TECHNICAL TREND ( NIFTY - BANK NIFTY FUTURES )
NIFTY FIFTY : - The Nifty50 started on a cautious note with a flat trade in morning on Monday on the day of union budget 2016.The Nifty was trading at 7017 down 13 points or 0.18 per cent. It touched a high of 7,053 and a low of 7,006. The Nifty started flat on Tuesday but was still trading above its crucial support level of 7,000, weighed down by losses in oil & gas, consumer durable, capital goods, auto stocks. With India's price-to-book versus return on equity premium dropping below 40 percent for the first time since May 2015. In a super rally post Budget also boosted by strong Asian cues, the market is making mighty gains. The Nifty is up 500 points, Nifty Bank surges more than 1500 points from Budget day lows in two trading session. The Nifty50 reclaimed it crucial resistance level of 7,300 and was trading near its next crucial level of 7,350. FM Arun Jaitley pledge to maintain FY16 fiscal deficit target at 3.5 per cent of the GDP. The positive comes from Wednesday some anticipation of Policy easing by RBI amid positive global market. The Crucial Support for Nifty is 7370-7220 and the Resistance for Nifty is 7530-7680.

BANK NIFTY : - The Bank Nifty opened higher on Monday at 13818 up by 27 points or 0.2 %. Bank Nifty jumped 4.7% , on Tuesday the Banking stocks was top gainer. The Reserve Bank of India relaxed norms on tier-I capital relating to the treatment of certain balance-sheet items, including property, which will help PSU Banks unlock capital totaling about Rs. 35,000 crore. Bank Nifty opened with a terrific 3 per cent gain, which is really large for an index. We are headed further higher. On Wednesday Once again the interest rate sensitives like the banking and the auto stocks led the rally on hopes that the Reserve Bank of India is likely to announce reduction of interest rate.

NSE - WEEKLY NEWS LETTERS
TOP NEWS OF THE WEEK

Public sector banks wrote off over Rs 1.14 lakh crore in last 3 fiscals: Arun Jaitley - FM Arun Jaitley reportedly said that State-owned banks wrote off over Rs 1.14 lakh crore debt during the last three financial years."The public sector banks have written off Rs 1,14,181 crore of debt during financial years 2013, 2014 and 2015." Jaitley stated that in case of technical write-off, the recovery efforts continue as accounts remain the books of branches.

Union Budget 2016-17 is well aligned with PM’s‘Make in India ’ and ‘Startup India ‘ campaign - We believe the Union Budget 2016-17 is well aligned with Prime Minister’s ‘Make in India ’ and ‘Startup India ’ campaign. The budget focuses clearly on growth, development, job creation and creating a better environment for doing business in India. Besides a particular focus on startups by giving them exemption on their profits for the first three years is a welcome move. The relaxation in capital gain tax for investment in Funds of Funds and reducing the time frame to two years from three for availing long term capital gain tax benefit in the unlisted space will further boost the investment in startups. Also keeping the ‘Digital India ‘ momentum rolling during the budget, introduction of electronic auction platform for the private placement market in corporate bonds is a welcome move.

India Budget credit positive but uncertainties remain: Fitch - India's latest budget for the 2017 fiscal year contains a number of elements that could be positive from a sovereign rating perspective over the medium term, says Fitch Ratings. However, uncertainties regarding implementation of the reform agenda and meeting targeted revenue growth remain. Most notably, the budget for the fiscal year ending 31 March 2017. underscores the government's continued commitment to gradually broaden the ambitious reform agenda. Further reforms, such as those pertaining to the financial sector, agriculture and liberalisation of the FDI regime were announced in the latest budget, indicating that the government retains its vision of how to structurally improve the economy and create sustainable growth. Fitch maintains that improving the relatively weak business environment through structural reforms that would support investment and real GDP growth is a key factor that would be credit positive.

Sustained growth: India Feb Manufacturing PMI at 51.1 - The February Manufacturing PMI At 51.1 , unchanged from January reading, the seasonally adjusted Nikkei India Manufacturing Purchasing Managers Index–a composite single-figure indicator of manufacturing performance–pointed to a second consecutive monthly improvement in business conditions across the sector. Reflecting sustained growth of new work, Indian manufacturers raised their production volumes in February. That said, the rate of expansion eased since January and was marginal overall. Incoming new work increased for the second straight month and at the quickest rate since last September. According to survey members, underlying demand continued to improve. New business from abroad also rose, although February saw a loss of growth momentum. Manufacturing business conditions in India continued to improve.

Fiscal deficit of 3.5% is very credible step for the financial markets - The Union Budget 2016, presented today by the Union Finance Minister Mr. Arun Jaitley is a pragmatic and balanced act in the backdrop of global uncertainty. Maintaining a fiscal deficit of 3.5% is a very credible step for the financial markets, robust outlays for infrastructure, agriculture, rural and socio-economic schemes are also welcome moves, however, one can argue that more could have been provided for recapitalization of banks which are currently facing issues of mounting NPAs. Mr Jaitley once again relaxed the FDI policy in several sectors, including insurance and pension and asset reconstruction companies, to attract more overseas investments. The budget shows a lot of focus on rural areas and Infrastructure - arguably two important growth drivers for the economy.

Fund allocation of Rs. 2.31 lakh crore to enhance infrastructure base - The Union Budget 2016-17 is a step forward for the welfare of the people and growth in the country. For the infrastructure development the government has announced fund allocation of at Rs. 2.31 lakh crore that would aim to enhance the infrastructure base of the country. Guideline for renegotiation of PPP contracts is a long standing demand from international investors and will make the investment environment much more risk neutral. It is a big step towards overseas funding comfort for PPP in infrastructure. 228% higher grants to gram Panchayats & urban local bodies in accordance with FFC recommendations will augment development process significantly in terms of providing basic facilities like clean healthy water, sanitation, and other basic amenities leading to smart towns of future . This budget restores balance in Rural Bharat and India Inc. The approach of the Finance Minister is one of quantum jump rather than tinkering, which would accelerate the development process and put the Indian economy on a sustainable growth trajectory, while further expediting the “Make in India” programme and ‘Swaach Bharat Mission.


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