10980 CONTINUES TO BE IMMEDIATE HURDLE; 10816 NEAREST SUPPORT

10980 CONTINUES TO BE IMMEDIATE HURDLE; 10816 NEAREST SUPPORT

WORLD MARKETS

Dow and S & P 500 rose 0.3% and 0.1% respectively while Nasdaq fell 0.2% on Friday after digesting August employment report.

The U.S. economy added 130,000 jobs in August, lower than the expected 150000 mark. Unemployment remained steady at a rate of 3.7% while wages expanded by 0.4% month-on-month and by 3.2% y-o-y.

Fed Chairman Powell said the central bank will act as needed to sustain the current economic expansion, noting he does not expect the U.S. economy to fall into a recession.

Treasury yields dipped from their session highs on the jobs data with the 10-year  yield down to 1.57% from around 1.6% earlier in the day.

Main European markets gained 0.2%-0.5%. Euro zone GDP expanded by 0.2% in the second quarter, after a 0.4% expansion in the first three months of the year.

Brent crude rose 52 cents, or 0.9%, tot $61.47 a barrel, while WTI crude rose 22 cents, or 0.4%, to settle at $56.52.

For the week, the Dow and S&P 500 both gained 1.5% while the Nasdaq climbed 1.8%.

Data released yesterday showed China's August exports fell 1% on-year, as against estimate of a 2% rise. Earlier, on Friday, the Chinese central bank said the reserve requirement ratio would be cut by 50 basis points and it would further reduce that ratio by 100 basis points for some qualified banks.

AT HOME

After a positive start, benchmark indices saw a sustained northward move through the session to end higher by nine tenth of a percent, with Nifty extending the winning streak to third straight day. Sensex added 337 points to settle at 36981 while Nifty added 98 points to finish at 10946. BSE mid-cap and small-cap indices gained 0.6% and 0.8% respectively. Except  0.7% and 0.2% lower Realty and FMCG indices respectively, all the BSE sectoral indices ended in green with Auto and Power indices leading the tally, up 2.5% and 2.1% respectively.

FIIs net sold stocks and stock futures worth Rs 957 cr and 375 cr respectively but net bought index futures worth Rs 309. DIIs were net buyers to the tune of Rs 1207 cr.

Rupee appreciated 12 paise to end at 71.12/$.

For the week, Sensex and Nifty lost 0.9% and 0.7% respectively.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.2%-0.8% and SGX Nifty is suggesting a marginally higher start for our market.

In Friday's report we had said that 10980 continues to be immediate hurdle while 10746, the low made Wednesday, continues to be immediate support.

On Friday, Nifty surged to touch a high of 10957 before closing at 10946 and is set to open modestly higher today.

10980 continues to be immediate hurdle, a crossover of which is required to generate a "Buy" on the hourly chart. If that happens, 11140-11200 would be the next target zone.

Meanwhile 10816, the low made Thursday, is the immediate support below which, 10746, the low made last week, would be next support to eye.