NIFTY NEARLY ACHIEVES 8190 TARGET; HEADED FOR 8220

NIFTY NEARLY ACHIEVES 8190 TARGET; HEADED FOR 8220

WORLD MARKETS                             

Dow and S & P 500 climbed 1% each while Nasdaq rose 1.3% yesterday with Nasdaq closing at record high as the Fed's dovish statement from Wednesday boosted investor sentiment amid the Greece debt talks.

Greece and its creditors failed to reach a cash-for-reforms deal yesterday during a euro group meeting of regional finance ministers. As a result, European Council President Donald Tusk said euro zone leaders will meet to discuss the impasse on Monday.

Greece is set to default on a 1.5 billion euro debt repayment to the IMF on June 30 unless it receives fresh funding from its creditors—the European Union, the IMF and the ECB. IMF Managing Director Christine Lagarde yesterday said that there is no possibility of delaying that deadline.

Back in the US, the May consumer price index (CPI) showed an increase of 0.4%, their largest increase in more than two years as gasoline prices surged. Weekly jobless claims came in at 267,000 for a larger-than-expected decline. The Philadelphia Fed index for June posted 15.2, above May's read of 6.7. Leading indicators for May showed an increase of 0.7 percent.

Dollar index touched a one-month low of 93.56 before closing at 94. U.S. 10-year Treasury yield held at 2.33%, off highs of 2.37%.

Nymex oil rose 53 cents to $60.45 a barrel. Gold jumped $25 to $1202 an ounce.

European markets gained 0.3%-1.1% on earlier hopes of a deal on Greece.

AT HOME

Benchmark indices soared a percent yesterday, extending the winning streak to fifth straight day and closing at the highest level since 2nd June. Sensex settled at 27116, up 283 points while Nifty climbed 83 points to end at 8175. BSE mid-cap and small-cap indices gained 0.8% and 1.1% respectively. Except a 0.2% each cut in BSE Realty and Metal indices, all the sectoral indices ended in green with Oil & Gas and Consumer Durable indices leading the tally, climbing 2.6% and 2.1% respectively.

FIIs net sold stocks worth Rs 785 cr but net bought index futures and stock futures worth Rs 145 cr and 1091 cr respectively. DIIs were net buyers to the tune of Rs 1110 cr.

Rupee appreciated 38 paise to end at 2-week closing high of 63.73/$.

OUTLOOK

Today morning Asian markets are trading with gains of upto half a percent and SGX Nifty is suggesting about 40 points higher opening for our market.

Readers would recall that we had recommended going long on Nifty in Wednesday's report once it sustains above 8070 for the target of 8160-8190.

In yesterday's trade, the benchmark touched a high of 8187 before closing at 8175, nearly achieving the 8190 target mentioned above and vindicating our view.

In yesterday's report we had mentioned that above 8190, 34-DMA, placed around 8220, would be the next hurdle to eye.

With today's gap up opening the benchmark would be closer to even that level. Once 8220 is taken out decisively, 200-DMA, placed around 8360, would be the next target.

Traders would do well to book some profit around 8220 and trail stop loss in remaining position to 8100, which is now the immediate support on the hourly chart.