NIFTY FAILS TO CLEAR 34-DMA HURDLE ONCE AGAIN; GST COUNCIL MEETING IN FOCUS

NIFTY FAILS TO CLEAR 34-DMA HURDLE ONCE AGAIN; GST COUNCIL MEETING IN FOCUS

WORLD MARKETS                             

US indices climbed 0.5%-0.8% with the S & P 500 extending the winning streak to eight straight day, its longest since 2013.

Financials rose tracking higher yields after House passed a $4.1 trillion budget, the first concrete step toward tax reform.

Weekly jobless claims fell by 12,000 to 260,000. The trade deficit shrank by 2.7% to $42.4 billion in August. Factory orders rose 1.2% in August, more than the expected 1% increase.

Dollar index rose about half a percent to seven-week high of 93.92.

WTI crude rebounded to settle 1.6% higher at $50.79 on expectations that Russia, Saudi Arabia will extend production cut.

European markets, except a marginally lower DAX, gained 0.3%-0.5%. Spain soared 2.5% on news that Spain's Constitutional Court has suspended a session of the Catalan Parliament due to take place Monday, during which, political leaders were expected to declare Catalonia's independence from Spain.

AT HOME

After rising about three tenth of a percent in first hour, benchmark indices slipped to end lower by a fourth of a percent, breaking four-day winning streak. Sensex lost 80 points to settle at 31592 while Nifty finished at 9889, down 26 points. BSE mid-cap and small-cap indices however gained 0.5% and 0.8% respectively. BSE Basic Material and Realty indices climbed 0.9%, becoming top gainer among the sectoral indices while Telecom and Oil & Gas indices were the top losers, down 0.7% and 0.6% respectively.

FIIs net sold stocks and index futures worth Rs 657 cr and 490 cr respectively but net bought stock futures worth Rs 129 cr. DIIs were net buyers to the tune of Rs 519 cr.

Rupee depreciated 13 paise to end at 65.14/$.

India's Nikkei/IHS Markit Services Purchasing Managers' Index rose to 50.7 in September from 47.5 in August, moving back above the 50-mark that separates growth from contraction. Composite PMI, which maps both manufacturing and services sectors, rose to 51.1 in September, from 49 in August

OUTLOOK

Today morning, Asian markets are trading with gains of upto 0.6% and SGX Nifty is suggesting about 30 points higher start for our market.

For past couple of sessions, we have been mentioning that 34-DMA, placed around 9930, is the important immediate hurdle, a decisive crossover of which is required for a fresh upmove. Yesterday, Nifty, after touching a high of 9945, slipped to end at 9888, failing to clear this hurdle once again.

If this hurdle is taken out decisively, 10015, the two third retracement level of the recent fall, would be the next target to eye.

9820 continues to be immediate support on the hourly chart below which 9685 would be the crucial support to eye.

All eyes would be on the GST Council meeting today which is expected to ease tax compliance requirement and relief package for MSMEs and exporters.

US September non-farm payroll data will be released today where addition of just 90000 jobs is expected as against 156000 in the previous month due to effects of hurricane Irma and Harvey.