STAY LIGHT ON ACCOUNT OF LOOMING HURDLE, GREEK REFERENDUM
US indices ended marginally lower ahead of a long weekend, eying a soft jobs report and awaiting outcome of Greece's Sunday referendum.
US economy added 223000 jobs in June, slightly missing expectations for an addition of 230,000 jobs. Unemployment rate stood at 5.3%, but was lower due to sharp fall in labor force participation to its lowest level since October 1977. Hourly wages for June were unchanged. May's figures were revised lower, down to 254,000 jobs from 280,000 and wage growth of 0.2%.
In other economic news, weekly jobless claims came in at 281,000, while factory orders for May showed a 1% decline.
Greek Prime Minister Alexis Tsipras has been urging his country to reject the bailout in a "no" vote that could accelerate the country's exit from the euro zone. Greek finance minister Yanis Varoufakis stated he and several other members of the Syriza party will resign if the 'Yes' vote wins, meaning a new Greek election will be a likely outcome.
The International Monetary Fund yesterday warned in the preliminary draft of its latest debt sustainability report that Greece would need an extension of its European Union loans and a large debt write-off if it grows more slowly than expected and economic reforms are not implemented.
European markets, except a 0.3% higher FTSE, lost 0.6%-1.4%.
Earlier Shanghai Composite closed 3.5% lower despite a relaxation in rules on using borrowed money to invest.
Benchmark indices ended modestly lower after a rangebound but choppy trade, breaking two-day winning streak. Sensex lost 75 points to settle at 27946 while Nifty finished at 8445, down 8 points. BSE mid-cap and small-cap indices however gained 0.5% and 0.6% respectively. BSE Oil & Gas and Auto indices gained 0.9% and 0.4% respectively, becoming top gainers among the sectroal indices while Metal and IT indices were the top losers, giving away 0.6% and 0.4% respectively.
FIIs net bought stocks, index futures and stock futures worth Rs 575 cr, 361 cr and 551 cr respectively. DIIs were net sellers to the tune of Rs 219 cr.
Rupee appreciated 9 paise to end at 63.51/$.
Today morning Shanghai is down nearly 4%, other Asian markets are trading mixed and SGX Nifty is suggesting about 10 points lower opening for our market.
In yesterday's report we had reiterated the fact that 8475 is were 34-week moving average is placed while 8490 is the immediate previous top on the weekly chart, which makes 8475-8490 an important resistance area.
The benchmark, after touching a high of 8479, slipped to end at 8445, giving more credence to this view.
Apart from this, there is looming uncertainty related to Greece referendum coming up on Sunday. In light of this, traders are advised to lighten trading positions.
Immediate support on the hourly chart is placed around 8355 below which 34-DMA, placed around 8265, would be the next support to eye.
US markets will remain shut today for Independence Day holiday.