as promised most active January contract gained by 0.96%and settled the week at Rs 4417 higher
during the elections in Telangana. We suggest buying for the week. Jeera futures by Rs 89 per quintal from the last week wherein gum futures moved up by 1.18% and
mostly traded negative during the week tracking improvement in the sowing closed the session at Rs 8654 8865 gained by Rs 211 per quintal from the previous
progress. The progress of the sowing activities that was slow during the start picked week. In Rajasthan, arrivals were recorded around 55688.1 quintals during the week
up pace after the supply of water resources, hence weighing on the prices as total down by 31560 quintals from the last week. Guar seed and guar gum are expected
area in the key growing states may increase by 10% YOY. As per latest data, sowing in to trade Sideways with positive bias due expectation of improve export demand
Gujarat is completed in 268368 hec of land that was 311366 hec last year during the outlook in major trading center. Low arrival amid improved demand in major trading
corresponding period; the area is lower by 14% YOY while it is covered 84% of the center is likely to supportive for guar prices in futures and spot market. This week the
normal area. We expect jeera futures to trade in a negative note for the week, hence second time the oil rigs countdown by 04 numbers with a total count of 873 updated
sell on rise is suggested. Dhaniya futures mostly traded in a range with positive by Baker Hughes in his weekly report. However, losses are limited as expanding
bias during the week. Prices traded down initially on profit booking; however, supply-demand gap in line with shrinking in arrivals in all over India. Slightly weakness
prices recovered to trade higher on expectations of the lower area under dhaniya in Indian INR against the US dollar during the week is likely to supportive for gum
as farmers are shifting to another crop such as wheat and chana for guaranteed exporters and traders.
KSTREET - 15TH DECEMBER 2018 9COMMODITIES
TREND SHEET
% Change from 52 % Change from 52
Commodities 7-Dec 14-Dec % Change 52 Week High 52 Week Low
Week High Week Low
MCX Gold (Rs/10 gms) 31595.00 31553.00 -0.1% 32311.00 -2.35% 28205.00 11.87%
MCX Silver (Rs/Kg) 37972.00 38054.00 0.2% 41698.00 -8.74% 34981.00 8.78%
MCX Crude Oil (Rs/bbl) 3849.00 3690.00 -4.1% 5669.00 -34.91% 3464.00 6.52%
MCX Natural Gas (Rs/mmBtu) 324.00 276.10 -14.8% 358.70 -23.03% 162.50 69.91%
MCX Copper (Rs/kg) 438.45 441.70 0.7% 493.25 -10.45% 402.55 9.73%
MCX Lead (Rs/kg) 142.20 140.30 -1.3% 172.50 -18.67% 133.15 5.37%
MCX Zinc (Rs/kg) 188.00 183.40 -2.4% 232.70 -21.19% 163.80 11.97%
MCX Nickel (Rs/kg) 781.30 790.90 1.2% 1095.20 -27.78% 708.50 11.63%
MCX Aluminium (Rs/kg) 140.30 137.60 -1.9% 178.85 -23.06% 128.30 7.25%
NCDEX Soybean (Rs/Quintal) 3277.00 3372.00 2.9% 3895.00 -13.43% 2967.00 13.65%
NCDEX Refined Soy Oil (Rs/10 kg) 738.40 740.80 0.3% 796.35 -6.98% 712.50 3.97%
NCDEX RM Seed (Rs/Quintal) 4019.00 4085.00 1.6% 4262.00 -4.15% 3727.00 9.61%
MCX CPO (Rs/10 kg) 492.50 506.50 2.8% 673.00 -24.74% 483.40 4.78%
NCDEX Castor Seed (Rs/Quintal) 5474.00 5380.00 -1.7% 6300.00 -14.60% 3831.00 40.43%
NCDEX Turmeric (Rs/Quintal) 6252.00 6294.00 0.7% 8066.00 -21.97% 5978.00 5.29%
NCDEX Jeera (Rs/Quintal) 18515.00 18320.00 -1.1% 21900.00 -16.35% 14010.00 30.76%
NCDEX Dhaniya (Rs/Quintal) 6563.00 6653.00 1.4% 6892.00 -3.47% 4186.00 58.93%
MCX Cardamom (Rs/kg) 1479.60 1475.00 -0.3% 1550.00 -4.84% 818.50 80.21%
NCDEX Wheat (Rs/Quintal) 2119.00 2118.00 0.0% 2135.00 -0.80% 1614.00 31.23%
NCDEX Guar Seed (Rs/Quintal) 4337.00 4377.00 0.9% 4869.50 -10.11% 3494.50 25.25%
NCDEX Guar Gum (Rs/Quintal) 8654.00 8879.00 2.6% 10510.00 -15.52% 7200.00 23.32%
MCX Cotton (Rs/Bale) 21910.00 21890.00 -0.1% 24280.00 -9.84% 19360.00 13.07%
NCDEX Cocud (Rs/Quintal) 1901.50 1910.00 0.4% 2043.00 -6.51% 1166.00 63.81%
NCDEX Kapas (Rs/20 kg) 868.00 868.00 0.0% 986.50 -12.01% 854.00 1.64%
MCX Mentha Oil (Rs/kg) 1588.30 1491.70 -6.1% 1846.10 -19.20% 1106.00 34.87%
TECHNICAL RECOMMENDATIONS
COPPER NICKEL ZINC
• As on 14th December 2018, LME copper 3M forwards is • As on 14th November 2018, Nickel 3M forwards at the LME platform • As on 14th November 2018, LME Zinc 3M forward is trading at $
trading at $6100/Mt. is trading around $10800/MT down. 2522/Mt.
• Prices are trading below the monthly & weekly 8, 13 EMA • In the bigger scenario prices have started falling after making a high • Prices are trading below the weekly 8, 13 EMA support levels
of $16690/Mt, ($2580.2590) and also trading below the monthly 8,13 EMA
levels ($M $6300/6360 W $6160).
• Prices are trading below the weekly 8, 13 EMA support levels ($2680.2760).
• The momentum indicator RSI -14 is trading around 43, which ($11400, 11600) also prices is falling along with trend channel • The long-term falling trend line is providing resistance at $2660
as a potential to move lower. support and resistances ($10000-11500). levels.
• Since last several weeks prices are trading within a confined • Daily RSI-14 is treading around 41 approaching the oversold zone. • The weekly momentum indicator RSI-14 is treading at a neutral zone
range of $6400-5970. • Lower side supports are seen at 10400 then at 10000 levels which of 44 which as a potential to fall further in the coming weeks.
• Overall bearish trend is in progress and expecting prices to are falling channel lower band and the long-term rising trend line • Since last several months, prices are trading within a confined range
resume the trend in the coming week. support levels respectively. of $2728-2283.
• Overall the bearish trend is intact and expected to extend. • LME Zinc prices are expected to trade within a range of
• LME Copper prices are likely to trade on a negative note
• LME Nickel prices are likely to trade in a range of USD 10000 – USD 2660-2400 on negative bias. Long term bearish trend
in the range of USD 6300 - 5900 USD 11,500 on negative note in the coming week. is in progress, only a sustainable trade above the 2760 may
interrupts the trend.
KSTREET - 15TH DECEMBER 2018 10COMMODITIES
NEWS DIGEST WEEKLY COMMENTARY
• At the start of the cotton year, 2018-19 (Oct-Sep) delays in harvesting and • Oil settled below $52 a barrel in New York, more than a $1 lower than where it
concerns about output amid scanty rains kept cotton prices higher. In November, ended a week ago after OPEC and its allies announced output cuts, as traders
cotton prices fell due to poor exports and an increase in arrivals, post-Diwali. weighed incremental U.S. shale growth against softer demand for 2019. Saudi
However, prices should once again bounce considering the latest estimates of Arabia’s plan to slash exports to the U.S. next month is shoring up expectations
the Cotton Association of India (CAI) regarding the 2018-19 crop. that the Organization of Petroleum Exporting Countries and its partners will
• Rabi acreages so far still trail last year’s levels, even though the pace of planting deliver on last week’s promise to curb production by 1.2 million barrels a day. Yet
has been progressing steadily, reducing the gap, as witnessed early this month. the oil market appears to have largely ignored cuts agreed to just a week ago,
According to the Agriculture Ministry, the total acreages, so far, stood at 476.12 concerned by the relentless growth from U.S. shale, which veteran crude trader
lakh hectares, down 5.2% from last year. In the first week of December, the gap Andy Hall says is making it hard to predict the market’s direction.
in acreages stood at over 8%. • Gold eased for the second straight session to hit a one-week low on Friday as
• Former RBI Governor Raghuram Rajan on Friday said farm loan waiver should not the dollar rose, putting the metal on track to post its biggest weekly fall in five
form part of poll promises and he has written to Election Commission that such ahead of the US Federal Reserve’s interest rate decision next week. Spot gold
issues should be taken off the table. was 0.3% lower at $1,238.86 an ounce as of 10.41am GMT. Earlier in the session,
prices hit their lowest since December 6 at $1,236.80. The metal is down about
• China’s meager first purchase of U.S. soybeans since its trade war with the United 0.7% so far this week. US gold futures were down 0.4% at $1,242.80 an ounce.
States began in July disappointed farmers, grain traders and a U.S. government
official hoping for larger sales to lift slumping prices and absorb a huge surplus • US soybean net export sales for the 2018-19 marketing year were 792,269 mt
across the U.S. farm belt, they said on Thursday. The U.S. Department of for the week ending December 6, down 11.07% from the previous week, the
Agriculture (USDA) announced private sales of 1.13 million tons of U.S. soybeans Department of Agriculture data showed. Since the new marketing year began
to China, confirming sales Reuters reported a day earlier. September 1, total commitments — cumulative exports plus outstanding sales
— were reported at 24.941 million mt, 33.76% below the same period last year.
• A severe cyclone, Phethai, is likely to hit the Andhra Pradesh coast on Monday The total commitments represent 48.23% of the USDA’s 51.709 million mt of
afternoon, the India Meteorological Department (IMD) warned in its latest exports estimated for the entire marketing year.
weather forecast. This is the fourth cyclone to hit the eastern coast this season
and comes about a month after cyclone Gaja hit the Tamil Nadu coast on 16 • Base metals were mostly up in a tight range on Wednesday, following U.S.
November, causing massive destruction. Earlier, cyclone Daye and very severe President Donald Trump’s upbeat comments about a trade deal with China,
cyclone Titli ravaged coastal areas in Odisha and Andhra Pradesh. while the dollar held near a one-month peak against its peers. China has agreed
to cut tariffs on U.S.-built cars and auto parts to 15 percent from 40 percent
currently, while Trump said talks were taking place with Beijing by phone and he
would not raise tariffs on Chinese imports until he was sure about a deal.
MCX CRUDE MCX NATURAL GAS
0.3
0
12-Dec
13-Dec
2-Dec
7-Dec
3-Dec
30-Nov
11-Dec
14-Dec
8-Dec
6-Dec
9-Dec
5-Dec
1-Dec
4-Dec
10-Dec
0.25
-0.05
0.2
-0.1
$/BBL
$/MMBtu
0.15
0.1 -0.15
0.05
-0.2
0
3-Dec 5-Dec 7-Dec 9-Dec 11-Dec 13-Dec -0.25
MCX CRUDE- PRICE, VOLUME & OPEN INTEREST MCX NATURAL GAS – PRICE, VOLUME & OPEN INTEREST
120000 340 400000 3900
330 350000 3850
100000
320
300000 3800
80000 310
250000 3750
300
200000 3700
60000
290
150000 3650
40000 280
100000 3600
270
20000 50000 3550
260
0 3500
7-Dec
3-Dec
30-Nov
6-Dec
5-Dec
4-Dec
10-Dec
28-Nov
29-Nov
12-Dec
13-Dec
11-Dec
14-Dec
0 250
28-Nov 30-Nov 4-Dec 6-Dec 10-Dec 12-Dec 14-Dec
Open Interest Volume Price (INR/MMBTU) Volume Open Interest Price (INR/Bbl)
KSTREET - 15TH DECEMBER 2018 11COMMODITIES
SPOT PRICES (% CHANGE) WORLD COTTON SUPPLY AND USE
Soybean 2.90%
Commodity Exchange Contract 07-Dec Contract 07-Dec 14-Dec % change
CPO 2.84% World Nov 80.39 119.39 41.11 126.88 41.13 72.61
Guar Gum 2.60%
Dec 80.45 118.74 41.71 125.63 41.73 73.19
Barley 2.24%
United States Nov 4.3 18.41 0.01 3.3 15 4.3
RM Seed 1.64%
Dhaniya 1.37% Dec 4.3 18.59 0.01 3.3 15 4.4
Nickel 1.23% Australia Nov 2.94 2.5 3/ 0.04 3.7 1.71
Guar Seed 0.92%
Dec 2.94 2.5 3/ 0.04 3.6 1.81
Copper 0.74%
Brazil Nov 8.66 10 0.08 3.5 5.5 9.73
Turmeric 0.67%
Cotton Seed Oil Cake 0.45% Dec 8.66 11 0.08 3.5 5.8 10.43
Soy Oil 0.33% India Nov 8.68 28 1.5 25.3 4.3 8.58
Silver 0.22%
Dec 8.68 27.5 1.6 25.3 4.4 8.08
Wheat -0.05%
Mexico Nov 0.66 1.73 0.9 1.9 0.6 0.76
Cotton -0.09%
Gold -0.13% Dec 0.66 1.73 0.9 1.95 0.6 0.71
Cardamom -0.31% China Nov 38.02 27.5 7 42.5 0.15 29.87
Jeera -1.05%
Dec 38.02 27 7 41.5 0.15 30.37
Lead -1.34%
European
Castor Seed Nov 0.27 1.66 0.71 0.75 1.53 0.32
-1.72%
Union
Aluminum -1.92%
Dec 0.27 1.66 0.71 0.75 1.53 0.32
Zinc -2.45%
Turkey Nov 1.88 4.5 2.9 7.1 0.4 1.78
Crude Oil -4.13%
Mentha Oil -6.08% Dec 1.88 4.3 2.9 7 0.4 1.68
Natural Gas-14.78% Pakistan Nov 2.83 8 2.6 10.8 0.15 2.46
-16.00% -14.00% -12.00% -10.00% -8.00% -6.00% -4.00% -2.00% 0.00% 2.00% 4.00%
Dec 2.83 7.4 2.9 10.6 0.15 2.36
Indonesia Nov 0.62 3/ 3.65 3.55 0.01 0.71
Dec 0.62 3/ 3.65 3.6 0.01 0.66
WEEKLY STOCK POSITION IN LME (IN TONS) Thailand Nov 0.18 3/ 1.13 1.1 0 0.18
Dec 0.18 3/ 1.18 1.15 0 0.18
Bangladesh Nov 1.86 0.14 8.1 8 0 2.08
SHANGHAI WAREHOUSE STOCKS (IN TONS)* Dec 1.86 0.14 8.1 8 0 2.08
Vietnam Nov 1.19 3/ 7.6 7.5 0 1.29
Commodity Previous week This week Change % Change
Dec 1.19 3/ 7.6 7.5 0 1.29
Copper 123879 122222 -1657 -1.34% Unit in Million 480-Pound Bales
Zinc 26850 24879 -1971 -7.34%
Aluminium 713267 688825 -24442 -3.43%
*Until Wednesday COMEX WAREHOUSE STOCKS (IN TONS)
Commodity Previous week This week Change % Change
LME WAREHOUSE STOCKS (IN TONS) Copper 129104 120020 -9084 -7.04%
Commodity Previous week This week Change % Change
Copper 122500 121225 -1275 -1.04% PRICES OF METALS IN LME/ COMEX/ NYMEX (IN US $)
Zinc 113875 119000 5125 4.50%
Commodity Exchange Contract 07-Dec 14-Dec % change
Aluminium 1040975 1150100 109125 10.48%
Aluminium LME 3M 1963.00 1925.50 -1.91%
Lead 104250 106800 2550 2.45%
Copper LME 3M 6149.00 6140.50 -0.14%
Nickel 210846 209688 -1158 -0.55%
Lead LME 3M 1995.00 1954.00 -2.06%
Nickel LME 3M 10955.00 11040.00 0.78%
INTERNATIONAL COMMODITY PRICES
Zinc LME 3M 2585.00 2533.00 -2.01%
Commodity Exchange Contract 07-Dec 14-Dec % change
Gold CME DEC 1249.40 1238.10 -0.90%
Soybean CBOT NOV 940.75 926.25 -1.54%
Silver CME DEC 14.56 14.49 -0.48%
Soy oil CBOT DEC 28.41 28.72 1.09%
WTI Crude oil CME OCT 52.13 51.23 -1.73%
CPO BMD DEC 1998.00 2068.00 3.50%
Cotton ICE DEC 74.90 74.90 0.00% Natural Gas CME OCT 4.50 3.79 -15.84%
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