STAY LONG WITH THE STOP LOSS OF 7800

STAY LONG WITH THE STOP LOSS OF 7800

WORLD MARKETS                             

US indices gained 0.4%-0.6% on Friday, helped by gains in retail stocks, as investors looked to central banker comments on the trajectory of monetary policy.

Nike jumped more than 5% after the company increased its dividend by 14%, declared a 2-for-1 stock split, and announced a $12 billion stock buyback program.

Nymex oil fell 15 cents or 0.4% to $40.39 a barrel.

European Central Bank President Mario Draghi said the ECB stands ready to "do what (it) must to raise inflation as quickly as possible" if it decides current policy isn't stimulating the sluggish euro zone economy.

European markets ended mixed with modest changes.

For the week, US indices gained 3.3%-3.6% with the S & P 500 registering best week since the one ended October 24, 2014. European markets rose 1.4%-3.8%.

AT HOME

After rising nearly eight tenth of a percent, benchmark indices gave away most of the gains in last hour to end just marginally higher. Sensex settled at 25868, up 27 points while Nifty added 14 points to finish at 7857. BSE mid-cap and small-cap indices gained 0.9% and 0.6% respectively. BSE Oil & Gas index climbed 2%, becoming top gainer among the sectoral indices, followed by 0.8% rise in Capital Goods index. FMCG and Realty indices were the top losers, down 0.8% and 0.3% respectively.

FIIs net sold stocks worth Rs 94 cr but net bought index futures and stock futures worth Rs 261 cr and 136 cr respectively. DIIs were net buyers to the tune of Rs 610 cr.

Rupee depreciated 1 paise to end at 66.18/$.

For the week, Sensex and Nifty gained 1% and 1.2% respectively, breaking three-week losing streak.

An inter-ministerial committee cleared as many as 32 proposals for setting up manufacturing units in defence and explosive sectors which includes conditional approval to eight subsidiaries of Reliance Infra.

Shares of gas stocks such as GAIL, Petronet LNG, GSPL, IGL and Gujarat Gas rallied sharply following news reports that Ras Gas company has agreed to modify long term contract with Petronet, which will now be linked at 3 months of Brent from earlier 12 months, enabling cost of gas to drop below USD 7/mmbtu from USD 12.5/mmbtu. Reports further suggested that Qatar has agreed not to levy any take or pay liability for 2015 lower off-take, which was estimated at USD 1.5 billion..

In a major blow to India Inc, the Central Board of Direct Taxes (CBDT) on Friday released a roadmap for phasing out corporate tax exemptions. It will phase out profit and investment-linked and area based tax deductions for companies. The CBDT has also said it will not make any modifications to sunset date in income tax and there will be no weighted tax deduction from FY18.

OUTLOOK

US Fed said that it will hold an unscheduled meeting on Monday to review the advance and discount interest rates charged to commercial banks and other financial institutions.

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 20 points higher opening for our market.

In Friday's trade, Nifty crossed immediate hurdle of 7860 and surged all the way to 7907, but witnessed a severe profit booking in late noon trade to end at 7857.

Nevertheless, the index has generated a buy on the hourly chart and traders can continue to hold long positions with the immediate support of 7800.

On the upside, 7907, the top made on Friday, is the immediate hurdle, upon crossover of which, 34-DMA, placed at 8055, would be the next target.