NIFTY ON TRACK TO ACHIEVE 7778 TARGET
US indices climbed 0.8%-1% yesterday with energy stocks leading as oil topped $42 barrel.
WTI crude climbed $1.81 or 4.5% to $42.17 a barrel to hit a fresh high for the year so far and settle at its highest since late November on reports that Saudi Arabia and Russia have reached a consensus on oil freeze. Brent rose 4.3% to $44.69.
Alcoa reported better-than-expected adjusted first-quarter earnings but revenues missed estimates. The aluminum producer also announced job cuts. The stock closed down 2.7%.
US March import prices rose 0.2% from the prior month for the first time in nine months, although the gain was well below the expected 1% rise. Export prices were unchanged. U.S. small business confidence fell to a fresh two-year low in March at 92.6, amid persistent worries about sales and profits.
Yen stood at 108.5 against the greenback, marking the first retreat in April. US dollar index rose marginally.
IMF downgraded its forecast for world economic growth for 2016 by 0.2% to 3.2%. The agency however maintained forecast for India at 7.5%.
European markets, except a 1.6% cut in Italy, gained 0.5%-0.8%.
Benchmark indices gained half a percent yesterday, extending the winning streak to third straight day. Sensex settled at 25145, up 123 points while Nifty added 38 points to finish at 7709. BSE mid-cap and small-cap indices gained 1% and 0.9% respectively. Except a 1.4% cut in Metal index, all the BSE sectoral indices ended higher with Auto and Industrial indices leading the tally, up 1.6% and 1.4% respectively.
FIIs net bought stocks and index futures worth Rs 308 cr and 117 cr respectively but net sold stock futures worth Rs 242 cr. DIIs were net sellers to the tune of Rs 62 cr.
Rupee ended unchanged at 66.43/$.
Indian Meteorological Department (IMD) yesterday said that monsoon is likely to be above average at 106 percent of long period average (LPA). This was in-line with Private weather forecaster Skymet, which on Monday said that 2016 monsoon will be above normal and will average at 105% level of LPA with slim chances of a drought.
India's retail inflation, as measure by the CPI, fell to 4.83% in March as against estimate of 5.05% and February’s 5.18% level.
After three consecutive months of decline, industrial output, measured by IIP, rose 2% in February, compared to estimates of 1.5% growth and contraction of 1.5% registered in January.
Today morning Asian markets are trading with gains of 0.5%-2% with Nikkei leading on the way up and SGX Nifty is suggesting about 40 points higher opening for our market.
In yesterday's report we had mentioned that having crossed 7650 hurdle, next target on the way up is 7778, the top made in March and that one should stay long with the stop loss of 7590.
The benchmark yesterday gained 38 points to settle at 7709 and is set to open about 50 points higher today.
7778 continues to be the hurdle as well as the upside target to eye. A decisive crossover of 7778 would open up the further upside till about 7875 where 200-DMA is placed.
Traders would do well to book some profit in long positions around 7778 and trail stop loss in remaining ones to 7610, which is the immediate support on the hourly chart.
Today is also the last trading day of this week as markets will be shut tomorrow and day after for Dr Ambedkar Jayanti and Ram Navmi respectively.
Infosys will report its quarterly earnings on Friday.