10866-10750 CONTINUES TO BE IMPORTANT SUPPORT ZONE; 11250 IMMEDIATE HURDLE

10866-10750 CONTINUES TO BE IMPORTANT SUPPORT ZONE; 11250 IMMEDIATE HURDLE

WORLD MARKETS

Dow and S & P 500 fell 0.7% and 0.4% respectively while Nasdaq gained 0.1% amid political uncertainty and cancellation of U.S.-China trade talks.

News reports suggested that Deputy Attorney General Rod Rosenstein was about to resign or be fired. A White House statement later said Rosenstein and President Trump will meet on Thursday amid the conflicting reports.

New tariffs on U.S. and Chinese goods took effect while both countries also cancelled trade talks.

Brent soared $2.50 or 3.2% to $81.20, its best level since November 11, 2014 while WTI rose $1.30 or 1.8% to $72.08.

The benchmark 10-year Treasury note yield traded at 3.08%.

European markets fell 0.3%-0.9%.

AT HOME

It was a weak start to the week as benchmark indices plunged a percent and half, extending the losing streak to fifth straight day and closing at the lowest level since 11th July and 19th July for Sensex and Nifty respectively. Sensex lost 536 points to settle at 36305 while Nifty finished at 10975, down 168 points. BSE mid-cap and small-cap indices tumbled 2.4% and 2.7% respectively. BSE Realty and Auto indices collapsed 5.1% and 3.8% respectively, becoming top losers among the sectoral indices while IT and Teck indices were the top gainers, up 2.1% and 1.4% respectively.

FIIs net sold stocks and stock futures worth Rs 524 cr and 1310 cr respectively but net bought index futures worth Rs 522 cr. DIIs were net buyers to the tune of Rs 1528 cr.

Rupee depreciated 43 paise to end at 72.63/$.

OUTLOOK

Today morning, Hang Seng is shut, Nikkei is up 0.1% while Shanghai is down 0.4%. SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that "10866-10750 is a crucial support zone as 10866, the bottom made on Friday, also coincides with a trendline adjoining bottoms made in December 2016 and March 2018 while 34-week and 200-day moving averages are placed around 10800 and 10750 respectively".

Nifty yesterday plunged 168 points to close at 10967 and is set to open flat today.

10866-10750 continues to be important support zone to eye.

11250, the previous bottom on the daily chart, is the immediate resistance to eye.