LARGEST WEEKLY GAIN FOR NIFTY IN MORE THAN A YEAR; 7240-7125 ARE THE IMMEDIATE LEVELS

LARGEST WEEKLY GAIN FOR NIFTY IN MORE THAN A YEAR; 7240-7125 ARE THE IMMEDIATE LEVELS

WORLD MARKETS                             

Dow lost 0.1%, S & P 500 ended flat while Nasdaq gained 0.4% on Friday.

The consumer price index rose 0.3% ex-food and energy in January. The headline figure was unchanged from the previous month. Year-over-year, the core CPI advanced 2.2%, the largest rise since June 2012.

Nymex oil fell $1.13 or 3.7% to $29.64 and Brent settled down $1.32 or 3.85% at $32.96 a barrel

European markets fell 0.4%-1.2% with oil & gas stocks leading the losses. After the U.S. market close, British Prime Minister Cameron said he "negotiated a deal to give the U.K. special status in the EU" and he believed it is enough to recommend Britain stay in the union.

For the week however, US indices climbed 2.6%-3.8% with the Dow and S&P 500 posting their best week since the one ending Nov. 20. European markets soared 3.5%-5.7%, with DAX gaining the most since October 2014. Asian markets surged 3.1%-6.8% with Nikkei leading the tally and Shanghai Composite rising the most since mid-December.

AT HOME

Benchmark indices managed to end higher by a fourth of a percent after a choppy session on Friday, extending the winning streak to third straight day. Sensex settled at 23709, up 60 points while Nifty added 19 points to finish at 7211. BSE mid-cap index however lost 0.1% while the small-cap index gained 0.2%. BSE Telecom and Auto indices gained 1.4% and 0.9% respectively, becoming top gainers among the sectoral indices while Oil & Gas and Energy indices were the top losers, down 1% and 0.6% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 192 cr, 846 cr and 33 cr respectively. DIIs were net buyers to the tune of Rs 17 cr.

Money markets were shut on Friday for Shivaji Jayanti.

For the week, Sensex and Nifty gained 3.1% and 3.3% respectively, breaking two-week losing streak. This was the largest weekly gain for Nifty since the week ended 23^rd January 2015.

OUTLOOK

Today morning Asian markets are trading with gains in the vicinity of a percent and SGX Nifty is suggesting a flattish start for our market.

In Friday's report we had mentioned that while the set-up on the hourly chart looks more conducive for an upward breakout, one can wait for the crossover of 7240 hurdle for taking fresh longs. 

That continues to be the view. Upon crossover of 7240, 7400, where the 34-DMA is placed, would be the next target to eye. Immediate support on the hourly chart has moved higher to 7125, with the stop loss of which existing longs can be held on to.