CHINESE DATA BOOSTS ASIAN MARKETS; NIFTY ON TRACK TO ACHIEVE 8627 TARGET

CHINESE DATA BOOSTS ASIAN MARKETS; NIFTY ON TRACK TO ACHIEVE 8627 TARGET

WORLD MARKETS                             

US markets were shut yesterday for the Martin Luther King Jr. Day.

European markets ended with gains ranging from 0.6%-1.2% with Spain and Italy leading the tally. Shares in several Italian cooperative banks shot up after press reports suggesting the government could change rules regarding shareholder voting rights.

Brent crude fell nearly 3% or $1.33 to $48.84 after Iraq announced record oil production and the global economic outlook darkened. Nymex oil fell $1.11 to $47.58 a barrel.

AT HOME

After a gap up opening, benchmark indices traded in a range for the rest of the session and finally ended higher by nearly a fifth of a percent, extending the winning streak to third straight day and closing at the highest level since 4th December 2014. Sensex gained 140 points to settle at 28262 while Nifty finished at 8551, up 37 points. BSE mid-cap and small-cap indices gained 0.4% and 0.8% respectively. Except a 0.7% cut in FMCG index and marginally lower IT index, all other BSE sectoral indices ended in  green with Consumer Durable index leading the tally with a 3.4% gain, followed by 1.2% each rise in Capital Goods and Healthcare indices.

HUL tumbled after company's topline and volume growth disappointed. Revenues rose 7.6% to Rs 7774 cr, the expected figure being Rs 7963 cr. Volume growth stood at 3% as against expectation of 5-6%. Net profit jumped 17.9% to Rs 1252 cr but was boosted by income from land sale.

FIIs net bought stocks, index futures and stock futures worth Rs 434 cr, 56 cr and 92 cr respectively. DIIs were net sellers to the tune of Rs 238 cr.

Rupee appreciated 16 paise to end at 61.71/$.

OUTLOOK

China's 4th quarter GDP growth has come in at 7.3% same as that in the previous quarter but above the forecast of 7.2%. December industrial output is up 7.9% vs November's 7.2% growth and estimate of 7.5% uptick. December retail sales have grown 11.9% vs 11.7% estimated.

Asian markets are trading with gains ranging from 0.5%-1.5% and SGX Nifty is suggesting about 25 points higher opening for our market.

Just to reiterate, we have been positive on Nifty ever since a buy was generated on hourly chart when 8300 was crossed. We had also mentioned that a crossover of 8446 would mark a breakout on the daily chart, upon happening of which, 8627 would be the next target.

Nifty is on track to achieve 8627 target. Immediate support on the hourly chart has moved up to 8430, with the stop loss of which trading longs should be held on to.

Also, when Nifty closed above 8446 on last Thursday, we had mentioned that a breakout from a symmetrical triangle formation has occurred, the target of which comes to around 9000 and can materialise over next 6-8 weeks. 9000 continues to be next major target above 8627.

Kotak Mahindra Bank will report its quarterly earnings today.