NIFTY NEARS 10941 TARGET; TRAIL STOP-LOSS TO 10735

NIFTY NEARS 10941 TARGET; TRAIL STOP-LOSS TO 10735

WORLD MARKETS

US indices nosedived 2.1%-2.3% ahead of the Federal Reserve Bank's anticipated rate hike on Wednesday amidst continued concerns over global growth.

The Fed is widely expected to hike its benchmark overnight lending rate for a fourth and final time of 2018 on Wednesday. Concerns of rising interest rates have heightened over the past month as inflation and growth expectations recede.

U.S. President Trump took aim at the Fed again yesterday, saying in a tweet that "it is incredible" that the central bank was "even considering yet another interest rate hike" amid the "outside world blowing up around us."

Homebuilder sentiment fell to its lowest level since May 2015 in December as potential buyers delay purchasing new homes despite a pullback in mortgage rates in the past month. New York manufacturers reported that business activity is still expanding, but growth slower much more than expected in December.

US crude fell 2.6% to 14-month low of $49.88 a barrel. Brent fell 1.1% to $59.61.

European markets fell 0.8%-1.2%.

AT HOME

Benchmark indices climbed 0.8% each on the first day of the brand new week to extend the winning streak to fifth straight day. Sesnex settled at 36270, up 307 points while Nifty added 82 points to finish at 10888. BSE mid-cap and small-cap indices gained 0.4% and 0.3% respectively. BSE Metal and Energy indices were the top gainers among the sectoral indices, putting on 2% and 1.5% respectively whereas IT index fell 0.4%, becoming top loser, followed by 0.3% lower Realty Consumer durable and Telecom indices.

FIIs net sold stocks and index futures worth Rs 61 cr and 319 cr respectively but net bought stock futures worth Rs 6 cr. DIIs were net sellers to the tune of Rs 77 cr.

Rupee appreciated 35 paise to end at 71.55/$.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.7%-1.5% and SGX Nifty is suggesting about 15 points lower start for our market.

Readers would recall that we had turned our view positive after Nifty crossed immediate hurdle of 10600 last week and had given upside targets of 10740 followed by 10833 and 10941.

Nifty yesterday touched a high of 10900 before closing at 10888 and is set to open marginally lower today.

10941, the top made in early December, continues to be immediate target as well as resistance to eye. Once that is taken out decisively, 11090, the 61.8% retracement level of the entire 11760-10004 fall, would be the next level to eye.

Immediate support on the hourly chart has moved up to 10735, with the stop-loss of which, trading longs can be held on to.