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00:00 Hello and welcome. This is Samina Nalwala and you are watching the FNO Show, where we
00:15 take you through all the derivative action in the markets. A quick check on the market
00:21 this morning, the Nifty and the Sensex both trade flat after that massive rally we saw
00:25 on yesterday's day of trade. Bulls are taking a bit of a break in today's session. Bajaj
00:30 twins are under pressure but Agam is standing by with more details on the FNO action. Agam,
00:35 not surprised that we are taking a bit of a break after a very sharp run up in trade
00:39 yesterday. But what are the key factors that we are watching out for? Yes, absolutely Samina.
00:43 So for now, we are looking at the Bajaj-Fin twins, well perhaps to a certain extent weighing
00:49 down on the indices. But as far as the Nifty is concerned, it is absolutely flat. We are
00:53 looking at a little bit of positions building up around 1.3% in terms of open interest increase
00:57 towards index futures. But coming down to the Bank Nifty, that is where we are seeing
01:02 once again marginally in the red and not too much increase in OI there. Of course, in terms
01:07 of the options market, let's take a look at how things are changing. I reckon there won't
01:12 be a lot of changes when it comes to the options markets. And we should have an idea about
01:17 how things are panning out when it comes to your open interest. So this of course is your
01:21 open interest distribution and as we were pointing out earlier in the session that your
01:25 OI max put stands at around 21,500 and on the higher end we are seeing max call OI around
01:32 22,000 which gives you a rough range of about 500 points. In terms of today's day of trade
01:38 when it comes to the Nifty, we are looking at unwinding in the 21,700 put. Of course,
01:44 we are there about, so we don't have too much traction otherwise. But in terms of the Fin
01:50 Nifty, because it is the Fin Nifty expiry, we are currently, the Fin Nifty is currently
01:57 testing 20,300. Now that is a little bit of a worry because at the moment we are seeing
02:03 a lot of puts being written. But the question is that if we do see that particular level
02:11 being lost and if we do see the Fin Nifty move considerably below that mark, well there
02:16 could be some sort of a trouble as far as that options expiry for today is concerned.
02:22 That said, there is plenty of resistance offered around 2,500, 2,600. So we will continue to
02:28 keep an eye on a whole host of these levels. But let's talk about stocks then. Let's talk
02:33 about all those which are in fact in, we would focus on seeing an increase in open interest.
02:38 So Shorts building in, Bajaj Finance and Coromandel and Longs building in, Zee Entertainment,
02:43 caution, emphasis. And on the other hand, we have, well, stocks which are looking at
02:48 unwinding. So short covering in Cholam Mandalam, Hindustan Aeronautics, Ramco Cement, Piramala
02:53 Enterprises as well as GSW Steel. A lot of green, at least as far as short covering is
02:59 concerned and I reckon under the radar, beyond the benchmarks, that is what we are keeping
03:05 an eye on and that's perhaps is where we are seeing a little more strength as compared
03:09 to the benchmarks today, Samina. Indeed. Couple of sectors that are still doing quite well
03:13 today and which didn't participate as such yesterday is media, metals and IT. Let's take
03:19 you to the top gainers in the metal pack. You've got GSL that's up 5%, SAIL is trading
03:23 with a gain of 3%, Hindustan Copper, Nalco, Hindalco, Jingle Steel, Tata Steel, Hindustan
03:29 Zinc, that whole pack is trading with very, very solid gains across the board. So a strong
03:35 rally for metals is what we are picking up on. You've also got sharp gains coming in
03:39 for IT. So it may not look as euphoric as you'd have liked but a 1% gain on a day when
03:46 the markets generally aren't doing too well. Infi is up 2%, Core Forge is up a percent
03:51 and a half, Techminder, Persistent, Wipro are some of the other gainers in trade. Smaller
03:56 sector but worth a mention is how media stocks are doing this morning, 2.5% rally for media
04:00 counters. Zee is up 7%, Dish TV is up 4.5%, DB Corp, TV18, Sun TV, Nazara, NDTV are all
04:09 trading with very sharp rallies in morning trade. Well, but the breadth of the market
04:14 is flat. The WIX has seen a jump as well. So volatility continues to spike in today's
04:18 trade as well. We are joined by Vinay Rajani, CMT, Senior Technical and Derivative Analyst
04:23 at HDFC Securities and Richard Jain, CMT, Lead Research Analyst at S5 Pesa. Thank you,
04:29 gentlemen. Thanks for joining us this morning. Richard, I'll come to you first. On the Nifty,
04:34 what's the trade? After a sharp run yesterday, taking a bit of a breather in today's day
04:39 of trade. Would you initiate a strategy on the Nifty this morning?
04:43 Hi, very good morning to everyone. Well, if we look at the data, then the recent correction
04:50 of two weeks which we saw from the all-time high was mainly because of FISLA. But they
04:54 have rolled most of the short positions to the January series. And if you look at the
04:59 long-short ratio, then only 22% at the start of series on Thursday last week, only 22%
05:05 positions were on the shorts on the long side with net short positions of over 1,08,000
05:11 contracts. And these positions are usually considered short heavy. So short heavy in
05:16 the sense, in technical analysis, when we look at overbought or oversold zones, in derivatives,
05:22 we see such data as short heavy or long heavy. So whenever there are short heavy positions,
05:26 chances are there of short covering move and we witnessed some short covering by them yesterday.
05:31 So I think in the near term, because the positions are quite short heavy, then we could see some
05:36 short continuation of the short covering move. Now, 21,600 would be the important support
05:41 that I would watch out for till the markets are trading above 21,600. Possibility of some
05:45 pullback move would be there and 21,950, that would be the range where one can expect the
05:51 markets to resist again. So buy on dip should be the strategy for if you're looking from
05:55 a very short term trading 21,700 if you get. So ideally, I think one can look for buying
06:00 opportunity over there today, but not at current levels. At current levels, I'd look for more
06:04 of a stock specific trading opportunities because we can see that today, in spite of
06:09 the indexes are not much positive, but the market is quite healthy. So it's better to
06:13 trade with a stock specific approach for now. But in case if you get any dips towards that
06:17 21,650 to 21,700, then I think the risk reward ratio could become favorable to create fresh
06:24 strong over there.
06:25 Okay, that's the view coming in from Richard. But Vinay, good morning to you as well. Harvey,
06:30 you placed when it comes to the benchmarks. What are you doing?
06:33 Yeah, good morning and thanks for having me on the show. So yes, yesterday, after yesterday's
06:38 stellar move, we have seen some short covering in the Bank Nifty and Nifty has witnessed
06:43 a long build up in yesterday's session, almost 3% long build up was seen in the Nifty. So
06:47 Nifty is looking stronger as compared to the Bank Nifty. And if you were to look at the
06:52 put call ratio on first fab, the Nifty put call ratio has just reached to 0.92 as per
06:57 the yesterday's data. So previously it was 0.74. Now it reached to 0.92. So in considering
07:04 the yesterday's stellar move, put call ratio is not showing any overbought sign. So today
07:10 could be a breather day after stellar rally yesterday. But overall trend remains positive
07:14 because yesterday we saw downward sloping trend line breakout on the Nifty charts and
07:18 21,600 was the resistance. Now it is expected to act as a support going forward. So keeping
07:24 that stop loss in mind, one should remain long in the Nifty and I'm expecting that sector
07:28 rotation would continue to be there. Today, IT is showing strengths and in the coming
07:32 days IT could perform well because most of the large scale IT stocks came out with very
07:36 good results. So they consolidated in last few sessions and now they have started performing
07:41 now in the market. So I am of the opinion that today could be a breather day, but overall
07:45 trend remains positive. If you are a trader, Nifty can be bought at the lower level. Let's
07:50 say if you were to take a trade in Nifty, I would suggest buying Nifty Fab Future on
07:55 dips around 21,800. Stop loss can be kept at 21,700 and target for the short term remains
08:03 at 22,000. I would ignore going long in Bank Nifty because it is not showing strength.
08:08 No doubt short covering may come, but overall strength and data suggest that we should continue
08:12 to prefer Nifty for going longs and 22,000 is the ultimate target on dips. 21,800 is
08:19 the buying level at which traders can initiate fresh long positions.
08:23 Richit, I know you talked about Bank Nifty, but what are you doing with the Bajaj twins
08:28 today? Is there an opportunity for a trade on either sides?
08:32 I think it's more of a result based move that we have seen today. But many times we see
08:39 that whenever we see such huge gap ups or gap downs post such events and the follow
08:44 up moves are more important. The stock has already seen a correction recently. It's not
08:47 a one day correction which has happened in the stock. If you look at last, in fact, in
08:51 the entire January series, it has already corrected from that 7,800 levels to 16,900
08:57 levels now. So the risk reward ratio is not much favorable for creating fresh short positions
09:03 now. But since the data is not positive, I would better wait for the follow up move in
09:07 the stock and avoid any trades at current levels. If any existing long positions are
09:12 there, then the last two months the stock has formed a good support around 6,800. So
09:17 6,800 was the low in the month of August 2023 and even in the month of November, the lows
09:23 were around 6,900. So this range of 6,800 to 6,900 is a good support. So the risk reward
09:30 is not favorable for creating fresh shorts now post today's gap down opening. But 6,800
09:35 would be the pivotal level to watch for this month.
09:38 Well, I also want to take up Reliance Industries because of the sharp up move that we saw yesterday.
09:43 Of course, it made a new life high, closed a new life high yesterday. And today we are
09:46 looking at just a tad bit of profit taking coming through. It's still well above the
09:51 mark of 2850 as we speak. That's where the spot is. But Vinay, what's your view on Reliance
09:57 Industries? Do you think today's dip could be an opportunity to perhaps initiate more
10:02 moves? Yes, so for intraday traders it would be difficult. But yes, a dip should be bought
10:07 into because yesterday's move was significant with the rising volumes and overall pattern
10:13 on the weekly and monthly chart is quite good. If you were to look at the monthly gains in
10:17 this month, we have seen more than 10% rise in the stock like Reliance, which is a heavy
10:21 weighted index stock and looks very convincing on the charts if you were to see a weekly
10:26 and monthly setup. So weekly setup indicates that there is an inverted head and shoulder
10:30 pattern, which is a bullish pattern into a continuation. So if we take the pattern target,
10:36 it comes around 3100. It is a positional target, not for the short term traders or two, three
10:42 days traders. But if we take two, three weeks view, then I think Reliance is headed for
10:48 the next target of 3100 because overall trend is quite convincing. And after yesterday's
10:53 move, the pattern target comes in at 3100, which is an inverted head and shoulder. So
10:57 yes, buy on dip strategy should be there. 2800 is the immediate support for the stock
11:02 at which one can initiate fresh long positions.
11:05 Right. Richit, I want to come to you on the Adani Group stocks. Of course, fundamentally
11:10 the news flow is that recent upgrade coming from Cantor Fiscal. Today the stocks are taking
11:15 a bit of a break. But any of these Adani names that you would look to initiate a fresh long
11:21 at, at these levels?
11:22 I think a lot of volatility or ups and downs have been seen in last one year. Exactly in
11:30 January 2023, we saw that in Danburg news coming in, post which the stock went to a
11:35 sharp corrective phase. And again, most of the losses in some stocks have been recovered.
11:40 But if I look at the comparative analysis within the group, then two stocks within this
11:44 entire space, Adani Ports and Adani Power have stood out with a decent outperformance.
11:50 In fact, these were the first names to surpass its previous all time highs which these stocks
11:57 had formed in the month of January 2023. So I think the relative strength is clearly more
12:02 visible in Adani Ports and Adani Power. So if anyone is looking for taking any kind of
12:07 delivery buying in Adani Group stocks, then I think these two stocks should be preferred
12:11 over the other ones.
12:13 Of course, that's the view on Adani Group companies. And of course, we've already played
12:18 the standard disclaimer that the channel that you're watching is an Adani Group entity.
12:23 But we have more updates on the Sony Z, well, saga. It's no longer a merger, I guess. And
12:30 we have my colleague Tamanna who's joining us to tell us more. Tamanna, what else do
12:34 you have for us?
12:36 So tomorrow is when the arbitration will begin in the Singapore courts, in the Singapore
12:41 International Arbitration Centre. And that really is the news that is seeing the stock
12:46 zooming this morning. We always knew and we told you that this is going to turn into
12:52 a bitter battle from the boardroom to the courtrooms. And that now begins tomorrow.
12:58 What we're learning is that Z will be challenging a couple of things. First, the $90 million
13:04 penalty that Sony has imposed that will be challenged in the Singapore court, the SIAC.
13:10 They are also, as they have said in their public notice, going to demand that Sony does
13:16 go forward with the merger. They're going to challenge the terms of this termination
13:20 notice that Sony has put forth. The exciting bit, which is doing the rumours right now
13:26 is who the lawyers are going to be. I can't take names because I haven't revealed them
13:30 yet. But what's being believed is that you might be seeing a former Solicitor General
13:35 of India versus a former Attorney General of India on both sides of this very, very
13:41 big battle. Remember what's at stake here. What could have been one of the largest media
13:46 entities in India has now completely fallen apart. This happened on the 22nd of January.
13:52 And now you're very quickly seeing the next leg of that legal battle.
13:57 Of course, we'll continue to give you updates on the Sony Z saga. Tamanna, thank you so
14:03 much for getting us the latest in what's really happening there. But of course, we can do
14:09 it for now because the entertainment is rushing up ahead, is advancing by as much as six,
14:14 six and a half percent. Last time we checked, yes, it's advancing. But it's not at day's
14:18 highs, but well, it is certainly looking at a lot of strength. Well, on that note, we
14:22 slip into a short break. But on the other side, we talk about stocks and a lot of trading
14:26 ideas from our experts. Stay tuned.
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16:15 Welcome back. You're watching the FNO Show. The market's having a bit of a quiet morning.
16:19 No surprises there after the very sharp rally that we saw in trade yesterday. Bulls taking
16:23 stock of the current situation, 21,700 though is being respected on the Nifty. Lots of earnings
16:29 reactions, stocks like Mutthu Microfinance are up and about in trade. UTI Asset Management
16:34 looks great. Zee is having a positive day too. ONGC Cold India hit new life highs. So,
16:40 lots of action, but it's largely stock specific on back of earnings. Vinay, I'll come to you
16:45 with your top trade recommendations today. What are your top strategies that you're recommending
16:50 for our viewers? Yeah. So, I would go for the stocks which are showing strength and
16:55 trading near their 52-week highs and this sector is also supporting. So, for now, one
16:59 of the sectors is capital goods sector and Siemens is the stock which is looking strong
17:04 on the chart. So, I think Siemens can be bought. And yesterday we saw that 4250, which was
17:09 the crucial resistance, it surpassed that level and sustaining above that level now.
17:13 So, I think Siemens February future can be bought around 4330 is the current price. 4260
17:19 for the traders, I would suggest a stop loss. And on the upside, I'm expecting stock to
17:23 reach a target of 4490. So, first pick would be Siemens February future. Second pick is
17:28 from the NBFC space, Mannapuram Finance. So, Mannapuram Finance has broken out from the
17:33 narrow consolidation, which was there for last two, three weeks. And it seems that it
17:38 is a fresh breakout on the charts and can be utilized as a trading opportunities on
17:42 the long side. So, Mannapuram Finance February futures can be bought around 186. Stop loss
17:47 can be kept at 182. On the upside, I'm expecting a target of 193. So, time horizon for both
17:53 of the stocks and recommendation would be two to three sessions.
17:56 Right. Rachit, your trading ideas for today.
17:59 I have a trading idea in one of the metal name, which is Vindalco. Recently, the stock
18:04 has gone through some corrective phase. But if you look at the price volume action in
18:08 the cash segment, then there were no significant volumes on correction compared to the volumes
18:13 that we have seen during the price up move. Also, in the derivative segment, not much
18:17 of short portions are there in the system. Some amount of open interest built up has
18:21 been seen today along with the price up move. In the option segment, 580-600 call options
18:26 have seen good amount of overbuilt up, which indicates no buying happening in call options.
18:31 So, I think a move is expected in this series in Vindalco. One can go long with stock below
18:36 565, expecting short-term targets around 610.
18:40 We were discussing how the arbitration process will kick start for Zoninzi in Singapore tomorrow.
18:49 On the charts, how does Z look? It is trading with a gain of nearly 7%. Looks like a good
18:56 tactical trade. Rachit, that question is for you.
19:01 So, frankly, a bit difficult stock to analyze right now considering the stock has turned
19:07 a lot volatile because of the news flows which are going on. But if I look at the trend,
19:12 the trend is not positive in spite of today's pullback move of 6-7% which we have seen.
19:17 So I think the follow up move would be more important. So, volatility could continue based
19:21 on the news flows. But in a one day pullback move, I won't recommend going long over here.
19:28 Better to wait and watch for some follow up moves which could happen.
19:32 Vinay, a question for you on HDFC Bank. Do you think that at this point in time, the
19:38 dust has settled? Are you expecting consolidation on the stock? And if you are, do you think
19:45 that you would perhaps deploy a straddle or a strangle at this point in time on HDFC Bank?
19:51 Sorry, Agam, I would not be able to comment anything on this company. I am a group employee
19:56 and I will not be able to comment anything on it.
19:58 I totally understand that and I reckon that that's my bad. Rachit, can I take that question
20:03 with you?
20:04 Yeah, sure. So, short term trend is not positive as of now for HDFC Bank. Certainly, I think
20:11 long term investors can look for starting the investments over here and keeping in mind
20:16 that the major support for the stock would come around 1365 which could be tested in
20:21 the near term. So, I think from a short term perspective, still no signs of reversal. We
20:25 have seen that selling post its results and there are not much buying seen yet. So, 1365
20:31 I think could be seen in the going ahead. So, I won't recommend going long from a short
20:35 term trading perspective.
20:36 I think we have covered a whole bunch of names. I just want to quickly mark Epack Durables.
20:44 They listed on the exchanges this morning. Let's see what the stock is getting up to.
20:49 It was expected to see a gap up, but the stock is under pressure 6.5% on its very first day
20:55 of debuting on the exchanges. We have covered quite a few names, but just very quickly if
21:02 I can just get Richard in as well on IT names. Richard, we didn't talk to you about IT in
21:07 the sector. Richard, that sector is not doing too badly right now. Anything on Infi, Koforge,
21:12 Persistent, KPIT reports numbers as well tomorrow. Would you be looking to initiate a trade here?
21:18 So, yes, I think Infosys looks good within the IT space. Some consolidation has been
21:23 seen since last few days, but overall momentum still continues to remain positive. So, I
21:29 think in this volatile market, some of the IT large cap names could see some relative
21:34 outperformance. Infosys one can look for buying over here even 1700 call option if one has
21:39 to look for initiating longs to option segment. 1700 call options is right now trading around
21:44 40 rupees. One can initiate fresh longs with stop loss below 24 rupees and expect target
21:49 somewhere around 75 to 80 in these cities.
21:52 Vinay, the same question for you actually. The bulk of the earnings are behind us when
21:57 it comes to the IT space. Any interesting ideas in the information technology counters,
22:04 anything that you are spotting at the moment? So, as of now, as Ruchit said, Infosys setup
22:09 is looking convincing, results are already out. Most of the large cap stocks came out
22:13 with very good results, but right now technically Infosys looks the best and it has given breakout
22:20 from the consolidation which was there for last 3-4 sessions. So, I would go for the
22:25 Infosys first because it is leading as of now and the current price is 1685. So, keeping
22:30 a 2% stop loss, one can initiate a trade for the target of 4 to 5% on the upside in next
22:35 3-4 sessions. And I am expecting, in fact, I am expecting IT sector to perform well because
22:40 after result announcement they consolidated and again all set to go up from here. So,
22:45 I would suggest going long in Infosys first and then I will review other stocks. But Infosys
22:50 looks the best from the IT space. Right. Thank you. Thank you, Ruchit and thank
22:55 you for joining us as well. It was great to have both of you on our shows. We will hopefully
23:01 see both of you soon as well. In the meantime, we will take a quick break, but before we
23:05 call it a wrap on the show, in the next conversation with Sundar Raman, Ramamurthy, MD and CEO
23:10 at BSE, he talks about the change in people's outlook towards BSE and BSE's positioning
23:18 in the Indian market. Listen to that conversation.
23:22 Cash market has been there for a long period and there at some point of time BSE had a
23:28 significant market share. Somewhere around Jan 2023 when we joined, we found that the
23:34 market share has deteriorated a lot and come to a single digit. It was hovering between
23:40 5 to 6% at that point of time. And in respect of derivatives, which is a two decades plus
23:45 market in India, BSE had never had a steady volume or steady growth in the derivatives.
23:51 It was primarily led by LES, right, Liquidity Enhancement Schemes.
23:54 Correct. So, it was only Liquidity Enhancement Scheme which was sustaining it to some levels
23:59 and once it was very clear if the LES is withdrawn, the structure may not stand the test of time.
24:06 So, that was the situation in respect of these two. In respect of currency, the futures were
24:11 doing well and the options were not. Mutual funds we were doing good. So, this is what
24:17 we inherited in Jan 2023. If you look at it, we tried to make some product changes in the
24:25 cash market. There you cannot create any unique position for yourself, which we can talk about
24:30 later if you want. The most important area where we felt that we can position ourselves
24:35 and we can make a change, we thought was derivatives, equity derivatives. So, in equity derivatives
24:42 based on market feedback, we introduced or rather reintroduced two contracts with slightly
24:47 modified product specification and that looks to be working well. That is one reason why
24:53 the market has shown greater interest into BSE and it is working.
24:59 The most important point there is the way we are positioning ourselves is we are a complementary
25:05 exchange and we are not competing with anybody.
25:07 Thank you.
25:27 Thank you.
25:37 Thank you.
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