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Markets may continue to be volatile this week ahead of F&O expiry

LiveMint logoLiveMint 25-09-2017 Nasrin Sultana

Mumbai: The markets are expected to remain volatile this week as military tension between North Korea and the US escalates. Traders are also expected to be cautious ahead of expiry of September series Futures and Options (F&O) on Thursday.

Jayant Manglik, president, retail distribution, Religare Securities Ltd said, “We believe that the volatility will remain high in the coming week as well due to several important data and events. On local front, the scheduled derivatives expiry on Thursday will keep traders busy throughout the week. Further, government will unveil macro-economic data of core sector figures and India’s budget balance on September 29. But above all, developments related to the lingering geo-political tussle will dictate the market trend,” he said.

According to Manglik, foreign institutional investors (FII) trend, monsoon update and currency movement will also remain on the participants’ radar.

So far this year FIIs sold $761.55 million worth of Indian equities in September. Domestic institutional investors have been net buyers this year. They have pumped in Rs8,837.76 crore in September and around Rs51,170.03 crore in 2017 so far.

According to Reuters, US Air Force B-1B Lancer bombers escorted by fighter jets flew in international airspace over waters east of North Korea on Saturday, in a show of force the Pentagon said demonstrated the range of military options available to President Donald Trump. The flight, which was disclosed shortly before North Korea’s foreign minister was due to address the United Nations, was the farthest north of the demilitarized zone separating North and South Korea that any US fighter jet or bomber has flown in the 21st century, the Pentagon said.

Mustafa Nadeem, CEO, Epic Research, feels it will be hard for bulls to have a comeback which was as swift as before as global tensions mount with North Korea pushing to a next level of tests with Hydrogen bomb. “Also we don’t see any cues that can lead us to a decline in volatility,” he added.

According to Nagaraj Shetti, technical research analyst at HDFC Securities, one may expect continuation of weakness in Nifty this next week and any upside recovery attempt from the immediate supports could attract selling interest from the highs. “Nifty is expected to slide down to the key lower levels of 9700- 9680 in the next two-three weeks,” he said.

In the primary markets, Construction firm Capacit’e Infraprojects will be listed on the exchanges today. The Rs400 crore initial public offering (IPO) which was open from 13 to 15 September was oversubscribed 183.03 times with a price band of Rs245-250 per share.

IPO of Prataap Snacks Ltd which opened for subscription on Friday was subscribed 43% on first day of share sale. With a price band of Rs930-938 per share, the Rs480 crore IPO will close on 26 September.

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