NIFTY ACHIEVES 11981 TARGET; TRAIL STOP-LOSS TO 11835

NIFTY ACHIEVES 11981 TARGET; TRAIL STOP-LOSS TO 11835

WORLD MARKETS

US indices gained 0.4%-0.6% to hit record highs in the backdrop of strong earnings, a rebound in economic data and a potential U.S.-China trade deal.

On Sunday, U.S. Commerce Secretary Wilbur Ross said that licenses would be granted “very shortly” for American firms to sell to Chinese telecommunications giant Huawei. Ross also offered more detail on a prospective partial deal expected to be signed by President Donald Trump and Chinese President Xi Jinping.

Ross also said Washington may not need to impose its planned 5-15% tariffs on European and Asian cars following positive discussions.

European markets rose 0.9%-1.4%

Brent crude rose 47 cents to $62.17 a barrel while US WTI gained 34 cents to $56.54.

AT HOME

Sensex and Nifty added 0.3% and 0.4% respectively, extending the winning streak to seventh consecutive day. Sensex added 136 points to settle at 40301 while Nifty finished at 11941, up 50 points. For Sensex, this is the record closing high while for Nifty this is the highest finish since 4th July.  BSE mid-cap index ended flat while small-cap index rose 0.2%. BSE Metal and Telecom indices surged 3.2% and 2.1% respectively, becoming top gainers among the sectoral indices while Auto and Consumer Discretionary Goods & Services indices fell 1.3% and 0.8% respectively, becoming top losers.

FIIs net sold stocks and stock futures worth Rs 139 cr and 271 cr respectively but net bought index futures worth Rs 199 cr. DIIs were net sellers to the tune of Rs 500 cr.

Rupee appreciated 4 paise to end at 70.77/$.

HDFC Q2 numbers beat expectations. NII rose 16.2% y-o-y to Rs 3077 cr while Net profit soared 60.6% to Rs 3961.5 cr. Net interest margin remained unchanged at 3.3% q-o-q.

OUTLOOK

Today morning, Nikkei is up more than a percent while Hang Seng and Shanghai are little changed. SGX Nifty is suggesting a marginally lower start for our market.

Readers would recall that after Nifty achieved 11798 target, we had given 11940-11980 as the next target zone. The benchmark touched a high of 11989 yesterday before closing at last week before closing at 11941, achieving 11980 target and vindicating our view.

We had initiated bullish stance on Nifty ever since 11320 hurdle was taken out and have been advising holding on to long positions with a trailing stop-loss and that continues continues to be the advise.

Upon decisive crossover of 11981 hurdle, 12103, the top made in June, would be the next big target/resistance to eye.

Immediate support on the hourly chart has moved up to 11835, with the stop-loss of which, long positions can be held on to.

Tech Mahindra and Titan will report their quarterly earnings today.