SGX Nifty up 50 points; here's what changed for market while you were sleeping

The sharp sell-off in domestic equities last week has turned the short-term trend negative and the overall mood sombre. While there are chances of a rebound, the upside is likely to be capped as investors will avoid aggressive bets ahead of the Budget and US Fed policy action.

The widespread positions in the options of Nifty 50 indicates the uncertainty over market direction among traders. The board range indicated by the options data is 17000-19000 range for the 50-stock index.

Here's breaking down the pre-market actions:

STATE OF THE MARKETS

SGX Nifty signals a positive start
Nifty futures on the Singapore Exchange traded 48 points, or 0.27 per cent, higher at 17,737.50, signaling that Dalal Street was headed for a positive start on Monday.

• Tech View: Renewed selling for three consecutive sessions saw the Nifty 50 breach key support of 17750-17775 levels. The breakdown resembles a bearish flag pattern and if this pattern works then it might test 17200–17000 in the near term.
• India VIX: The major selling on Friday brought in high volatility in the market and saw the ‘fear gauge’ hit a 3-month high of 18.0125 points on Friday.

US stocks gain
Equities rose on Friday, buoyed by better-than-expected economic growth data and a sharp rise in Tesla shares.

• Dow Jones: 33978.08 (0.1%)
• S&P 500: 4070.56 (0.25%)
• Nasdaq: 11621.71 (0.95%)

Asian shares up
Asian shares started cautiously on Monday in a week that is certain to see interest rates rise in Europe and the United States, along with U.S. jobs and wage data that may influence how much further they still have to go. Earnings from a who's who of tech giants will also test the mettle of Wall Street bulls, who are looking to propel the Nasdaq to its best January since 2001.

Asia has been no slouch either as China's swift reopening bolsters the economic outlook, with MSCI's broadest index of Asia-Pacific shares outside Japan up 11% in January at a nine-month high.

Oil climbs
Oil prices climbed in early Asia trade on Monday, supported by tensions in the Middle East following a drone attack in Iran and as Beijing pledged over the weekend to promote a consumption recovery which would support fuel demand.

Dollar cautious
The dollar firmed on Monday and distanced itself from an eight-month trough ahead of a slew of central bank meetings this week, including the Federal Reserve's, with traders keenly focused on guidance for the path of interest rate rises. The U.S. dollar index, which measures the greenback against a basket of currencies, rose 0.03% to 101.92, edging away from last week's eight-month low of 101.50.


FII/DII action
Foreign portfolio investors (FPIs) on Friday net sold Indian shares worth a whopping Rs 5,978 crore, provisional data showed. DIIs on the other hand, net bought shares to the tune of Rs 4,252 crore.

Stocks in F&O ban today
Ambuja Cements. Securities in the ban period under the F&O segment include companies in which the security has crossed 95% of the market-wide position limit.

Rupee: The rupee ended higher against the dollar on Friday, despite the sell-off in equities. The Indian unit closed at 81.5225 a dollar compared with 81.5900 a dollar on Wednesday.

Earnings
115 companies will detail December quarter earnings. Larsen & Toubro, Tech Mahindra, Punjab National Bank among the major ones.


FPO WATCH
The massive sell-off in stocks of Adani group last week has raised doubts over the smooth sail for the Rs 20,000-crore follow-on public offer (FPO) of Adani Enterprises. Reports on Saturday said that merchant bankers are mulling a cut in the offer price and extension of the sale date after the sharp fall in stock price. However, the company has clarified that the FPO remains on schedule at the planned issue price.


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