NIFTY REBOUNDS FROM THE VICINITY OF 10565 SUPPORT
US indices soared 0.9%-1.3% after recent fears about Italy faded. Financials rose on the back of this news and rise in interest rate while rebound in oil boosted energy stocks.
Media reports suggested that Italy's interim prime minister, who had been appointed by President Sergio Mattarella, said possibilities had surfaced "for the birth of political government".
The euro recovered much of its previous losses with a 1.1% climb against the dollar to $1.166. Italian bond yields, which spiked Tuesday, fell across the board Wednesday with the two-year bond yields down to 1.72% from 2.1%. The yield on the US benchmark 10-year Treasury note rose 7 bps to 2.84%.
Oil climbed on report that Saudi Arabia and other OPEC states aim to stick to a global pact on cutting oil supplies until the end of 2018. WTI rose $1.48, or 2.22% to $68.21/bbl. Brent rose $2.11, or 2.8%, to $77.50.
European markets, except a 0.2% lower CAC, gained 0.8%-2.1% with Italy on the top.
In Germany, the consumer price inflation surged to 2.2% in May, above the European Central Bank's target of below, or close to, 2%. A euro area sentiment survey for May showed a fall to 112.5 from 112.7 in the previous month.
After falling about seven tenth of a percent in the morning, benchmark indices recouped most of the losses in noon trade to end just modestly lower. Sensex settled at 34906, down 43 points while Nifty lost 19 points to finish at 34906. BSE mid-cap index ended flat while small-cap index lost 0.2%. BSE Healthcare and Capital Goods indices fell 0.8% and 0.7% respectively, becoming top losers among the sectoral indices while Utilities and Power indices gained the most, up 0.2% each.
FIIs net sold stocks and index futures worth Rs 1287 cr and 832 cr respectively but net bought stock futures worth Rs 270 cr. DIIs were net buyers to the tune of Rs 492 cr.
Rupee appreciated 43 paise to end at 67.43/$.
MSCI Inc. yesterday said it is considering placing some emerging markets including India on notice for limiting investor access.
ONGC numbers were a miss. Net profit rose 18% q-o-q to Rs 5915 cr while EBIDTA fell 9% to Rs 11382 cr and operating margins were down 670 bps to 47.5%. Realisation per barrel of crude stood at $66.71, up from $60.58.
Today morning, Asian markets are trading with gains in the vicinity of half a percent and SGX Nifty is suggesting about 35 points higher start for our market.
In yesterday's report we had said that "the immediate support on the hourly chart is placed at 10565, a breach of which will generate a "Sell" on the hourly chart and pave the way for further correction".
Yesterday, Nifty, after touching a low of 10558, rebounded to end at 10614 and is set to open around 10650 today. 10717, the top made Tuesday, is the immediate hurdle to eye. 10558, the bottom made yesterday, is the immediate support, a breach of which will confirm a "Sell" on the hourly chart and would pave the way for further correction.
India's March quarter GDP data will be released today and is expected to show a growth of 7.4%, up from 7.2% in the previous quarter.