STAY LONG WITH THE STOP-LOSS OF 9330

STAY LONG WITH THE STOP-LOSS OF 9330

WORLD MARKETS                             

US indices fell 0.1%-0.2% with retail stocks taking a plunge on the back of Macy's weak quarterly results.

Producer price index rose 0.5% in April, more than the expected increase of 0.2%. Initial jobless claims totaled 236,000, below the expected 245,000.

Dollar index, after touching a high of 99.88, gave away all the gains to end at 99.65.

WTI and Brent oil gained a percent to settle at $47.83 and $50.72 a barrel respectively.

European markets, except a flat FTSE, fell 0.3%-0.4%. Basic resources however bucked the trend, buoyed by rising oil prices and major gains for mining giants Fresnillo and Polymetal. The Bank of England left interest rates unchanged at 0.25% but lowered its growth projections for the United Kingdom. Sterling fell shortly after the decision as some investors had expected more than one vote for a rate rise. Meanwhile, UK industrial production shrank 0.5% in March.

AT HOME

After opening higher by half a percent, benchmark indices gave away most of the gains through the session to end just marginally higher. Sensex settled at 30250, up 3 points while Nifty added 15 points to finish at 9422. BSE mid-cap index ended 0.05% higher while small-cap index lost 0.05%. BSE Consumer Durable and Consumer Discretionary Goods & Services indices gained 1.6% and 1.2% respectively, becoming top gainers among the sectoral indices while Power and Utilities indices were the top losers, down 1.2% and 1% respectively.

FIIs net bought stocks and stock futures worth Rs 1307 cr and 434 cr respectively but net sold index futures worth Rs 155 cr. DIIs were net sellers to the tune of Rs 1037 cr.

Rupee appreciated 25 paise to end at 64.37/$.

HCL Technologies reported better than expected results in terms of revenue, EBIT as well as dollar revenue for the quarter ended March 31. Dollar revenue rose 4.1% q-o-q to $1817 mn while constant currency growth stood at 3.8%. Rupee revenue grew 2% to Rs 12053 cr and net profit was up 20.8% at Rs 2325 cr. For FY18, the company guided for a revenue growth of 10.5-12.5% in constant currency terms while EBIT margin guidance stood at 19.5-20.5%.

Asian Paints reported 7.8% y-o-y growth in topline at Rs 3852 cr. EBIDTA rose 2.2% to Rs 712 cr and margin contracted by 100 bps to 18%. Net Profit rose 10.3% to Rs 480 cr. Volume growth at 10% was better-than-expected.

OUTLOOK

Today morning, Asian markets, except a marginally higher Hang Seng, are trading with modest cuts and SGX Nifty is suggesting a flattish start for our market.

We had given a target of 9470 after Nifty broke out of 9370-9270 consolidation. The benchmark yesterday touched a high of 8451, moving very close to the 9470 target, but slipped from there to end at 9422.

9470-9500 continues to be the next target area to eye. Immediate support on the hourly chart has moved up to 9330, with the stop-loss of which trading longs should be held on to.

Dr Reddy, Titan and Nestle will report their quarterly earnings today.

The government today will release the new Index of Industrial Production (IIP) and Wholesale Price Index (WPI) series with 2011-12 base year replacing the 2004-05 base years. IIP for March is expected to show a growth of 1.5%, up from a decline of 1.2% in February. April CPI is expected at 3.49%, down from 3.81% in March. April WPI is expected to ease to 4.79% from 5.70%.