NIFTY TAKES A BREATHER; STAY LONG WITH THE STOP-LOSS OF 8810

NIFTY TAKES A BREATHER; STAY LONG WITH THE STOP-LOSS OF 8810

WORLD MARKETS                             

Dow ended marginally in the red, S & P 500 was flat while Nasdaq rose 0.2% yesterday.

The Beige Book, a key indicator of the U.S. economic health and closely watched by the Federal Reserve, showed moderate wage growth in coming months.

U.S. crude rose 1.5% or $0.67 to $45.50 per barrel after American Petroleum Institute data showed the largest weekly stock declines in nationwide crude inventories in over 30 years. Brent added $0.72 to close at $47.98.

Dollar index rose to 94.96 from 94.90. Gold fell $5 to $1349 an ounce.

European markets gained 0.3%-1.4% with Italy on the top. German industrial output for July fell 1.5% month-on-month, its steepest monthly drop since August 2014.

Japan revised its second-quarter gross domestic product (GDP) up to 0.7 percent year-on-year, compared with the initial estimates of 0.2 percent.

AT HOME

It was consolidation time as benchmark indices ended modestly lower after a range bound but choppy trading session. Sensex lost 52 points to settle at 28926 while Nifty finished at 8918, down 25 points. BSE mid-cap index fell 0.1% but the small-cap index gained 0.4%. BSE Capital Goods and Metal indices climbed 1.2% and 1.1% respectively, becoming top gainers among the sectoral indices while Consumer Durables and Utilities were the top losers, down 1% and 0.9% respectively.

FIIs net bought stocks worth Rs 854 cr but net sold index futures and stock futures worth Rs 27 cr and 1015 cr respectively. DIIs were net sellers to the tune of Rs 769 cr.

Rupee closed at 66.37/$, appreciating 15 paise compared to previous close.

BHEL surged 15.7% after reporting better-than-expected June quarter results supported by good business in its power segment. Net profit jumped 54% to Rs 77.7 crore in April-June from Rs 50.4 crore in corresponding quarter last fiscal. Total income rose 29% at Rs 5622 crore against Rs 4368 crore in year-ago period. EBITDA also improved to Rs 71 crore versus EBITDA loss of Rs 183 crore while EBITDA margin was at 1.3%. 

ONGC reported 21% y-o-y drop in June quarter net profit at Rs 4233 cr as oil prices slumped and its output fell. Realisation stood at $46.10 per barrel as against $59.08. In rupee terms realisation per barrel was down 18% at Rs 3085. Also, the company got 34.33% lower gas price at USD 3.06 per million British thermal unit. Oil output dropped 2% to 6.01 million tons while gas production was 5.55% lower at 5.494 billion cubic meters.

GAIL reported 244% y-o-y jump in June quarter net profit at Rs 1335 cr, boosted by a turnaround in petrochemical business and sale of stake in Mahanagar Gas. PAT excluding MGL gain stood at Rs 846 cr, up 118% y-o-y.

OUTLOOK

Today morning Asian markets are trading flat to modestly lower and SGX Nifty is suggesting a flattish start for our market.

Nifty, after touching a high of 8967 in the initial trade, eased to close at 8918 yesterday, taking a breather after Tuesday's steep upmove.

The overall trend however continues to be up and we would continue with the advise of holding on to trading longs with a trailing stop loss for the major target of 9119, the top made in March 2015.

Immediate support on the hourly chart has moved up to 8810, which should serve as that stop-loss.

ECB holds its policy meeting today.