16200 IS THE NEXT SUPPORT; TRAIL STOP-LOSS TO 17000

 

16200 IS THE NEXT SUPPORT; TRAIL STOP-LOSS TO 17000

 

WORLD MARKETS

 

US indices nosedived 3.1%-5% with Dow and Nasdaq notching their worst single-day drops since 2020 and giving away more than they had gained in the previous session.

 

Weekly jobless claim numbers came in slightly higher than expected while a labor productivity reading for the first quarter showed the fastest decline since 1947.

 

US 10-year treasury yield jumped to 3.106% before closing 10 bps higher at 3.04%. Dollar index jumped 1% to 103.55. Gold, after touching a high of $1910, slipped to end 0.25% lower at $1877 per ounce.

 

Brent futures added 76 cents to settle at $110.90 per barrel and WTI crude settled 45 cents higher at $108.26 per barrel.

 

In Europe, exccept 0.1% higher FTSE, other markets fell 0.4%-0.8%. Sterling fell to its lowest level since June 2020 after the Bank of England raised interest rates to their highest since 2009 but warned that the economy was at risk of recession. The euro also slipped after German data showed that industrial orders in March suffered their biggest monthly drop since last October.

 

China's Caixin services PMI declined to 36.2 for April from March’s reading of 42.

 

AT HOME

 

After rising a percent and half in the first hour, benchmark indices gave away all the gains through rest of the session to end little changed. Sensex settled at 55702, up 33 points while Nifty inched up 5 points to finish at 16682. Nifty mid-cap index inched up 0.1% but small-cap index fell 0.8%. BSE IT and Teck indices climbed 1.9% and 1.8% respectively, becoming top gainers among the sectoral indices while Realty index tumbled 1.6%, becoming top loser, followed by 0.6% lower Healthcare index.

 

FIIs net sold stocks worth Rs 2075 cr but net bought index futures and stock futures worth Rs 1054 cr and 2243 cr respectively. DIIs were net buyers to the tune of Rs 2229 cr.

 

Rupee appreciated 16 paise to end at 76.25/$.

 

India's April Services PMI rose to 57.9 from 53.6 month-on-month. Composite PMI improved to 57.6 from 54.3.

 

Marico's results were largely in-line with expectation while Volas disappointed on operational performance.

 

OUTLOOK

 

Today morning, Hang Seng and Shanghai are down 2.4% and 1.4% respectively while Nikkei is off 0.2%. SGX Nifty is suggesting around 250 points lower start for our market.

 

In yesterday's report we had said that 16600, the 61.8% retracement level of the entire 15671-18115 upmove, was the downside level to eye below which, 16200, the 78.6% retracement level of this upmove, would be the next support. We had also advised holding on to short positions with the stop-loss of 17100.

 

Nifty, after touching a high of 16945, slipped to end at 16682 and is set to open below 16500 today.

 

16200, the 78.6% retracement level of 15671-18115 upmove, is the next downside level to eye; Immediate hurdle on the hourly chart has moved lower to 17000, with the stop-loss of which, trading shorts can be held on to.

 

34680 followed by 33570, the 61.8% and 78.6% retracement levels of the 32155-38765 upmove, are the downside levels to eye for Banknifty; 36000 is immediate hurdle.