STAY SHORT WITH THE STOP-LOSS OF 10770

STAY SHORT WITH THE STOP-LOSS OF 10770

WORLD MARKETS

US indices climbed 0.9%-2.1% as a rise in energy and materials stocks and the start of earnings season shares overshadowed rising Covid cases.   

JPMorgan Chase reported better-than-expected results on the back of a massive surge in trading revenue. Wells Fargo suffered a $2.4 billion loss and cut its dividend to 10 cents per share.

Meanwhile, President Donald Trump said that he signed legislation to impose sanctions on China in response to its interference with Hong Kong’s autonomy.

Brent futures gained 18 cents, or 0.4%, to settle at $42.90 per barrel while WTI futures settled 19 cents, or 0.5%, higher at $40.29 per barrel.

In Europe, except 0.1% higher FTSE, other markets fell 0.6%-1%.  U.K. GDP expanded by 1.8% in May, following April’s historic 20.4% contraction, but missed the estimate of a 5.5% rebound.

AT HOME

Benchmark indices nosedived 1.8% each, suffering the worst fall since 11th June and closing at the lowest level since 3rd July. Sensex lost 660 points to settle at 36033 while Nifty finished at 10607, down 195 points. BSE mid-cap and small-cap indices fell 0.9% each. Except 0.1% higher Telecom and flat Healthcare indices, all the BSE sectoral indices ended in red with Bankex and Power indices leading the losses, down 3.1% and 2.7% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 1566 cr, 1645 cr and 1418 cr respectively. DIIs were net sellers to the tune of Rs 650 cr.

Rupee depreciated 22 paise to end at 75.41/$.

India's wholesale price inflation stood at -1.81% in June as against -3.21% in the previous month.

Wipro’s revenue missed estimate but margin was a beat.

OUTLOOK

US futures are up nearly a percent, reacting to news that Moderna’s coronavirus vaccine produced antibodies in all patients in an early trial.

Nikkei and Hang Seng are up 1.3% and 0.9% respectively while Shanghai is off 0.3%. SGX Nifty is suggesting around 80 points higher start for our market.

In yesterday's report we had said that 10894, the top made Monday, which coincided with the 200 day simple moving average, continued to be immediate hurdle and that 10630 continued to be immediate support, with the stop-loss of which, trading longs can be held on to.

Nifty broke 10630 support and plunged all the way to 10563 before closing at 10607 and is set to open near 10700 today.

10544, followed by 10425, which are the 50% and 67% retracement levels of recent 10194-10894 upmove, are the downside targets/supports to eye.

10770 is the immediate hurdle on the hourly chart, with the stop-loss of which, trading shorts can be held on to.

Infosys will report its quarterly earnings today.