WORLD EQUITIES END SEPTEMBER QUARTER ON A POSITIVE NOTE

WORLD EQUITIES END SEPTEMBER QUARTER ON A POSITIVE NOTE

WORLD MARKETS                             

US indices soared 1.5%-2.3% yesterday, following a rally in Asia and Europe.

The September ADP Employment report showed private companies added 200,000 jobs. Weekly mortgage applications fell 6.7 percent on a seasonally adjusted basis for the week ending September 25. The September Chicago purchasing managers index came in at 48.7, below expectations of 53.0.

Nymex oil fell 14 cents or 0.31% to $45.09 a barrel. Copper spiked amid quarter-end positioning and news of an output cut in Chile. Commodities trading and mining giant Glencore continued to recover with a gain of more than 11%. Gold fell $12 to $1115 an ounce.

European markets gained 2.2%-2.7%. Auto shares climbed after China said it has halved sales tax on small cars. Euro zone consumer prices fell 0.1% in September for the first time in six months, highlighting the continued risk of deflation.

Earlier Nikkei ended higher by 2.7%, Hang Seng gained 1.4% and Shanghai rose 0.5%.

AT HOME

After a gap up opening, benchmark indices traded in a range for better part of the day, but saw fresh surge in last hour to end with big gains of nearly a percent and half. Sensex settled at 26155, up 376 points while Nifty rose 106 points to finish at 7949. BSE mid-cap and small-cap indices gained 1.4% and 1.7% respectively. Except a 0.4% cut in Bankex, all the sectoral indices ended in green with Metal and FMCG indices leading the tally, putting on 3.4% and 2.4% respectively.

FIIs net bought stocks worth Rs 116 cr but net sold index futures and stock futures worth Rs 145 cr and 111 cr respectively. DIIs were net sellers to the tune of Rs 192 cr.

Rupee appreciated 38 paise to end at 65.5825/$.

April-August fiscal deficit stood at 3.69 lk cr vs Rs 3.98 cr yoy.

The Union government yesterday announced revival of the long-stricken Dabhol power plant. The central and state governments will provide financial support to the project, GAIL  will provide gas under the government's recently-launched gas supply scheme for stranded power plants while NTPC  will operate it. The Indian Railways will enter into a long-term power purchase agreement with the company at a price of Rs 4.7 per unit.

Natural gas prices were yesterday cut by a steep 18% to USD 3.82 per unit, the biggest reduction in rates ever, that will dent government revenues by about Rs 800 crore and hit profits of producers like ONGC

India's core sector, comprising of eight key industries, grew by 2.6% in August, up from 1.1% in July.

OMCs hiked diesel price by 50 paise per litre yesterday.

OUTLOOK

China's final Caixin/Markit manufacturing PMI for September has fallen to a fresh six-and-a-half year low of 47.2, versus an earlier flash estimate of 47. Government's official PMI rose to 49.8 in September, up from Augusts’ three-year low of 49.7.

Markets in China and Hong Kong are shut today, other Asian markets are trading with gains of upto a percent and SGX Nifty is suggesting about 40 points higher opening for our market.

In yesterday's report we had mentioned that 7926 and 7691, the top and bottom made on RBI policy day, would be the immediate resistance and support level to eye and that a crossover of 7926 would take the benchmark in the vicinity of major 8100 hurdle.

Nifty yesterday comfortably crossed 7926 mark and closed at 7949. 8055-8100, where two immediate previous tops on the daily chart are placed, is the next resistance area, a crossover of which will also confirm a higher-top higher-bottom formation on the daily chart.

Immediate support on the hourly chart is placed at 7850.

India's September manufacturing PMI will be released today. Auto companies will report their September sales figures.

IDFC will start trading ex-banking business from today.