NIFTY SET TO TEST 10710-10760 RESISTANCE ZONE; RBI BOARD MEET IN FOCUS

NIFTY SET TO TEST 10710-10760 RESISTANCE ZONE; RBI BOARD MEET IN FOCUS

WORLD MARKETS

Dow and S & P 500 rose 0.5% and 0.2% respectively while Nasdaq fell 0.2% on Friday.

Stocks hit their session highs after President Trump said he was hopeful the U.S. and China will strike a deal on trade. However, White House officials later told CNBC that a deal was not coming soon and that people should not read too much into Trump's comments.

Tech was under pressure again as shares of Nvidia plunged 18.8% on disappointing revenue and guidance.

Oil prices, after rising earlier in the session on expectations that OPEC and its allies would agree to cut output next month, pulled back to end just marginally higher. Brent added 14 cents to end at $66.76 a barrel while US crude ended flat at $56.46.

Brexit continued to be in focus amidst heightened fears the U.K. could soon crash out of the European Union without a divorce deal.

European markets fell 0.1%-0.3%.

For the week, US indices fell 1.6%-2.2%, snapping two-week winning streak. European markets were off 1.3%-1.6%. Asia was mixed with Nikkei off 2.6% while Shanghai and Hang Seng were up 3.1% and 2.3% respectively. WTI oil fell 6.2%, posting sixth straight weekly loss.

AT HOME

Benchmark indices gained six tenth of a percent, extending the winning streak to second straight day and closing at the highest level since 3rd October. Sensex added 196 points to settle at 35457 while Nifty finished at 10682, up 65 points. BSE mid-cap index ended flat while small-cap index lost 0.4%. BSE Telecom index soared 6.3%, becoming top gainer among the sectoral indices, followed by 1.5% higher Energy index. Metal index was the top loser, down 1.6%, followed by 0.5% lower Oil & Gas index.

FIIs net bought stocks and index futures worth Rs 845 cr and 163 cr respectively but net sold stock futures worth Rs 444 cr. DIIs were net sellers to the tune of Rs 372 cr.

Rupee appreciated 6 paise to end at 71.92/$.

For the week, Sensex and Nifty gained 0.8% and 0.9% respectively, extending the winning streak to third straight week.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.3%-0.6% and SGX Nifty is suggesting about 50 points higher start for our market.

In Friday's report we had mentioned that upon sustained trading above 10645, which was the top made on last Monday, 10710 and 10760 would be next upside targets to eye where 10710 is the top made in mid-October while 10760 is where the 200-DMA is placed.

Nifty, on Friday, rose to end at 10682 and is set to open right in the middle of the 10710-10760 resistance zone mentioned above.

10760 continues to be immediate hurdle to eye upon sustained trading above which 34-week moving average, placed around 10850, would be the next important hurdle to eye.

Immediate support on the hourly chart has moved up to 10575, with the stop-loss of which, trading longs should be held on to.

The central board of the Reserve Bank of India will meet today amid a public battle over a host of issues ranging from banking regulation to the central bank’s own balance sheet. Four key issues, which are bone of contention and are expected to come up for discussion are 1) Minimum capital banks need to maintain 2) Providing more liquidity 3) Ease the filters that push a bank to Prompt Corrective Action (PCA) and 4) Special dispensation for Small and Medium Enterprises (SMEs).