MID, SMALL CAPS PARTY WHILE NIFTY CONSOLIDATES; 8500 CONTINUES TO BE IMMEDIATE SUPPORT

MID, SMALL CAPS PARTY WHILE NIFTY CONSOLIDATES; 8500 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS

US indices gained between 0.2%-0.4% yesterday with the Dow and S & P 500 scaling record high amid encouraging economic reports.

Federal Reserve's Beige Book said the economy continues to expand. ISM services index beat expectations with a leap to a three-month high of 59.3 for November. U.S. nonfarm productivity grew a bit faster than initially thought in the third quarter. ADP report on private payrolls showed addition of 208,000 new jobs, which was a shade below expectations.

Energy sector topped the gainers helped by stabilization in oil prices and a report that showed a drop in oil inventories for the last week.

European markets, except a 0.4% cut in FTSE, gained between 0.1%-1.2% with Spain and Italy leading the tally. Eurozone composite PMI fell to 51.1 in November, marking a 16-month low and raising speculation that the ECB could unveil more monetary stimulus in the near future.

Dollar index touched five-and-a-half-year high at 88.63. Nymex oil rose 50 cents to $67.4 a barrel. Gold gained $9.3 to $1209 an ounce.

                                                             

AT HOME

Benchmark indices ended flat to marginally higher after a rangebound but choppy trading session. Sensex lost 1 point to settle at 28443 while Nifty finished at 8538, up 13 points. BSE mid-cap and small-cap indices however soared 1.4% and 1.6% respectively. BSE mid-cap index in fact closed at record high. Except a 0.2% each cut in BSE IT and Teck indices, all other sectoral indices ended in green with Auto and Realty indices leading the tally, putting on 1.3% each.

India's November HSBC Services PMI rose to 52.6 from 50 in October, marking a five-month high.

FIIs net bought stocks worth Rs 391 cr but net sold index futures and stock futures worth Rs 997 cr and 437 cr. DIIs were net sellers to the tune of Rs 157 cr.

Rupee depreciated 2 paise to end at 61.905/$.

Government will divest 5% in SAIL on Friday through OFS route.

OUTLOOK

Today morning Asian markets are trading with gains ranging from 0.5%-1% but SGX  Nifty is suggesting just about 10 points higher opening for our market.

For last two sessions, Nifty has been taking support in the vicinity of our indicated 8500 mark and that continues to be the immediate support a sustained trading below which would generate a sell on the hourly chart and would pave the way for the further correction till about 8430 and then to 8350.

8640 continues to be immediate target.

The European Central Bank holds its policy review later today, and while most economists don't expect any action, markets will be looking for indications that more stimulus could come early next year as the region's economic recovery falters.