Opening Bell 15.09.2014

Your world at 9am

world.2014-09-15

Equities

Major
DAX(DEU) -0.41%
CAC(FRA) +0.02%
UKX(GBR) +0.11%
NKY(JPN) +0.25%
SPX(USA) -0.60%
MINTs
JCI(IDN) -0.37%
INMEX(MEX) +0.34%
NGSEINDX(NGA) -0.21%
XU030(TUR) -1.62%
BRICS
IBOV(BRA) -2.42%
SHCOMP(CHN) -0.34%
NIFTY(IND) +0.24%
INDEXCF(RUS) +0.61%
TOP40(ZAF) +0.08%

Commodities

Energy
Brent Crude Oil -0.64%
Ethanol -0.28%
Heating Oil -0.21%
Natural Gas +0.00%
RBOB Gasoline -0.68%
WTI Crude Oil -1.18%
Metals
Copper -1.11%
Gold 100oz -0.26%
Palladium +0.51%
Platinum -0.25%
Silver 5000oz +0.00%

Currencies

USDEUR:-0.03% USDJPY:-0.12%

MINTs
USDIDR(IDN) +0.54%
USDMXN(MEX) +0.07%
USDNGN(NGA) -0.75%
USDTRY(TUR) -0.06%
BRICS
USDBRL(BRA) +1.80%
USDCNY(CHN) +0.06%
USDINR(IND) -0.45%
USDRUB(RUS) +0.60%
USDZAR(ZAF) +0.24%
Agricultural
Cattle -0.78%
Cocoa +1.94%
Coffee (Arabica) -1.38%
Coffee (Robusta) +0.15%
Corn -0.52%
Cotton +0.35%
Feeder Cattle +0.32%
Lean Hogs -0.47%
Lumber +1.16%
Orange Juice -0.65%
Soybean Meal -1.00%
Soybeans -0.28%
Sugar #11 -3.83%
Wheat -0.60%
White Sugar -0.88%

Credit Indices

Index Change
Markit CDX EM -0.32%
Markit CDX NA HY -0.37%
Markit CDX NA IG +1.57%
Markit CDX NA IG HVOL +2.94%
Markit iTraxx Asia ex-Japan IG +0.05%
Markit iTraxx Australia -0.41%
Markit iTraxx Europe +0.26%
Markit iTraxx Europe Crossover -1.65%
Markit iTraxx Japan -1.37%
Markit iTraxx SovX Western Europe -0.08%
Markit LCDX (Loan CDS) -0.06%
Markit MCDX (Municipal CDS) +0.88%

Must reads

Tax authorities in Karnataka have stopped Amazon India from selling electronics and several other products from its warehouse in the state by cancelling the licences of third-party merchants that work with it. The Enforcement Directorate (ED) is also investigating Amazon India to find out if the company has sold products directly to customers and violated FDI laws. (LiveMint)

The Jharkhand government has closed down the uranium mine in Jaduguda – a mine that used to account for 25% of the raw material required for running the country’s 20 nuclear power reactors. (FE)

Gurgaon has unsold inventory of nearly 19 million square feet, 28% of the total area under development. (TOI, #real estate)

India is the world’s largest beef exporter. Maneka Gandhi thinks that the money from illegal animal slaughter is being used for terrorism. What’s her beef? (NDTV)

Keynes’ key to successful investing: He abandoned forecasting

Read an interesting article in the FT by Tim Harford about forecasting. Was hit by a couple of “aha moments”.

First:

Keynes’s track record over a quarter century running the discretionary portfolio of King’s College Cambridge was excellent, outperforming market benchmarks by an average of six percentage points a year, an impressive margin.

The secret to Keynes’s profits is that he abandoned macroeconomic forecasting entirely. Instead, he sought out well-managed companies with strong dividend yields, and held on to them for the long term. Keynes, the most influential macroeconomist in history, realized not only that such forecasts were beyond his skill but that they were unnecessary.

And here’s the other gem:

Most forecasters aren’t actually seriously and single-mindedly trying to see into the future. If they were, they’d keep score and try to improve their predictions based on past errors. They don’t.

This is because their predictions are about the future only in the most superficial way. They are really advertisements, conversation pieces, declarations of tribal loyalty…

Read the whole thing: How to see into the future

Weekly Recap: Sentiment Surveys are Pointless

world.2014-09-05.2014-09-12

Equities

Major
DAX(DEU) -0.98%
CAC(FRA) -1.00%
UKX(GBR) -0.70%
NKY(JPN) +1.78%
SPX(USA) -0.95%
MINTs
JCI(IDN) -1.41%
INMEX(MEX) -0.80%
NGSEINDX(NGA) -1.18%
XU030(TUR) -5.87%
BRICS
IBOV(BRA) -6.00%
SHCOMP(CHN) +0.24%
NIFTY(IND) +0.23%
INDEXCF(RUS) -1.01%
TOP40(ZAF) -1.13%

Commodities

Energy
Brent Crude Oil -3.51%
Ethanol -9.71%
Heating Oil -2.48%
Natural Gas +1.21%
RBOB Gasoline -2.27%
WTI Crude Oil -1.06%
Metals
Copper -1.90%
Gold 100oz -3.04%
Palladium -5.69%
Platinum -2.89%
Silver 5000oz -2.62%

Currencies

USDEUR:-0.03% USDJPY:+2.20%

MINTs
USDIDR(IDN) +0.54%
USDMXN(MEX) +1.54%
USDNGN(NGA) +0.29%
USDTRY(TUR) +2.98%
BRICS
USDBRL(BRA) +4.28%
USDCNY(CHN) -0.10%
USDINR(IND) +0.42%
USDRUB(RUS) +1.91%
USDZAR(ZAF) +3.06%
Agricultural
Cattle -2.17%
Cocoa +2.55%
Coffee (Arabica) -9.16%
Coffee (Robusta) -4.17%
Corn -4.10%
Cotton +8.16%
Feeder Cattle +1.57%
Lean Hogs +0.14%
Lumber +1.34%
Orange Juice -2.86%
Soybean Meal -1.17%
Soybeans +0.55%
Sugar #11 -8.18%
Wheat -6.71%
White Sugar -5.41%

Credit Indices

Index Change
Markit CDX EM -0.87%
Markit CDX NA HY -0.45%
Markit CDX NA IG +1.45%
Markit CDX NA IG HVOL +5.31%
Markit iTraxx Asia ex-Japan IG -0.61%
Markit iTraxx Australia -0.03%
Markit iTraxx Europe +2.98%
Markit iTraxx Europe Crossover +18.20%
Markit iTraxx Japan -1.67%
Markit iTraxx SovX Western Europe -1.04%
Markit LCDX (Loan CDS) +0.00%
Markit MCDX (Municipal CDS) +0.50%
It was a week when most markets went down but Indian mid-caps rallied like a cat with its tail on fire. Commodities: down, MINT markets: down, USD: up, credit: wide. Indian mid-caps: +3% to +10%.

Nifty Heatmap

CNX NIFTY.2014-09-05.2014-09-12

Index Returns

index performance.2014-09-05.2014-09-12

Sector Performance

sector performance.2014-09-05.2014-09-12

Advance Decline

advance.decline.line2.2014-09-05.2014-09-12

Market Cap Decile Performance

Decile Mkt. Cap. Adv/Decl
1 (micro) +11.06% 81/60
2 +12.97% 91/49
3 +11.06% 90/50
4 +7.52% 80/61
5 +10.47% 87/53
6 +6.29% 84/56
7 +5.64% 83/58
8 +4.40% 78/62
9 +3.14% 74/66
10 (mega) +0.79% 70/71
The action was in the lower end of the market-cap spectrum. The action in CNX 100/NIFTY was nothing compared to what happened in small/midcap stocks.

Top winners and losers

OFSS +9.72%
CIPLA +9.91%
ABIRLANUVO +12.84%
RANBAXY -6.74%
SUNPHARMA -6.03%
SAIL -5.75%
Sunpharma got dinged with an US-FDA inspection. No idea what happened to OFSS…

ETFs

PSUBNKBEES +8.22%
BANKBEES +1.94%
JUNIORBEES +1.31%
NIFTYBEES +0.21%
INFRABEES +0.18%
CPSEETF -0.43%
GOLDBEES -1.10%
Gold continued its tumble. Banks seem to have caught a bid…

Yield Curve

yield Curve.2014-09-05.2014-09-12

Bond Indices

Sub Index Change in YTM Total Return(%)
GSEC TB -0.40 +0.27%
GSEC SUB 1-3 -0.24 +0.81%
GSEC SUB 3-8 -0.17 +1.08%
GSEC SUB 8 -0.10 +0.88%
3-8 year part of the curve saw some action. But the last couple of weeks in the bond markets was as exciting as watching paint dry…

Nifty OI

nifty.puts.calls.SEP.2014-09-05.2014-09-12

Bank Nifty OI

bank-nifty.puts.calls.SEP.2014-09-05.2014-09-12

Theme Performance

Midcap value stocks shot ahead of the rest of the markets. We have three user contributed themes that are listed under ‘User Contributed Themes’ here.

Thought for the weekend

Sentiment data is inconclusive and sometimes contradictory. There is no signal within the noisy data. Besides, no one has the ability to consistently forecast any of the inevitable market corrections. Its probably best to ignore the short-term action and concentrate on being on the right side of the long-term trend.

Source: Buying Stocks Based on How Other People Feel

Options Daily 12.09.2014

Nifty OI

nifty.puts.calls.SEP.2014-09-10.2014-09-11

Bank Nifty OI

bank-nifty.puts.calls.SEP.2014-09-10.2014-09-11

Anomalous Option Trades

A sudden increase or decrease in open interest can signify informed buying/selling that you can potentially profit from. Option traders tend to ‘lead the pack’ and their actions can be used to gain insight into the consensus opinion of traders. This scan lists option trades that were one standard deviation away from the average over the last 20-days. Note that this scan maybe too noisy around expiry.

You can download the data here.

Check out our Option Strategy Studio. One more reason to open a demat account with us.