OIL SOARS ON OPEC, NON-OPEC DEAL; NIFTY FACING 8300-8340 HURDLE

OIL SOARS ON OPEC, NON-OPEC DEAL; NIFTY FACING 8300-8340 HURDLE

WORLD MARKETS                             

US indices gained 0.5%-0.7% on Friday, closing at fresh record high and notching best weekly gains since the election. Dow, S&P 500 and Nasdaq, all three rose each day of last trading week, something that has not been seen since September 2011.

University of Michigan's consumer sentiment index for December rose to 98 from 93.8 in November to hit its highest level since January 2015 and wholesale inventories for October showed a decline of 0.4%.

US treasuries fell with the two-year note yield rising to 1.1369% while the benchmark 10-year yield advancing to 2.4665%. Dollar index rose 0.5% to 101.57, building on Thursday's sharp gains following the ECB's announcement. Gold fell %10 to $1162 per ounce.

US oil rose 1.3%to $51.50 per barrel.

European markets, except a 0.7% lower Italy, gained 0.3%-0.6%. Germany reported a 4.1 percent contraction in exports in October. Imports dropped 2.2 percent. As a result, Germany's trade surplus moved from 24.4 billion euros ($25.94 billion) to 19.3 billion euros.

For the week, Dow and S & P 500 climbed 3.1% each while Nadaq added 3.6%. European markets soared 3.3%-6.6%. In Asia Nikkei rose 3.1%, Hang Seng was up 0.9% but Shanghai lost 0.3%.

AT HOME

Benchmark indices ended higher by a fifth of a percent after a rangebound session, consolidating yesterday's mammoth upmove. Sensex settled at 26747, up 53 points while Nifty added 15 points to finish at 8262. BSE mid-cap and small-cap indices gained 0.2% and 0.5% respectively. BSE Realty index and Bankex climbed 1.6% and 1.1% respectively, becoming top gainers among the sectoral indices while Telecom and Auto indcies were the top losers, giving away 0.6% and 0.5% respectively.

FIIs net bought stocks and index futures worth Rs 201 cr and 241 cr respectively but net sold stock futures worth Rs 192 cr. DIIs were net buyers to the tune of Rs 290 cr.

Rupee depreciated 7 paise to end at 67.42/$.

For the week, Sensex and Nifty added 2% and 2.2% respectively, registering the largest weekly gain since the week ended 2nd September.

India’s factory output fell 1.9% in October compared to a growth of 0.7% in the previous month — signs that festive season shopping have failed to trigger an industrial revival.

The 6th meeting of the GST Council again failed yesterday to sort out contentious issue of dual control of assesses. The Council will meet again on December 22-23. This means the three GST Bills will not be brought to Parliament for passage in the winter session.

U.S. President-elect Donald Trump on Thursday promised to end the misuse of visa programmes by companies to undercut American workers, referring to an incident that involved Indian companies and IT professionals on H-1B visas.

OUTLOOK

Over the weekend, Organization of Petroleum Exporting Countries (OPEC) and non-OPEC countries led by Russia arrived at their first output cutting agreement in Vienna, a first since 2001. WTI and Brent crude have soared more than 4% on account of this and are trading around $53.76 and $56.63 respectively.

Nikkei is up more than a percent, other Asian markets are trading with modest gains and SGX Nifty is suggesting about 10 points higher start for our market.

Readers would recall that after Nifty crossed the immediate hurdle to 8185, we have been working with targets of 8250 and 8340 where 8250 was the immediate previous top on the daily chart made on 1st December and 8340 is where the 61.8% retracement level of 8600-7916 fall is placed.

The benchmark, after achieving the 8250 target on Thursday, touched a high of 8275 before closing at 8262, moving towards the 8340 target. Now the downward moving 34-DMA as well as the upper level of the bollinger band, both are placed around 8300 which makes 8300-8340 a tough resistance area.

Immediate support on the hourly chart has moved up to 8160, with the stop-loss of which, trading longs can be held on to.