ETMarkets Morning Podcast: Put-Call option positions signal pre-Budget rally ahead | The Economic Times Markets Podcast

ETMarkets Morning Podcast: Put-Call option positions signal pre-Budget rally ahead | The Economic Times Markets Podcast

Hi there! Welcome to ETMarkets Morning, the show about money, business and markets. I am Atul PM, and here is what we have to start your day.

>> Put-Call option positions signal pre-Budget rally ahead
>> Top investors shuffle midcap, smallcap holdings
>> Index funds gain traction among investors
>> Price hike likely to boost Maruti stock

And there is more. But first, a quick glance at the state of the markets..

>> Nifty futures on the Singapore Exchange traded 24.25 points higher at 8 am (IST), signalling a positive start for Dalal Street.

>> Asian stocks traded mixed this morning. Japan’s Topix index dipped 0.6%, Hong Kong’s Hang Seng rose 0.3% while South Korea’s Kospi dipped 0.3%. Australia’s ASX 200 rose more than 0.5%.

>> On Wall Street, the Dow rose 0.38% in overnight trade, while the S&P500 gained 0.81%. The tech-heavy Nasdaq Composite added 1.53%.

>> The rupee gained 11 paise to settle at 73.17 against the US dollar on Tuesday on the back of rally in domestic equities and weak American currency.

>> The dollar extended its retreat, as investors turned focus to riskier assets. The euro was 0.1% and the offshore yuan 0.1%. The yen traded at 103.81 per dollar.

>> Oil extended gains in Asia on expectations US President-elect Joe Biden’s incoming administration will take steps to revive growth and energy demand in the world’s largest economy. WTI contracts for February delivery, which expire Wednesday, rose 0.3% to $53.12 a barrel. Brent for March settlement climbed 0.3% to $56.04

>> Gold prices rose by Rs 81 to Rs 48,975 per 10 gm in futures trade on Tuesday as speculators created fresh positions on a firm spot demand. Silver too gained. On MCX, silver contracts for March delivery rose by Rs 520, or 0.79 per cent, to Rs 65,949 a kg. In international markets, gold rose 0.3% to $1,845.43 an ounce.

All in all, the trade setup on Dalal Street looked positive. On Tuesday, Nifty50 formed a strong bullish candle on the daily scale and negated the formation of lower highs. Analysts said Nifty can consolidate further, before commencing a larger rally

LET ME NOW GIVE YOU A HEADS-UP on some of the top news we are tracking at this hour.

… The change in the marketwide Put-Call option positioning seems to suggest the market maybe bracing for a pre-Budget rally. Whenever the value of the outstanding marketwide stock and index Call options is higher than that of the outstanding stock and index Put options by Rs 30,000 crore, the market tends to have bottomed out and hit new highs subsequently. This happened on four occasions earlier, the latest being on January 18, when the value of marketwide outstanding Calls exceeded that of the marketwide Puts by Rs 36,240 crore.

… Well-known investors on Dalal Street shuffled their mid- and small-cap holdings in the December quarter amid the broad-based rally in the market. Radhakishan Damani increased stake in India Cements by 0.7% and in VST Industries by 0.11% from the September quarter. Rakesh Jhunjhunwala upped stake in Tata Communications by 1% and bet on the Covid-hit hotel industry by raising stake in Indian Hotels by 1%. He pared stakes in Firstsource Solutions by 1.6% and in Escorts by 0.9%.

… The stock of Maruti Suzuki India has trailed the benchmark indices by 6% over the past three months on concerns over the impact of rising raw material costs on the operating margin. The company’s decision to increase car prices across the board should allay these concerns. Besides, the recovery in sales volume and tapering discounts are likely to support the stock in the medium term.

… Passive index funds tracking the broadest indices are gaining an edge over active stock pickers. Data from mutual fund industry body AMFI show that the number of folios in index funds doubled from 4.05 lakh to 8.11 lakh in the last 13 months. During the same period, assets under management of index funds surged 95% to Rs 14,794 crore. By contrast, the total AUM of the mutual fund industry moved up 15% — from Rs 26.94 lakh crore to Rs 30.96 lakh crore.


>> In a first, Sebi has asked France-based Schneider Electric President Systems to re-list its shares on any nationwide stock exchange within six months, or follow proper delisting process and give small shareholders an exit opportunity.

>> Bharti Hexacom, a subsidiary of India’s second largest telco Bharti Airtel, is raising up to Rs 1,500 crore via domestic bonds.

>> Fintech platform BharatPe has put in a joint bid with financial services firm Centrum to acquire troubled lender PMC Bank.

>> Canadian billionaire Prem Watsa-controlled CSB Bank said its net profit almost doubled to Rs 53 crore in the third quarter from Rs 28 crore a year earlier due to strong loan growth riding on a whopping 60% rise in loan against gold.

That’s it for now. For all the market news through the day, do track Have a great day ahead! Bye-bye

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