NIFTY ACHIEVES 8740 TARGET; TRAIL STOP-LOSS TO 8640

NIFTY ACHIEVES 8740 TARGET; TRAIL STOP-LOSS TO 8640

WORLD MARKETS                             

Dow and Nasdaq ended marginally in the red while S & P 500 gained 0.06%, looked ahead to Friday's jobs report, amid tension between U.S. President Donald Trump and other country leaders.

According to an excerpt of a transcript of the conversation obtained by The Associated Press, Trump warned Mexican President that he was ready to send U.S. troops to stop "bad hombres down there" unless the Mexican military does more to control them.

Trump's conversation with Australian Prime Minister Turnball last Saturday was equally worrisome. Trump heavily criticized an Australian-U.S. refugee deal and told Turnbull that among all the conversations he had with political leaders that day, this one was "the worst call by far."

Tensions are also brewing between the Trump administration and Iran, after National Security Adviser Michael Flynn put Iran "on notice" after it conducted a ballistic missile test this week.

In economic news, initial jobless claims fell 14,000 to 246,000.  Fourth-quarter non-farm productivity rose 1.3%

Dollar index rose 0.15% to 99.82. U.S. Treasury yields were mixed, with the benchmark 10-year note yield near 2.47% and the short-term two-year note yield around 1.21%.

European markets endex mixed with DAX down 0.3%, flat CAC and half a percent higher FTSE. Bank of England unanimously decided to keep benchmark rates unchanged and increased its annual growth forecast to 2% from its November estimate of 1.4%. Sterling, which had hit a seven-week high ahead of the BoE announcement, dropped over 0.9% against the dollar following the news.

AT HOME

Sensex and Nifty gained 0.3% and 0.2% respectively, extending yesterday's mammoth upmove and closing at fresh four-month high. Sensex settled at 28227, up 85 points while Nifty added 18 points to finish at 8734. BSE mid-cap and small-cap indices climbed 0.9% each. BSE Consumer Durable index soared 2.2%, becoming top gainer among sectoral indices, followed by 1.8% each rise in Healthcare and IT indices.

FIIs net bought stocks worth Rs 109 cr but net sold index futures and stock futures worth Rs 320 cr and 858 cr respectively. DIIs were net sellers to the tune of Rs 111 cr.

Rupee appreciated 10 paise to end at 67.37/$.

TVS Motor reported 0.7% y-o-y fall in January sales at 2.07 lk units. Bajaj Auto sales were down 18% at 2.42 lk units.

OUTLOOK

China's January Caixin manufacturing PMI has come in at 51, down from 51.9 in December.

Asian markets are trading flat to modestly higher and SGX Nifty is suggesting a marginally higher start for our market.

Nifty yesterday touched a high of 8774, achieving the 8740 target and coming in close to 8800 target we had been working with ever since 8560, the 61.8% retracement level of the entire 8970-7893 fall, was crossed.

8800, as mentioned above, is the next target, above which 8900-8970 would be the next major target area.

Immediate support on the hourly chart has moved up to 8640, with the stop-loss of which existing longs can be held on to.

In the US, January employment data will be released today and is expected to show an addition of 175000 jobs with unemployment rate unchanged at 4.7%.