7832 IS THE SUPPORT; 8600, 9000 HURDLES

7832 IS THE SUPPORT; 8600, 9000 HURDLES

WORLD MARKETS

After falling more than 3% in the initial trade, US indices saw a sustained upward move through the session to end with gains of 0.5%-2.3%, with Nasdaq leading the gains.

Energy stock climbed after WTI crude rallied 23.8%, its biggest one-day move ever, to $25.22 per barrel. Brent futures gained 14.4% to $28.47 per barrel.

The dollar index jumped 1.5% to 102.67, its highest level since January 2017.

The European Central Bank announced a new Pandemic Emergency Purchase Program that will deploy €750 billion ($819 billion) to purchase securities to help support the European economy. Purchases will be conducted until the end of 2020 and include a variety of assets including government debt.

The Bank of England announced another surprise interest rate cut on and ratcheted up its bond-buying program, in an effort to offset the economic impact of the coronavirus outbreak.

European markets gained 1.4%-2.7%. German ifo Business Climate Index plummeted from 96.0 in February to 87.7 in March, the biggest drop since 1991 and bringing the index to its lowest level since August 2009.

AT HOME

After plunging more than 7% in the initial trade, Sensex and Nifty  recouped more than half of the losses through the session to end lower by 2% and 2.4% respectively to close at fresh three year low. Sensex settled at 28288, down 581 points while Nifty lost 205 points to finish at 8263. BSE mid-cap and small-cap indices fell 3.7% and 4.5% respectively. Except a 1.7% higher Telecom index, all the BSE sectoral indices ended in red with Metal and Capital Goods indices leading the losses, down 7.2% and 6.2% respectively.

FIIs net sold stocks worth Rs 4623 cr but net bought index futures and stock futures worth Rs 45 cr and 1096 cr respectively. DIIs were net buyers to the tune of Rs 4367 cr.

Rupee depreciated 82 paise to end at 75.08/$.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.7%-2.6% and SGX Nifty is suggesting about 50 points lower start for our market.

In yesterday's report we had said that 8300, where a trendline adjoining bottoms made in December 2011 and August 2013 was placed, was the next support to eye, below which 8020, where 500-week moving average is placed, would be the next crucial and major support.

Nifty achieved 8020 target and went further lower to 7832, from where it rebounded sharply to end at 8263. The benchmark might start near 8200 today.

7832, the low made yesterday, is the support to eye. If 7832 gives way, 7500, where a trendline adjoining bottoms made in October 2012 and August 2013 is placed, would be the next support.

8600, 8995 and 9390, the 33%, 50% and 67% retracement levels of the recent 10160-7832 fall, are the resistance levels to eye.