16840-16966 IS THE RESISTANCE ZONE; 16250 MAJOR SUPPORT

 

16840-16966 IS THE RESISTANCE ZONE; 16250 MAJOR SUPPORT

 

WORLD MARKETS

 

US indices fell 1.1%-1.2%, extending the losing streak to third straight day, amid fears about the fast-spreading Covid omicron variant.

 

Omicron variant has now been found in at least 43 U.S. states and 90 countries. WHO said omicron is more contagious than any previous variant of Covid-19. It accounted for 73% of new infections in the U.S. last week.

 

US 10-year treasury yield rose 2 bps to 1.43%. Dollar index eased 0.2% to 96.50. Gold fell 0.4% to $1790 an ounce.

 

Brent crude futures declined $2, or 2.7%, to $71.52 per barrel, while WTI crude futures settled 3.7%, or $2.63, lower at $68.23 per barrel.

 

European markets fell 0.8%-1.9%. The Netherlands entered full lockdown on Sunday until mid-January. From Monday, only German citizens, residents and transit passengers will be allowed to enter Germany from the U.K., with all inbound travelers required to quarantine for 14 days irrespective of vaccination status. Travel restrictions were also imposed for arrivals from Denmark, Norway and France.

 

AT HOME

 

After plunging more than 3%, benchmark indices cut a third of the losses in late noon trade to end lower by just over 2%. Both the indices closed at the lowest level after 23rd August, marking a 4-month low. Sensex settled at 55822, down 1190 points while Nifty lost 371 points to finish at 16614. Nifty mid-cap and small-cap indices fell 3.7% and 4% respectively to close at the lowest level since 2nd September. All the BSE sectoral indices ended in red, with Realty and Oil & Gas indices leading the losses, down 4.7% and 3.8% respectively.

 

FIIs net sold stocks and index futures worth Rs 3565 cr and 1163 cr respectively but net bought stock futures worth Rs 739 cr. DIIs were net buyers to the tune of Rs 2764 cr.

 

Rupee appreciated 18 paise to end at 75.91/$.

 

OUTLOOK

 

Today morning, Asian markets are trading with gains of 0.4%-1.9% and SGX Nifty is suggesting around 150 points higher start for our market.

 

In yesterday's report we had said that 16782, the low made in November, was the next support to eye and that immediate resistance on the hourly chart had moved lower to 17250, with the stop-loss of which, trading shorts could be held on to.

 

Nifty, after plunging all the way to 16410, rebounded to end at 16614. The benchmark is set to open above 16750 today.

 

16840-16966, the gap created by yesterday's gap-down opening, would now act as the immediate resistance zone; 200-DMA, placed around 16250, is the next major support to eye; Meanwhile, trading shorts can be held on to with the stop-loss of 16966.

 

33800, 33100 are next supports for Banknifty; 35231-35535, the gap created by yesterday's gap-down opening, would act as the immediate resistance zone.