FED Interest rate most likely to be hiked on June 15

Stock Market Today by Shailesh Saraf – 19th May 2019

Stock Market Today by Shailesh Saraf – 19th May 2016
Indian Market Outlook:

FED interest rate most likely to be hiked from 25 bps to 50 bps in the scheduled June 15 FED meeting. On the backdrop of confirmation of US FED rate hike expectation in the June meeting, Nifty after testing its resistance at 7950 on 17th may is opening 30 points gap down from yesterday's close  at 7850 today.

The FOMC meeting minutes that were announced yesterday revealed that, “most Fed officials saw a June hike likely if economy warranted.” Moreover, the  US 3 month T bill yield has been steadily rising since the last few days rising from 0.18% on 5th  to 0.30% made on 18th may , this spurt is yield was last seen on 6th November 2015 which was an indication to the last rate hike occurred in December. A similar phenomenon is occurring now which gives clear indication that there might be rate hike in the June Meeting.

 

International Market Outlook

The greenback- Dollar ripped higher after the minutes revealed that, “most Fed officials saw a June hike likely if economy warranted.” Oil prices fell on Thursday, pulled down by rising U.S. crude inventories, a stronger dollar and surging output from Iran to Europe and Asia.

 

 
Open Interest-FII & Pro Combined Activity
 
Open Interest-FII & Pro combined activity

On 29th April FII & Pro combined had a total long position in Index Futures of 8582325 shares which is reduced to only 908850 shares as on 18 May, i.e. a total sell of 7992225 shares in current expiry.

Similarly, in Index options, FII and Pro combined have increased their short positions from 19668150 shares to 28602000 shares, i.e. a total sell of 12563100 shares in current expiry.

The data indicates a clear sell bias in the markets by FIIs and Proprietary.

 
Change in Options Open Interest Today
 
Change in options Open Interest Today

Today, FII have added 766350 shares long and 891450 shares short positions in Index Call option, net sell 125100 shares today. In puts, FII have reduced 475500 shares long and increased short positions by 1243350 shares, net PUT sell 1718850 shares today.

Pro, have reduced 475500 shares long and increased short position by 1243350 shares, a net sell of 1718850 shares in Index Call Option Today. In Puts, Pro has increased long position by 547575 shares and reduced short position by 18225 shares, a net buyl of 565800 shares in Put today.

 
FII Derivatives Statistics

The FII derivatives statistics data published by NSE shows that there has been net selling of 22179 contracts in Index Futures by FIIs which is worth 1281 crores. However, In Index options, the data shows that FIIs are net short 1694 contracts which is worth 111 crores. The data is misinterpreted generally since there has been a net sell worth Rs. 97 cr (approx) in the options market as shown in the table below. FIIs are net short in calls, which is SELL in the market, and they are net seller in the Puts which is BUY for the markets but its only 26 contracs hence is less significant. Hence instead of taking the difference of call and put we need to sum up both which gives a net sell worth 97 Cr in Index Options.

 
FII Derivatives statistics - NSE

FII Derivatives statistics - NSE

 
FII Options Statistics - Dynamic Research

FII Options Statistics - Dynamic Research

 
FII Index Statistics - Dynamic Research

FII Index Statistics - Dynamic Research

 
Major Events of the Day
Indian: Quarterly results today:   DEEPIND, LUPIN, IGARASHI, SOBHA, DISHMAN, GPPL, IRB, PIDILITE, CESC.
 
FII Index Future Buy /Sell activity
 
FII & DII Cash Buy/Sell activity

As on 18th May, for Current Expiry, FII have bought Rs. 202 crores worth shares along with DII who have bought shares worth Rs.3086 crores in the cash segment.

Today, FII have sold equity worth 250 cr and DII bought worth 240 cr.

 

*Top Price Gainers:

MEGHMANI ORGANICS: Most of the agrochemical and pesticides companies have rallied afterthe India Meteorological Department predicted good monsoon this year.

Top Price Gainers
 

*Top Price Losers:

SUDARSHAN CHEMICAL has rallied almost 17% in May from low of Rs. 106.10 and made high of Rs. 124.40, the stock has corrected 2.31% on profit booking. Stock is currently trading at Rs. 118.60 and major support as per Dynamic levels is at Rs. 116.10. This is a multibagger stock as per Dynamic Levels

Top Price Losers
 

*Top Volume Buzzers:

KITEX GARMENTS gave breakout with volume after remaining in a range for 1 month, stock surged almost 5.50%. Kitex has posted good Q4 result on 4th April 2016 profitability jumped by 13.78% YoY. .

Top Volume Buzzers
 
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