Onion prices crash 40% on bumper production

Prices of onions have collapsed on the back of two consecutive bumper production years, proving once again that when farmers grow more, they get less. According to government data, the wholesale modal onion prices at Lasalgaon in Maharashtra, the biggest trading centre for onion in India, dropped between 30-40 per cent after the November note ban. The cost of production of onion is around Rs 800-900 per quintal, while prices are hovering around Rs 500 per quintal across major wholesale markets. Onion prices have come down substantially at the retail level as well, during the past one year. Around January-February last year, onion prices were around Rs 20-22 per kg, against Rs 12-14 per kg at present. The prices are expected to remain low, as fresh arrivals of the crop continue till May 2017. Onion harvest generally takes place between September and May, divided into three seasons-pre-Kharif, Kharif and Rabi. Commodity Trading Tips

Notably, around 65 per cent of production is in the Rabi season, under which arrivals begin by April. Wholesale modal prices of onion at Lasalgaon ranged between Rs 450-500 per quintal in February 2017, against Rs 550-725 per quintal in January 2017. In early Novenber it was around Rs 850. In 2015-16, onion production was estimated to be around 20.21 million metric tonnes which was 11 per cent higher than the previous year. According to initial estimates by the government in July 2016, onion production in 2016-17 was estimated to be around 19.7 million tonnes, which is six per cent lower than the previous year. Notably, 2016-16 was a bumper onion production year. However, as compared to the past five year's average onion production, production in 2016-17 will still be about five per cent higher than normal. Increase in onion productivity has been one of the main reasons for rise in production. The average onion productivity increased to 17.32 tonnes per hectare in 2015-16, against 16.13 tonnes per hectare in 2014-15. Nifty Trading Tips 

Funds prepare $2 bn oil market play as supply tightens

Passive investment funds are poised to shift an estimated $2 billion from far-term to near-term crude futures over the next week, anticipating an energy market rally as a historic Organization of the Petroleum Exporting Countries  (Opec) output cut slashes supply. The switch may foreshadow the end of a global oil glut that built up during a two-year price war. On Friday — for the first time in six years — a rule in one of the most popular commodity market indices was triggered, requiring funds tracking the index to sell Brent crude futures contracts for December and to buy contracts for June . The S&P GSCI Enhanced Commodity Index rule aims to ensure that investors are positioned to cash in when oil market fundamentals change  in this case, when supply becomes so tight that the current price of oil becomes higher than the price of oil for delivery many months or years into the future. That structure is called backwardation. Future & Option Trading Tips

When markets are oversupplied, the opposite is true: It is cheaper to buy crude now than to buy it for delivery later. That structure is called contango. An S&P bulletin late Friday confirmed the rule had been triggered for Brent contracts. It stipulates that the funds must bring their money forward if the second and third month contract settles at a difference of less than 0.5 per cent on the third to the last day of any given trading month. On Friday, the Brent May contract price settled at $56.31 a barrel, while the June price settled at $56.55 a barrel. That would make the difference about 0.4 per cent.  The threshold was not breached for West Texas Intermediate crude. Investors will need to start the shift on March 1 and complete it over the next five business days, moving 20 per cent of their money each day. Two traders with knowledge of the indices told Reuters that they estimated that rule impacts between 35,000 and 45,000 Brent contracts. Each contract represents 1,000 barrels. So if those predictions prove true, about 40 million barrels, worth about $2 billion, will change hands. Astrology and Numerology Trading Tips 

Collateral managers start lending to intermediate agricultural players

Faced with falling volumes, especially in agricultural commodities, collateral managers empanelled with comexes have now moved beyond farmers and started financing intermediaries in the agri value chain through their NBFCs (non-banking financial companies). Banks have not tapped these areas of new businesses due to a lack of adequate collateral assets with the intermediaries. Almost all collateral managers, including National Collateral Management Services Ltd (NCML), Sohan Lal Commodity Management (SCML) and Star Agri have floated NBFCs for financing to agri intermediaries with an estimated lending potential of around ~90,000 crore. These intermediaries include small traders, farmers’ organisations (FPOs), agri processing units, and small and medium enterprises (SMEs). Sandeep Sabharwal, group chief executive officer, SCML, which finances the entire agri value chain, said, “Kissandhan Agri Financial Services (Kissandhan), a wholly-owned subsidiary of the SCML Group, has been offering agri financing solutions to farmers, joint liability groups, individuals, proprietary firms, partnership firms, SMEs, processors, millers, traders and all other agri intermediaries. Commodity Trading Tips

Kissandhan has changed the paradigm of collateral financing by providing loans purely based on agri collateral without any security and irrespective of the net worth of the borrower. SCML has turned the tables on others by offering finance against agri commodities as collateral without the need for any additional security.” Market surveys found banks giving agricultural loans on collateral and insisting on securities such as land, houses and vehicles. The turnaround time for issuing loans is 7-30 days and the financial statement of borrowers is considered to evaluate their credit worthiness. Sanjay Kaul, managing director and chief executive officer, NCML, said, "NCML provides procurement services and supply chain solutions (including finance) to bulk consumers, big end-users, exporters, processors and farmers. These end-to-end supply-chain solutions include testing and grading, procurement, storage and finance. Some of these customers earlier relied on local commission agents for procurement and using non-institutional lenders. Banks are not able to reach such customers on account of their low net worth and poor financials whereas NCML depends on the stock value and not the balance sheet of the entity.” Nifty Trading Tips 

156 multibaggers in a year; 27 stocks rally over 200%

As many as 156 stocks from the BSE 500 and small-cap index have surged an over 100% each in past one year, after a strong rally in equity markets. Of these, 27 stocks that includes Aptech, Lumax Industries, Vedanta, Indian Bank, Venky's India, Manappuram Finance, Escorts and Datamatics Global Services have appreciated over 200% since February 29, 2016 when the S&P BSE Sensex hit its 52-week low in intra-day deals. By comparison, the S&P BSE Sensex at around 28,743 levels has rallied 25% since then. On the other hand, the S&P BSE 500 index and the S&P BSE Small-cap index have rallied 32% and 43%, respectively. Financial Astrology Tips

Also Read: India will continue to be a stock picker's paradise: Porinju Veliyath

A strong inflow of more than Rs 85,000 crore collectively by the foreign portfolio investors (FPIs) and mutual funds in equities during the past one year has fuelled the market rally. That apart, an improvement financial performance by these companies for the trailing twelve-month (TTM) period ended December 31, 2016 is also partly responsible for increased investor participation in these stocks. Astrology and Numerology Trading Tips 

Also Read: BJP win in UP elections 2017 will be a trigger for markets: Samir Arora

While FPIs have made a net investment of Rs 46,952 crore, mutual funds have invested Rs 41,057 crore in equities, data show. As per sectoral classifications, around 17 stocks are from the chemicals and 15 from financial including banks. That apart, stocks of companies in the steel, pharmaceuticals, auto ancillary and cement sectors, too, have seen a good appreciation. Commodity Trading Tips

Improved performance

Out of 156 companies, 153 firms had posted more than doubled aggregate net profit of Rs 43,093 crore for the TTM ended December 2016 (TTM2016). These companies had profit of Rs 19,756 crore for TTM ended December 2015 (TTM2015). Thirumalai Chemicals - the largest gainer among these pack for instance - has seen its market value appreciate 537% to Rs 837. The company had reported a consolidated net profit of Rs 75.76 crore for TTM2016 against Rs 5.94 crore in TTM2015. Vedanta has rallied 266% from Rs 70.85 to Rs 259 after the company trimmed its consolidated net losses to Rs 7,448 in TTM2016. It had reported a loss of Rs 16,907 crore in TTM2015. Nifty Trading Tips 

Ajay Tyagi to take charge as Sebi chairman

Ajay Tyagi will take charge as the new chairman of the Securities and Exchange Board of India (Sebi) on March 1.The 59- year old Tyagi will replace UK Sinha, who has been at the helm of the securities market regulator for six years.Tyagi, who was an additional secretary, Department of Economic Affairs in the finance ministry, has been appointed for a period of three years. Tyagi is an Indian Administrative Officer (IAS) from the 1984 batch, Himachal Pradesh cadre. His only experience with capital markets has been as additional secretary in the North Block, a post he has held since October 2014. A number of bureaucrats who have worked with Tyagi say that he was expected to show good understanding of the markets and infuse new ideas in the system. Tyagi has to primarily complete the unfinished agenda of his predecessor Sinha, on issues like start-up listings and real estate investment trusts (Reits) which is yet to take off. He need to also finalise new rules on algorithm or high-frequency trading (HFT), cyber security, integration of Sebi with erstwhile commodity regulator Forward Market Commission (FMC), legal hurdles in launching option trading. Future & Option Trading Tips 

Trading hours: The clock runs longest in Singapore, shortest in China

Stock exchange in Singapore is open for trading from 9 am to 5 pm. With no lunch breaks, the market in Asia’s financial hub is open for eight hours, the longest among Asia’s major markets.  Meanwhile, the shortest trading hours are at Shanghai, China, data compiled by Bloomberg show. Despite short timings, Shanghai is mulling lunch breaks. The bourse had scrapped the break in 2011, a year when the Tokyo Stock Exchange and Hong Kong Exchanges & Clearing shortened their lunch hours. The Indian markets are open for trading for 6.5 hours between 9 am to 3:30 pm. In 2009, domestic bourses had extended trading by about an hour. Before that, markets used to open at 9:55 a.m. At present, between 9 and 9:15 am, markets conduct pre-open call auction session and the actual trading starts from 9:15 am. The so-called pre-open call auction session is aimed at better price discovery and reducing volatility.  Nifty Trading Tips

Mobius still bullish on Asian stocks

Asian equities have overcome uneven earnings, a resilient yen and Donald Trump to outpace global markets this year, and top investors including Mark Mobius say the rally has only just begun. For Mobius, it’s the lure of the region’s rising middle class, while lower valuations keep Alan Richardson at Samsung Asset Management Co bullish on a market that has more than three times the gains of the Stoxx Europe 600 Index this year and is also outpacing the record-setting S&P 500 Index. Mobius even has a plan for avoiding the fallout from any protectionist trade measures levelled at Asian nations by the Trump administration. “The outlook for Asian equity markets is very good compared to the rest of the world,” Mobius, executive chairman of Templeton Emerging Markets Group, which has about $24 billion under management, said by e-mail. “Economic growth numbers projected for the region are far above that of other parts of the world, particularly Europe and the US.” The firm is “excited” by an uptick in consumerism in Asia, he said.Behind their optimism is a clear calculation that the Asian growth story will persist. Home to the world’s fastest-expanding economies, the region is embracing the budding recovery in China, with mainland shares listed in Hong Kong leading Asian gains in 2017. Many strategists are encouraged by the latest earnings season, with Mobius expecting Asian profits to outpace the rest of the world as price growth returns and consumption rises. Asian stocks are the best placed globally to benefit from the build-up of asset reflation, as the region stands to benefit from US fiscal stimulus and recovering commodity prices, says Richardson, who helps Seoul-based Samsung Asset oversee about $173 billion. Commodity Trading Tips

Start buying

While the MSCI Asia Pacific Index has gained more than seven per cent this year, it trades at 17 times member company earnings, versus 22 times for the S&P 500 and 25 for the Stoxx Europe 600 gauge. “Asian markets are more attractive on a valuation basis with more cyclical operating leverage to global growth,” Richardson said. “I would start gradually accumulating Asian stocks because markets have already been consolidating for the past year and are starting to trend up.” Part of the reason behind Asia’s outperformance is recoveries in Japanese and developing-nation shares. Both are overcoming past issues that weighed them down last year, including a stronger yen and prospects for higher US interest rates. Astrology and Numerology Trading Tips

Radhakishan Damani prepares for DMart IPO

Whenever investor Rakesh Jhunjhunwala meets his mentor Radhakishan Damani, reports say, his favourite question is: “When are you listing your company?” As Avenue Supermarts, the company that operates the supermarket chain DMart, opens for an IPO on March 8, Jhunjhunwala’s wait will come to an end. It’s not only Jhunjhunwala who is looking forward to the listing of the company. Many other market players, too, are keenly watching it. There is a natural reverence amid market players about Damani. And for good reasons. For years, many fund managers and seasoned traders have followed the investments of “Mr White and White”, a nickname Damani earned due to his penchant for wearing white shirts and white trousers. Unlike the Bollywood director duo Abbas-Mustan, who are always spotted in similar attire at film functions or in media interviews, Damani has stayed away from the spotlight. For the uninitiated, Damani, 61, is one of the biggest names in the Indian stock market and ranked 98th on the Forbes India Rich List 2015 with a net worth of $1.15 billion. Much before Dmart happened, Damani was an ace stock market investor and mentor to Big Bull Jhunjhunwala. Future & Option Trading Tips

Kisan R Choksey, chairman of KRChoksey group, said: “Damani is known to look at fundamentals first as an investor and he chooses companies after proper due-diligence.” His strategy has been to identify and invest substantially in stocks that become multi-baggers, and he has the patience to wait for five to 10 years. Damani’s best investments include Gillette, VST Industries, CRISIL and 3M India. There are many stories to keep that legend intact. Two incidents specifically merit mention: In the early 1990s, when the original Big Bull, Harshad Mehta, kept taking the stock market to new heights on a daily basis, Damani had short positions in the market. Mehta and Damani kept on going in opposite directions till it was revealed that Mehta was siphoning off money from banks, and the markets crashed. Damani kept his nerve and came out on top. Just a few years later, he locked horns with Mehta again. This time, Mehta, in his new avatar as advisor, helped push shares of select companies like BPL, Videocon and Sterlite. Damani was again in the way. He shorted these stocks till the prices came crashing down. However, he wasn’t happy just winning. As Deena Mehta, managing director of Asit C Mehta Investment Intermediates and an industry veteran since 1984, said: “Even during this crisis, Damani was very helpful to traders in trouble. Even though he was heavily short in these shares, he allowed exit to brokers and traders who were long on these shares and sought his help.”Damani and Jhunjhunwala have taken many long-term bets together. Both have sizeable holdings in Aptech, CRISIL and Delta Corp. Financial Astrology Tips 

Nifty Midcap 100 index hits new high

Nifty Midcap 100 index hit its new high after a better-than-expected Gross Domestic Product (GDP) growth in the October-December quarter of the fiscal year 2016-17 (Q3FY17) stunned the Street. Nifty Midcap 100 index touched new high of 16,605, surpassing its previous high of 16,510 touched on February 22, 2017 during intra-day trade on the National Stock Exchange (NSE). Nifty Smallcap 100 index too hit a record high of 6,764 on the NSE in intra-day trade. Meanwhile, the S&P BSE Smallcap index hit a fresh nine-year high of 13,792 on the BSE in early morning trade on Wednesday. The index is trading at its highest level since January 8, 2008, when it touched a record high of 14,239 in intra-day trade. “The quarterly GDP growth for Q3 FY17 has exceeded the market’s expectations. The GDP growth for Q3 FY17 came in at 7% more than CARE’s estimation of 5.4% for this quarter,” CARE Ratings said. Commodity Trading Tips



The GDP estimates for Q3 2016-17 and 2016-17 as a whole indicate that despite demonetisation India’s economic growth trajectory remained fairly stable. The growth has come about due to higher tax buoyancy and higher government spending, it added. At 10:04 am; Tata Services Maharashtra (TTML), Dhanlaxmi Bank, Majesco, Neuland Laboratories, Jindal Saw and Prism Cement from the BSE Smallcap index have rallied more than 5% each. Sintex Industries, DLF, Union Bank of India, MRF and Apollo Hospitals from the NSE Midcap 100 index were up more than 2% each. Only two stocks – Bajaj Finserv from Nifty Midcap 100 and Gujarat State Fertilizers & Chemicals (GSFC) from the Nifty Smallcap 100 – hit their respective lifetime highs on the NSE. Balkrishna Industries, Finolex Industries, Minda Industries, Tata Metaliks and Nilkamal from the S&P BSE Smallcap index touched record highs. Nifty Trading Tips

Hedge funds raising exposure to commodities as prices rally

Hedge funds are raising their exposure to commodities as prices rally and investors respond to macro shifts, including the prospect of accelerating inflation under US President Donald Trump, according to Citigroup Inc. “After two years of scaling back exposure to commodities, the fund community finally appears to be growing interested in the sector again,” the bank’s analysts including Aakash Doshi and David Wilson wrote in an e-mailed note sent on February 27. They attributed record net-long positions, or bets that prices will rise, in markets including Comex copper and Nymex crude oil, at least partly to increased allocation of fund money. “Higher inflation expectations, particularly on the back of President Trump’s election, have bolstered the case for commodities as an inflation hedge or a bullish inflation wager,” the Citigroup analysts wrote. Commodities are also more attractive as a way to diversify a portfolio after becoming less correlated with other assets, according to the bank. Financial Astrology Tips 

 
The Bloomberg Commodity Index advanced 11 per cent last year, its first annual increase since 2010, with Citigroup predicting further gains in 2017. Steady demand growth in China, as well as signs of an end to years of structural oversupply in key commodities, are improving the broad outlook for prices. To be sure, the rush to go long on commodities may already have gone further than is justified by physical fundamentals, Citigroup said. On positioning in the Brent and WTI crude oil markets, “the math doesn’t quite add up” given prices are trapped in a tight range and there’s a consensus that US shale output will cap prices, the bank said. The latest net long position of 78,511 contracts for Comex copper on February 21 “looks extremely stretched compared to historical positioning,” even after retreating from a record high on January 31, the analysts wrote. Astrology and Numerology Trading Tips 

Sensex surges 200 points on surprise 7% Q3 GDP growth

Benchmark indices was trading higher in early-morning trade with Sensex surgind over 200 points tracking economy's surprise growth at 7% in the October-December quarter reducing fear of any major impact of PM Narendra Modi’s  surpeise demonetisation move. Though the Fiscal Deficit for April-January 2017 overshooting the Budget estimate for the full year capped the gains. At 9:46 am, the S&P BSE Sensex was trading at 28,968, up 225 points, while the broader Nifty50 was ruling at 8,935, up 56 points.In the broader market, BSE Midcap and BSE Smallcap gained 0.4% and 0.6% respectively. "Although immediate positive trend is intact but now only if Nifty sustains above 8,850 zones the upside rally may continue. Holding above 8,920 zone may take the index towards 9,000 then 9,050 levels but on the downside if it drifts below 8,850 then a further decline towards 8,800 and 8,740 zones may be seen," said Anand Rathi Technicals in a note. Commodity Trading Tips

Sectors and Stocks

Axis Bank, HeroMoto Corp, HDFC and ICICI Bank were the top gainers on BSE Sensex while Tata Motors was the biggest laggard, down 0.5% ahead of Feb Auto sales numbers. Tata Tele gained around 15% after Tata Sons and NTT Docomo proposed a resolution to the Delhi High Court on settling a dispute over the $1.17 billion due to the Japanese telco for exiting their joint venture, ending two years of public acrimony. HeroMoto Corp gained over 1.5% after the company informed bourses that a meeting of the board of directors is scheduled to be held on March 07, to consider declaration of interim dividend for the financial year 2016-17. Nifty Trading Tips 
 

Q3 GDP at 7% beats note ban blues

Gross domestic product (GDP) for the third quarter (Q3) of financial year 2016-17 (FY17) grew at 7%, allaying fears of any major effect of demonetisation though it was the lowest expansion in four quarters. The Q3 numbers not only made India the fastest-growing large economy in the world but also helped the Central Statistics Office (CSO) retain its earlier projection (in first advance estimates) for full-year GDP growth at 7.1% in the second advance estimates released on Tuesday. "Although impact of demonetisation looks muted on overall numbers due to changed base, it is more visible in financial sector which slumped to 3.1% YoY. Real GDP growth was 40 bps higher at 7.0% YoY. Importantly, capital formation as suggested by Q3 and Q4 data show a positive growth which contradicts the decline in government capital outlay and continued delayed in private capex," said Dhananjay Sinha, Head of institutional research, economist and strategist at Emkay Global Financial Services. Future & Option Trading Tips

India's steel exports register three-fold increase in January

India's steel exports registered a three-fold increase to 0.889 million tonnes (MT) in January this year, compared to the year-ago month. The massive jump in exports comes amid government providing extensive support to the domestic steel industry by way of various trade remedial measures including anti-dumping. The country shipped out 5.865 mt in the first 10 months of the ongoing financial year, registering an increase of 71 per cent. "Exports in January, 2017 (0.889 mt) was up 224 per cent over January 2016 and was up by 19 per cent over December 2016," according to Joint Plant Committee data. The country's steel export in January 2016 was 0.274 mt, the data further revealed. "Export of total finished steel was up by 71.1 per cent in April-January 2016-17 (5.865 mt) over the same period of last year," the data showed. Commodity Trading Tips 

Import of total finished steel declined by 37.8 per cent to 6.097 mt in April-January 2016-17 over the same period of last fiscal. Imports in January 2017 (0.602 mt) was down by 41.7 per cent over January 2016 and by 21 per cent over December 2016. India's consumption of total finished steel saw a growth of 3.5 per cent in April-January 2016-17 at 68.892 mt over same period of FY'16. During April-January 2016-17, crude steel production was 80.716 mt, registering a growth of 9 per cent over the same period of last fiscal. Overall crude steel production in January 2017 stood at 8.367 mt which was up by 11.5 per cent over January 2016 but declined by 0.4 per cent over December 2016. "SAIL, RINL, TSL (Tata Steel Ltd), Essar, JSWL (JSW Steel Lt) & JSPL together produced 45.18 mt during April-January 2016-17, which was a growth of 16.4 per cent compared to same period of last year," the data said. During April-January FY'17, hot metal production was at 53.598 mt, a growth of 10.5 per cent over the same period of last year. Nifty Trading Tips 

Gold prices hold near 3-1/2 month highs; Trump economic policy in focus

Gold prices held firm on Monday near 3-1/2 month highs hit in the previous session, with investors waiting for greater clarity on President Donald Trump's economic policy. Spot gold was little changed at $1,256 per ounce at 0340 GMT. The metal hit its highest since Nov. 11 at $1,260.10 in the previous session. U.S. gold futures were also steady at $1,257.30. "The biggest driver of gold has been the relatively weak U.S. dollar. People think that ... Trump doesn't want a strong dollar and the market thinks that perhaps there would not be a rate hike in the first half of the year," said Jiang Shu, chief analyst at Shandong Gold Group. Investors are looking towards Trump's policy speech to a joint session of Congress on Tuesday night where he is expected to provide clues on his plans to cut taxes. Future & Option Trading Tips

"The momentum has its own driving force," said Shu. "Since the beginning of the year, the gold price has always been on the rise. This will draw more and more momentum traders into the market."Hedge funds and money managers raised their net long position in COMEX gold to the highest in nearly three months during the week to Feb. 21. Speculators raised their net long position in bullion by 14,482 to 82,464 lots. "It also means that market sentiment is generally on the bullish side," Shu added. Holdings of the largest gold-backed exchange-traded fund, New York's SPDR Gold Trust, have risen more than 5 percent this month. Spot gold is expected to rise to $1,278 per ounce, as it has more or less broken above resistance at $1,249, according to Reuters technical analyst Wang Tao. "We have a plethora of Federal governors speaking this week, including Janet Yellen, which should give the Street a lot more visibility into whether March's FOMC is live," said Jeffrey Halley, senior market analyst at OANDA.  Financial Astrology Tips

FCI stares at storage space shortage

Storage issues might resurface at Food Corporation of India (FCI) after two years of low grain procurement as the target for rabi wheat purchase this year has been increased sharply. The food ministry in a statement on February 15 set a 33 million tonne wheat procurement target for the season beginning April, a jump from the previous year’s procurement of 22.96 million tonnes. While the target is for the entire year, much of the procurement happens between April and June. Government agencies, including FCI and state government warehousing companies, have procured 43.71 million tonnes of paddy by February 15. Also, FCI in association with the Small Farmers’ Agribusiness Consortium (SFAC) and National Agricultural Cooperative Marketing Federation of India (Nafed) has for the first time procured 1 million tonnes of pulses till February 15. Commodity Trading Tips

“The government has directed us to procure pulses at the minimum support price in various locations. It has also increased our wheat procurement target by 10 million tonnes. We will need additional storage space this year.  FCI may hire private warehouses,” said an FCI executive. Last year, a large number of warehouses remained empty due to low procurement. “But hiring private godowns will depend upon purchases by multinational grain companies. If prices remain higher than the MSP, multinational companies might procure more grain. But FCI is planning to procure 25.5-28.5 million tonnes of wheat this year, which will start by March,” said another FCI executive. FCI has increased its storage facilities by a third in six years to 81.48 million tonnes. Central Warehousing Corporation, State Warehousing Corporation and private investors have additionally built 13.34 million tonnes of storage under the private entrepreneurs guarantee, of which FCI has taken over 12.74 million tonnes. Private investors under the aegis of FCI have also built 0.5 million tonnes of silos. Nifty Trading Tips

Onion prices crash 40% on bumper production

Prices of onions have collapsed on the back of two consecutive bumper production years, proving once again that when farmers grow more, they get less. According to government data, the wholesale modal onion prices at Lasalgaon in Maharashtra, the biggest trading centre for onion in India, dropped between 30-40 per cent after the November note ban. The cost of production of onion is around Rs 800-900 per quintal, while prices are hovering around Rs 500 per quintal across major wholesale markets. Onion prices have come down substantially at the retail level as well, during the past one year. Around January-February last year, onion prices were around Rs 20-22 per kg, against Rs 12-14 per kg at present. Financial Astrology Tips

The prices are expected to remain low, as fresh arrivals of the crop continue till May 2017. Onion harvest generally takes place between September and May, divided into three seasons-pre-Kharif, Kharif and Rabi. Notably, around 65 per cent of production is in the Rabi season, under which arrivals begin by April. Wholesale modal prices of onion at Lasalgaon ranged between Rs 450-500 per quintal in February 2017, against Rs 550-725 per quintal in January 2017. In early Novenber it was around Rs 850. In 2015-16, onion production was estimated to be around 20.21 million metric tonnes which was 11 per cent higher than the previous year. According to initial estimates by the government in July 2016, onion production in 2016-17 was estimated to be around 19.7 million tonnes, which is six per cent lower than the previous year. Notably, 2016-16 was a bumper onion production year. However, as compared to the past five year's average onion production, production in 2016-17 will still be about five per cent higher than normal.Increase in onion productivity has been one of the main reasons for rise in production. The average onion productivity increased to 17.32 tonnes per hectare in 2015-16, against 16.13 tonnes per hectare in 2014-15. Astrology and Numerology Trading Tips

India gold hits 4-month high on firm global cues

Gold prices soared by Rs 325 to regain the Rs 30,000-mark and trade at over four-month high of Rs 30,175 per 10 grams at the bullion market on Saturday, amid a firm overseas trend and wedding season buying by jewellers. Gold prices had touched Rs 30,325 per 10 grams on October 18, 2016.

Silver, too, followed suit and surged by Rs 600 to Rs 43,800 per kg on increased offtake by industrial units and coin makers. Bullion traders said sentiment got a boost after gold climbed in the global markets, as weakness in the dollar pushed up demand for precious metals as safe-haven. Globally, gold rose 0.61 per cent to $1,256.90 an ounce, a level last seen in November last year, and silver rose 0.99 per cent to $18.33 an ounce in New York in Friday trade. Nifty Trading Tips

Besides, increased buying by local jewellers, triggered by ongoing wedding season demand also supported the upmove, they said. In the national capital, gold of 99.9 and 99.5 per cent purity rose by Rs 325 each to Rs 30,175 and Rs 30,025 per 10 grams respectively, a level last seen on October 18, 2016. Sovereign, however, remained flat at Rs 24,500 per piece of eight grams. Following rally in gold, silver ready also registered a sharp rise of Rs 600 to Rs 43,800 per kg and weekly-based delivery recaptured the Rs 43,000-mark by rising Rs 760 to Rs 43,350 per kg. Silver coins, too, spurted by Rs 1,000 to Rs 74,000 for buying and Rs 75,000 for selling of 100 pieces. Future & Option Trading Tips

Nifty outlook and three trading ideas by Chandan Taparia of MOSL

Outlook

Nifty index managed to hold 8,800 zone and witnessed sustain buying interest till the end of session. It continued its higher top-higher bottom formation and respecting its major support trend line by connecting the bottoms of 7,893 and 8,327. It formed a Bullish candle on daily chart and supports are shifting higher from 8,720 to 8,800. Until it holds above 8,820 zone, this rally may extend towards 8,968 and 9,000 while on the downside multiple supports are seen near to 8,820 and 8,750. Commodity Trading Tips

Nifty target to be expected between 9,120-9,150 in short term: Devang Shah

NIFTY
 
CLOSE- 8939.50 (23.02.17) Nifty closed fifth consecutive week in positive territory. It extended further on upside & achieved short term targets levels as expected last week. It made a high of 8,982.15 levels on Nifty so far in this rally. It’s showing loss of momentum at the end of expiry day. Traders also booked profit from higher levels ahead of long week end holiday at the end of expiry. It’s still trading in parallel channel as per daily chart of nifty. It can still further stretch till upper end of channel towards revised short term targets levels as mentioned below till short term reverses. 8,780 levels are strong support & lower end of channel to watch out for as per daily charts in short term, break of these support levels will finally confirm further   profit booking in short term. Therefore, Trader should be very stock specific & light at current levels of market. Nifty Trading Tips

Short term outlook for the market remains positive till Nifty trades above 8,680 levels & expecting targets in the range of 9,120-9,150 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 8,327 levels & expecting target of 10,000 levels on Nifty in medium term. BANK Nifty also trending in parallel channel as per daily chart attached.  It has also achieved my short term targets levels near recent high as expected earlier. It made a high of 21,024.60 levels so far in this rally. It can further stretch further till upper end of channel till 21,600 levels till it holds 19,970 levels in short term as per chart attached. 20,380 levels is strong support & lower end of channel in short term, break of it will finally confirm further profit booking in short term. Trader should partial book profit & trail rest with trail stop loss levels at current levels of market for short term.
Broader market BSE MIDCAP & SMALL CAP is also outperforming so far in this rally. It’s also trading in wave-V as per daily chart attached. One should also watch out these indices behaviour for taking short term clue of market. Future & Option Trading Tips

Transformers and Rectifiers gains on order win of Rs 153 crore

Transformers and Rectifiers (India) was up 8% to Rs 420 on BSE in intra-day trade after the company said it has received order worth Rs 153 crore from Gujarat Energy Transmission Corporation Limited (GETCO). "The said order falls under the normal course of business. The company neither has any interest in the entity that awarded the order nor fall within related party transactions," company said in release. With this order, the company’s order book as on date stands around Rs 1,020 crore, it added. At 10:02 am; the stock was up 4% at Rs 406 on BSE as compared to 0.15% rise in the S&P BSE Sensex. A combined 212,349 shares changed hands on the counter on the BSE and NSE so far. Commodity Trading Tips

Funds prepare $2 bn oil market play as supply tightens

Passive investment funds are poised to shift an estimated $2 billion from far-term to near-term crude futures over the next week, anticipating an energy market rally as a historic Organization of the Petroleum Exporting Countries  (Opec) output cut slashes supply. The switch may foreshadow the end of a global oil glut that built up during a two-year price war. On Friday — for the first time in six years — a rule in one of the most popular commodity market indices was triggered, requiring funds tracking the index to sell Brent crude futures contracts for December and to buy contracts for June . The S&P GSCI Enhanced Commodity Index rule aims to ensure that investors are positioned to cash in when oil market fundamentals change  in this case, when supply becomes so tight that the current price of oil becomes higher than the price of oil for delivery many months or years into the future. That structure is called backwardation. Future & Option Trading Tips

When markets are oversupplied, the opposite is true: It is cheaper to buy crude now than to buy it for delivery later. That structure is called contango. An S&P bulletin late Friday confirmed the rule had been triggered for Brent contracts. It stipulates that the funds must bring their money forward if the second and third month contract settles at a difference of less than 0.5 per cent on the third to the last day of any given trading month. On Friday, the Brent May contract price settled at $56.31 a barrel, while the June price settled at $56.55 a barrel. That would make the difference about 0.4 per cent.  The threshold was not breached for West Texas Intermediate crude. Financial Astrology Tips

Investors will need to start the shift on March 1 and complete it over the next five business days, moving 20 per cent of their money each day. Two traders with knowledge of the indices told Reuters that they estimated that rule impacts between 35,000 and 45,000 Brent contracts.Each contract represents 1,000 barrels. So if those predictions prove true, about 40 million barrels, worth about $2 billion, will change hands. “This is just another reason to be very bullish” about oil prices, said one trader involved with the deals, who spoke on condition of anonymity. Astrology and Numerology Trading Tips

Sensex trades flat, Nifty below 8,900 ahead of Q3 GDP data

The benchmark indices on Tuesday continued to trade flat even as Asian markets were trading higher after US president Donald Trump said he would make a "big" infrastructure statement on Tuesday. Back home, investors also await December quarter GDP data due later in the day, which is estimated to come in at 6.4% year-on-year. At 11:07 am, the S&P BSE Sensex was trading at 28,821, up 8 points, while the broader Nifty50 was ruling at 8,893, down 3 points. In the broader market, the BSE Smallcap index outperformed the frontline indices to rise 0.4%, while the BSE Midcap was little changed. "For the coming session, 8,880-8,850 would act as a strong support; whereas, on the upside, 8,931-8,982 would be seen as an immediate hurdle for the index. We would expect continuation of the consolidation phase within the range of 8,982-8,826 before resuming the higher degree up trend," said brokerage Angel Broking. Nifty Trading Tips

RIL up 4.7% after target price raised

Shares of Reliance Industries Limited (RIL) gained as much as 6.5 per cent  on Monday after global brokerage Morgan Stanley raised its 12-month target price by 17 per cent to Rs 1,506. Shares of RIL closed at Rs 1,238.6, up Rs 56 or 4.74 per cent. The target price given by Morgan Stanley is close to 21 per cent higher than the current share price of RIL. This rally on Monday took the total surge in the stock to 13.7 per cent since February 21, when the Mumbai-based company announced its rate plans for its newly found telecom subsidiary Reliance Jio. The rally has also propelled the company to cross Rs 4-lakh-crore market capitalisation (m-cap). At Monday’s close price, the m-cap of Reliance is Rs 4.01 lakh crore, the second most for an Indian company after software gaint Tata Consultancy Services (TCS), Rs 4.9 lakh crore. Astrology and Numerology Trading Tips

In the report, Morgan Stanley said RIL had underperformed its peers in the last four years by 60 percentage points and the trend would change now as it starts to realise its earning from both energy projects and telecom venture.  The report also said, after nearly doubling its energy business investments in the past four years, RIL’s energy earnings are poised to benefit from slowing oil oversupply, a rising global gas glut, and the start of a polyester upcycle. "We think the ability to leverage these trends sets RIL apart from its global peers and drives our conviction that energy earnings can beat consensus (estimate) by 12-23 per cent," Morgan Stanley report said. On February 21, RIL had announced its rate plans for Reliance Jio starting April 1. Until now, the services offered by Jio have been free of cost. During the announcement, Mukesh Ambani, chairman, RIL, said Jio had crossed 100-million customer mark. Commodity Trading Tips 

 

Markets start March series with a fall, Trump speech looms

Stock markets showed weakness on the first session of the new derivatives series on Monday, with the BSE Sensex slipping 80 points to 28,813, as investors chose to sit tight ahead of a speech by US President Donald Trump before the Congress this week. The benchmark indices closed lower for the first time in last seven trading sessions, weighed down by banking, auto, power, PSU, capital goods, technology and metal stocks. The NSE Nifty also cracked below the 8,900-mark. The selling came in the face of start of March futures and options series in the derivatives segment, dealers said. Despite opening higher, the 30-share Sensex stayed in the negative zone for the most part and touched a low of 28,791.19 as investors booked profits in recent gainers. The gauge settled down 80.09 points, or 0.28 per cent, at 28,812.88. Commodity Trading Tips

The index had gained 737.41 points in the previous six sessions. The 50-share NSE Nifty ended lower by 42.80 points, or 0.48 per cent, at 8,896.70, after touching a high of 8,951.80 and a low of 8,888.65. "Market oscillated between gains and losses and finally settled in the red as the higher valuation overruled any exuberance for further upside. Additionally, market is awaiting Q3 2016-17 GDP data on Tuesday," said Vinod Nair, Head of Research, Geojit Financial Services. Axis Bank crashed the maximum, down 3.56 per cent, followed by PowerGrid 3.14 per cent and Bharti Airtel 2.83 per cent. Other losers were ICICI Bank 1.97 per cent, Maruti Suzuki 1.38 per cent, L&T 1.20 per cent, Dr Reddy's 1.12 per cent and Tata Motors 1.02 per cent. However, market heavyweight RIL soared 4.74 per cent to Rs 1,238.60. Last week, its telecom arm Jio had said it would start charging for data services from April, thus providing clarity on the way forward. Nifty Trading Tips 

Tata Sons to raise Rs 2,000 cr through debentures

Tata Sons Limited, a principal holding company of Tata group, is planning to raise Rs 2,000 crore through non-convertible debentures (NCDs) to support business operations. The rating “AAA” for NCDs reflects Tata Sons' exceptional financial flexibility and strong financial risk profile, supported by the company's comfortable liquidity and a sound capital structure, CRISIL said in statement. These rating strengths are partially offset by Tata Sons' increased participation in Tata group companies' investment programme. Its business risk profile will also depend on the success of these investments. The Tata group has been expanding its business presence through both organic and inorganic means, resulting in large funding requirements across group companies. Tata Sons' financial flexibility arises from its ability to raise additional funds by sale or pledge of its large portfolio of investments, mainly equity shares in Tata Consultancy Services Ltd (TCS). As on February 23, 2017, the 73.26 per cent holding in TCS had a market value of more than Rs 3.5 lakh crore. Future & Option Trading Tips

On February 21, 2016, the software services company announced a buyback of shares worth Rs 16,000 crore. Under the programme, TCS will repurchase 56.1 million shares (2.85 per cent of its equity) at Rs 2,850 apiece. The company has comfortable liquidity and a sound capital structure. It remains adequately resourced, which together with regular dividend income primarily from its holding in TCS provides high cash flow adequacy for debt servicing. As on September 30, 2016, the cash and cash equivalent was around Rs 4,200 crore. In financial year 2016, profit after tax (PAT) was Rs 3,010 crore on total revenue of Rs 8,100 crore. The PAT for financial year 2015, was Rs 9,060 crore on total revenue of Rs 13,210 crore. In six months of financial year 2017 (ended September 2016), PAT was Rs 5,080 crore on total revenue of Rs 7,603 crore. Referring to the recent appointment of N Chandrasekaran as executive chairman of Tata Sons, CRISIL said that there is no immediate impact on the business and financial risk profile of Tata Sons or any of the group companies (rated by CRISIL) due to the change of chairmanship. Prior to moving to Tata Sons, Chandrasekaran was chief executive and managing director at TCS. Financial Astrology Tips