US EQUITIES TUMBLE ON FRESH TRADE TENSIONS; 10700-10830 CONTINUES TO BE IMMEDIATE RANGE FOR NIFTY

US EQUITIES TUMBLE ON FRESH TRADE TENSIONS; 10700-10830 CONTINUES TO BE IMMEDIATE RANGE FOR NIFTY

WORLD MARKETS

US indices plunged 1.3%-2.1% on escalating trade dispute between the U.S. and China.

Media reports on Sunday suggested that Trump plans to bar several Chinese companies from making investments in U.S. tech and the administration also wants to block additional technology exports to China. Treasury Secretary Steven Mnuchin called the story "fake news" in a tweet but added that the measure will impact not just China, but all countries.

Harley-Davidson fell 6% after the company announced it will shift production of motorcycles headed for Europe to factories outside the U.S.

Bond prices rose with the benchmark 10-year yield falling to 2.882% while the two-year yield slipped to 2.545%.

WTI oil fell 50 cents to $68.08 and Brent fell 68 cents to $74.84 a barrel.

European markets nosedived 1.9%-2.5%. Autos were among the worst performing sectors after Trump, on Friday, threatened to apply new duties on European carmakers. German automaker BMW said Brexit could force U.K. plant closures. The German Ifo business climate index dropped to 101.8, the lowest level seen since May 2017.

AT HOME

After a flattish start, benchmark indices saw a sustained downward move through the session to end lower by six tenth of a percent. Sensex lost 219 points to settle at 35470 while Nifty finished at 10762, down 59 points. BSE mid-cap and small-cap indices fell 0.8% and 0.9% respectively. Except 0.8% and 0.6% higher IT and Teck indices respectively, all the BSE sectoral indices ended in red with Industrial and Oil & Gas indices leading the losses, down 1.8% and 1.6% respectively.

FIIs net bought stocks worth Rs 199 cr but net sold index futures and stock futures worth Rs 1482 cr and 324 cr respectively. DIIs were net sellers to the tune of Rs 86 cr.

Rupee depreciated 28 paise to end at 68.12$.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.3%-0.7% and SGX Nifty is suggesting about 30 points lower start for our market.

For past 7-8 sessions, Nifty is stuck in 10700-10830 range. After failing to cross the 10830 level decisively on Friday, Nifty yesterday slipped to end at 10762 and is set to open further lower today.

10700 continues to be important immediate support, upon breach of which 10550, the bottom made in early June, would be the next downside target. 10830 continues to be immediate hurdle, decisive crossover of which is required for a fresh upmove.