Sunday, April 02, 2017

Weekly Review 03.04.2017

Dear All,

The broader Nifty ended the fiscal with gains of 1,435.55 points, or 18.55%, after scaling the year’s high of 9,218.40 (intra-session) on March 17.

The index had lost about 9% in the previous fiscal, but had ended 2014-15 with gains of 26.65%.

GST :-

After months of discussions and several meetings, four goods and services tax (GST) supplementary bills finally got the Lok Sabha’s green signal on Wednesday. While the seven-hour-long debate was on, concerns were raised on many aspects of these bills—a significant one being the anti-profiteering clause. This clause requires businesses to pass on the benefit of input credit or tax reduction to the end consumer by way of a commensurate reduction in prices.

The objective of this move is to protect consumers from inflation after GST implementation. The implementation of GST has often led to some inflationary pressures in countries where this tax is already in place. But while the objective may sound simple, implementing an anti-profiteering clause is fraught with grave risks.

The biggest challenge, according to tax experts, is that of compliance. The government will have to ask for pre- and post-GST cost sheet of each product and calculate the pre-GST tax rate and post-GST tax rate for each and every item to understand the quantum of tax benefit that a supplier should get.

What corporates are also worried about is whether the anti-profiteering clause will result in witch-hunting by tax authorities. “The fear among corporates with respect to anti-profiteering is that it gives lot of power to the taxmen who may misuse it and harass taxpayers since a slew of indirect taxes will now be out of window and with that, their access to taxpayers would lessen.

To conclude, the anti-profiteering clause is yet another poorly thought-out attempt by the government to micro-manage businesses and may well lead to a bureaucratic nightmare. If implemented, it could have a severely deleterious effect both on business and on sentiment at the bourses.

RBI policy review: The Monetary Policy Committee (MPC) of RBI is scheduled to hold its second bimonthly policy review of the CY17 on April 5 and 6, wherein the central bank is widely expected to keep the interest rates unchanged.

Fed minutes: The minutes of the Federal Open Market Committee’s (FOMC) March meeting will be released on Wednesday (April 5). The US Fed raised the target range for its federal funds by 25 basis points to 0.75-1 per cent at its March 2017 review.

Economic Data: Markit Economics will announce the India Manufacturing Purchasing Managers' Index (PMI) data for March 2017 on Monday. The Nikkei Manufacturing PMI in India rose to 50.7 in February of 2017 from 50.4 in January 2017.

On the global front, Nikkei Japan Manufacturing PMI, Markit euro zone Manufacturing PMI and US Markit Manufacturing PMI for March 2017 will be released on Monday, which will show the health of the manufacturing sector in respective regions.

In addition, a couple of other events like consolidation of SBI branches and auto sales growth reports may also chart market direction in the coming week.

>>> Nifty Weekly Chart <<<

>>> click the chart to see on full screen <<<

Price to face its crucial resistance 9220 as per above chart. Since last three weeks - 9200 or 9220 is not crossed.

>>> Nifty Daily Chart - An Alternative Count <<<

>>> click the chart to see on full screen <<<

Above is an alternative count as 1-5. 5th wave might face its resistance @ 9200-9220 for 61.8% retrace. Cross above may trigger more rally.

>>> Nifty Hourly Chart <<<

>>> click the chart to see on full screen <<<

Key Resistance @ 9190 - 9200 - 9220 - 9240. Support @ 9100 - 9020 - 8968.

>>> Bank Nifty Daily <<<

>>> click the chart to see on full screen <<<

On Daily Chart - Price may find its resistance @ 22040.

>>> Bank Nifty Hourly Chart <<<

>>> click the chart to see on full screen <<<

Hourly Chart May Find its resistance @ 21650 - 21895 - 22040.

>>> GRANULES - Holding Short <<<

>>> click the chart to see on full screen <<<

Holding Short on Granules.

>>> MindTree - Holding Long <<<

>>> click the chart to see on full screen <<<

Holding Long and Looking for a good Pull Back.

>>> Performance for the month end of March, 2017 <<<

>>> click the image to see on full screen <<<

Above performance is not a Promise or guarantee for the given Profits or Loss.Performance given based on 1 lot at a time and clients Profit differ as per the margin availability and Number of Lots taken by them. We may or may not re-enter the Calls given here hit Stop Loss, as per market movement. The charts given above are just for educational purpose only and we don't recommend any Entry / Buy or Exit / Sell. Reader must taken their own decision or consult their qualified Analyst before making any decision.

>>> N4A - Services <<<