NIFTY NEARS 20-DMA

 

NIFTY NEARS 20-DMA

 

WORLD MARKETS

 

After starting 2% lower on the back of disappointing bank earnings, US indices recouped most of the losses through the session to end flat to modestly lower.

 

JPMorgan Chase fell 3.5% after the bank added to reserves for bad loans and halted its share buybacks, signaling a more cautious economic outlook. Morgan Stanley slipped 0.4% on the back of a sharp decline in investment banking revenue.

 

June’s producer price index showed wholesale prices rose 11.3% versus a year ago last month as energy prices jumped.

 

US 10-year Treasury yield rose 3 bps to 2.965% while 2-year yield fell 2 bps to 3.138%. Dollar index surged 0.6% to 108.64. Spot gold fell 1.47% to $1,709.66 per ounce.

 

Oil pared nearly all losses after falling more than $4 earlier in the session. Brent September futures settled down 47 cents, or 0.5% to $99.10 a barrel and WTI August future settled 0.5% lower at $95.78 a barrel.

 

European markets fell 1.4%-1.9%.

 

AT HOME

 

After rising two third of a percent in the initial trade, benchmark indices saw a sustained downward move through the session to end lower by a fifth of a percent, extending the losing streak to fourth straight day. Sensex settled at 53416, down 98 points while Nifty lost 28 points to finish at 15938. Nifty mid-cap and small-cap indices fell 0.1% and 1.1% respectively. BSE IT and Teck indices tumbled 1.4% and 1.1% respectively, becoming top losers among the sectoral indices while Oil & Gas and Energy indices were the top gainers, up 1.6% and 1.1% respectively.

 

FIIs net bought stocks worth Rs 309 cr but net sold index futures and stock futures worth Rs 602 cr and 473 cr respectively. DIIs were net sellers to the tune of Rs 556 cr.

 

Rupee depreciated 25 paise to end at 73.88/$.

 

India's June WPI inflation came in at 15.18%, down from 15.88% in the previous month. Core WPI eased to 9.2% from 10.50%.

 

OUTLOOK

 

Today morning, Nikkei is up 0.3% while Hang Seng and Shanghai are down 0.9% and 0.1% respectively. SGX Nifty is suggesting around 40 points higher start for our market.

 

In yesterday's report we had said that Nifty had confirmed a "Sell" on the hourly chart and that 20-DMA, placed around 15800 was the next downside level to eye.

 

Nifty, after touching a high of 16070, slipped to 15858 before closing at 15938.

 

20-DMA, placed around 15810, continues to be downside support to eye; 16100-16150 is the immediate resistance zone, with the stop-loss of which, trading shorts can be held on to.

 

34550-34400 is the support zone for Banknifty; 35100 is immediate hurdle.