10941 CONTINUES TO BE NEXT UPSIDE TARGET; TRAIL STOP-LOSS TO 10660

10941 CONTINUES TO BE NEXT UPSIDE TARGET; TRAIL STOP-LOSS TO 10660

WORLD MARKETS

US indices nosedived 1.9%-2.3% after weaker-than-expected data in China and Europe exacerbated concerns of a global economic slowdown. Dow ended at its lowest since early May while S & P 500 fell to the lowest level since April.

China reported industrial output and retail sales growth numbers for November that missed expectations. Industrial output in November grew 5.4% from a year ago — the slowest pace in almost three years. Retail sales rose 8.1% in November — the weakest pace since 2003.

The IHS Markit Flash Eurozone PMI index fell to 51.7 in December, its lowest level in four years.

US oil fell 2.6% to $51.20 and Brent tumbled 2.2% to $60.12 a barrel, weighed down by a falling U.S. stock market and weak economic data from China.

European markets fell 0.4%-0.9%.

For the week, US indices fell 0.8%-1.3%, extending the losing streak to second consecutive week.  Main European markets gained 0.7%-1%.  In Asia, Nikkei and Shanghai fell 1.4% and 0.5% respectively but Hang Seng ended 0.1% higher.

The Bank of International Settlements (BIS), an umbrella group for the world’s central banks, said on Sunday that recent market tensions are a sign of more turmoil to come. It warned that a normalization of monetary policy is likely to trigger a flurry of sharp sell-offs in the near future.

AT HOME

It was a day of consolidation as benchmark indices ended marginally higher after trading in a narrow range through the session. Sensex settled at 35962, up 33 points while Nifty added 14 points to finish at 10805. BSE mid-cap and small-cap indices gained 0.2% and 0.03% respectively. BSE Telecom and Oil & Gas indices soared 3.1% and 1.7% respectively, becoming top gainers among the sectoral indices while Healthcare and Capital Goods indices were the top losers, down 0.8% and 0.7% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 862 cr, 249 cr and 357 cr respectively. DIIs were net sellers to the tune of Rs 303 cr.

Rupee depreciated 3 paise to end at 71.89/$.

For the week, Sensex and Nifty gained 0.8% and 1% respectively.

India's November WPI inflation came in at 4.8% against 5.1% month-on-month.

November trade deficit narrowed to $16.67 billion, down from $17.13 billion in October. Export grew 0.8% y-o-y while imports grew at 4.3%.

OUTLOOK

Today morning, Nikkei is up 0.6% while Hang Seng and Shanghai are little changed. SGX Nifty is suggesting about 35 points higher start for our market.

Last week, after Nifty crossed the immediate hurdle of 10600, we had given upside targets of 10740 followed by 10833 and 10941.

Nifty, after touching a high of 10838, ended the week at 10805 and is set to open around 10840 today.

Above 10838, the top made Friday, 10941, the top made in early December, would be next upside target as well as hurdle to eye.

Immediate support, after today's higher start, would have moved up to 10660, with the stop-loss of which, trading longs can be held on to.