TRAIL STOP-LOSS TO 19635

 

TRAIL STOP-LOSS TO 19635

 

WORLD MARKETS

 

Dow inched up 0.1% but S & P 500 and Nasdaq fell 0.5% and 1.2% respectively on Friday.

 

University of Michigan’s closely watched preliminary consumer sentiment index slumped in October while inflation expectations spiked.

 

Israel said its infantry and tanks had carried out raids inside the Gaza Strip, its first announcement of a shift from an air war to ground operations.

 

U.S. 10-year treasury yield fell 9 bps to 4.612%. Dollar index rose 0.1% to 106.67. Gold surged 3.4% to $1932 per ounce.

 

WTI crude futures jumped 5.8% to settle at $87.7 per barrel for the best day since April 3. Brent  futures with December expiry climbed 5.7% to $90.89 per barrel.

 

European markets fell 0.6%-1.6%

 

China’s consumer price index for September came in flat, lower than a 0.2% climb expected. China also reported a 2.5% decline for its producer price index, compared to estimates of a 2.4% drop. China’s trade data for September showed exports and imports both shrank at a slower pace for a second month.

 

For the week, Dow and S & P 500 gained 0.8% and 0.4% respectively while Nasdaq fell 0.2%. WTI crude gained more than 4% this week, posting its biggest weekly gain since Sept. 1. Dollar index rose half a percent. Gold surged 5.4% for its best week in seven months.

 

AT HOME

 

After starting lower by eight tenth of a percent, benchmark indices recouped lot of the losses to end lower by a fifth of a percent. Sensex settled at 66282, down 125 points while lost 43 points to finish at 19751. Nifty mid-cap and small-cap indices fell 0.1% and 0.5% respectively. Nifty PSU Bank and Media indices were the top losers among the sectoral indices, down 1.4% and 1.2% respectively while Auto and Realty indices were the top gainers, up 0.9% and 0.4% respectively.

 

FIIs net bought stocks worth Rs 317 cr but net sold index futures and stock futures worth Rs 784 cr and 5 cr respectively. DIIs were net sellers to the tune of Rs 103 cr.

 

India's September exports fell 2.6% y-o-y to $35.4 bn while imports fell 15% to $53.8 bn. Trade deficit fell 31% to $19.4 bn.

 

For the week, Sensex and Nifty gained 0.4% and 0.5% respectively, extending the winning streak to second straight week.

 

OUTLOOK

 

Today morning, Nikkei is down nearly 2% while Hang Seng and Shanghai are down 0.3% each. GIFT Nifty is suggesting a modestly lower start for our market.

 

In Friday's report we had said that 19882, the 61.8% retracement level of the recent fall, continued to be next upside target while 19650-19600 was the immediate support on the hourly chart, with the stop-loss of which, trading longs could be held on to.

 

Nifty, after touching a low of 19635, rebounded to end at 19751.

 

19635, the low made on Friday, coincided with a trendline adjoining recent bottoms and hence is the immediate support to eye. Below 19635, 19480, the low made during the week, followed by 19333, the low made last week, would be next downside levels to eye. On the way up, 19882, followed by 20032, the 61.8% and 78.6% retracement levels of the recent 20222-19333 fall, are the upside levels to eye. Meanwhile, trading longs can be held on to with the stop-loss of 19635.

 

For Banknifty, 44710, the top made last week, around which 34-DMA is also placed, is the important immediate hurdle, upon crossover of which, 45050 and 45350, the 50% and 61.8% retracement levels of the recent fall, would be next upside targets; 43800, the low made during the week, is the immediate support, upon breach of which, 43600 followed by 43345, the bottoms made in August and June respectively, would be next downside levels to eye.

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