10885 CONTINUES TO BE IMMEDIATE HURDLE; 10630 IMMEDIATE SUPPORT

10885 CONTINUES TO BE IMMEDIATE HURDLE; 10630 IMMEDIATE SUPPORT

WORLD MARKETS

US indices gained 0.7%-1.4% on news about a potential coronavirus treatment and continued upmove in tech stocks.

Gilead Sciences said its coronavirus treatment drug, remdesivir, showed an improvement in clinical recovery and a 62% reduction in the risk of mortality compared with standard care.

Brent crude rose 90 cents, or 2.2%, to $43.25 while U.S. oil settled up 93 cents, or 2.3%, to $40.55 a barrel after International Energy Agency raised its 2020 demand forecast to 92.1 million barrels per day (bpd), up 400,000 bpd from its outlook last month,.

Meanwhile, the U.S. reported Thursday more than 63,000 additional coronavirus cases, a record. The country’s seven-day average now stands at more than 53,000 cases.

European markets rose 0.8%-1.3% as data showed French and Italian industry output rebounding more strongly than expected in May. Italian industrial production jumped 42.1% in May from the previous month, outstripping the median forecast of 22.8%. French industry output climbed by 19.6% in May, surpassing expectations of a 15.1% rise.

For the week, US indices gained 0.9%-4% with Nasdaq on the top.

AT HOME

Benchmark indices ended lower by four tenth of a percent after a rangebound but choppy session. Sensex settled at 36594, down 143 points while Nifty lost 45 points to finish at 10768. BSE mid-cap and small-cap indices fell 0.7% and 0.4% respectively. BSE Bankex and Finance indices tumbled 2.2% and 2% respectively, becoming top losers among the sectoral indices while Energy index climbed 2.3%, becoming top gainer, followed by 0.8% higher telecom index.

FIIs net sold stocks, index futures and stock futures worth Rs 1031 cr, 1610 cr and 938 cr respectively. DIIs were net sellers to the tune of Rs 431 cr.

Rupee depreciated 20 paise to end at 75.20/$.

For the week, Sensex and Nifty gained 1.6% and 1.5% respectively, extending the winning streak to fourth consecutive week.

OUTLOOK

The World Health Organization on Sunday reported a record daily rise in global coronavirus cases. Florida reported more than 15,000 new coronavirus infections — the highest single day total to date for any U.S. state.

Today morning, Nikkei and Hang Seng are up 1.5% and 0.3% respectively while Shanghai is down 0.2%. SGX Nifty is suggesting around 50 points higher start for our market.

In Friday's report we had reiterated the view that 10885, where 200 Day Simple Moving Average is placed, continued to be immediate upside target as well as resistance to eye and that 10630 continued to be immediate support, with the stop-loss of which, trading longs could be held on to.

Nifty, after touching a high of 10819, eased to end at 10768 but is set to open above 10800 today.

10885, where 200 Day Simple Moving Average is placed, continues to be immediate upside target as well as resistance to eye. Above 10885, 10935, where 34-month moving average is placed, would be the next target/resistance to eye.

10630 continues to be immediate support, with the stop-loss of which, trading longs can be held on to.