AFTER TESTING 8880 SUPPORT, NIFTY SET TO CHALLENGE 8970 HURDLE
US indices soared nearly a percent and half, posting their best day of the year, on the back of President Donald Trump's speech to Congress. Dow closed above 21,000 for the first time.
Trump's speech was widely praised for its positive tone in which he re-iterated a commitment to a massive infrastructure spend and tax reform.
Personal income rose 0.4% in January, topping expectations, while consumer spending slowed. However, the personal consumption expenditures (PCE) jumped 1.9% in the 12 months through January, putting inflation very close to the Federal Reserve's target of 2%. Construction spending fell 1% in January, well below expectations, but the February ISM manufacturing index rose to 57.7, up from January's 56.0 reading.
U.S. Treasury yields rose broadly, with the two-year note yield hitting its highest level since 2009 and the benchmark 10-year note yield jumping to 2.46%.
US crude fell 0.3% to $53.83 a barrel and Brent was down 0.3% at $56.36.
European markets climbed 1.6%-2.4%
Benchmark indices gained 0.8% today, breaking the two-day losing streak and closing at the highest level since 8th September, 2016. Sensex added 241 points to settle at 28984 while Nifty finished at 8946, up 66 points. BSE mid-cap and small-cap indices gained 0.1% and 0.4% respectively. BSE Realty index soared 3.5%, becoming top gainer among the sectoral indices, followed by 1.9% rise in Metal index. Oil & Gas and Utilities indices were the top losers, down 0.9% and 0.5% respectively.
FIIs net sold stocks and stock futures worth Rs 198 cr and 1224 cr respectively but net bought index futures worth Rs 169 cr. DIIs were net buyers to the tune of Rs 254 cr.
Rupee depreciated 13 paise to end at 66.83/$.
Maruti reported a 10.9% y-o-y increase in February sales at 1.30 lac units. Eicher Motors' Royal Enfield February sales grew 19% to 58439 units. Ashok Leyland reported an increase of 5% at 14067 units. Escorts sales surged 29.5% to 4247 units. M & M total sales were down 2.9% at 42714 units however tractor sales rose 11% to 15007 units. Tata Motor's total sales grew by 2% at 47573 units. Hero Motocorp registered 5% dip at 5.24 lac units and TVS Motors sales fell 4% to 2.11 lac units.
Today morning, Shanghai is up 0.1% but other Asian markets are trading with gains of 0.8%-1.1% and SGX Nifty is suggesting about 50 points higher start for our market.
In yesterday's report we had mentioned that a breach of 8867, the bottom made on Tuesday, would confirm a sell on the hourly chart and pave the way for the further correction. We had also reiterated the view that a decisive crossover of 8970 is required for the fresh upmove and 9119, the top made in March 2015 would be the next target if that happens.
The benchmark opened higher and added some more gains through the session to end at 8946 and is set to open above the 8970 mark today.
As mentioned above, upon a decisive crossover of 8970, 9119 would be the next target to eye.
8867 continues to be immediate support, with the stop-loss of which trading longs can be held on to.