NIFTY EXTENDS WEAKNESS AS EXPECTED; STAY SHORT WITH THE STOP-LOSS OF 10415

NIFTY EXTENDS WEAKNESS AS EXPECTED; STAY SHORT WITH THE STOP-LOSS OF 10415

WORLD MARKETS                             

Dow ended flat while S & P 500 and Nasdaq gained 0.1% and 0.3% respectively

Banks fell after Republicans lost key elections in New Jersey and Virginia on Tuesday which increase uncertainty around the GOP's plans to move forward with tax reform. Banks were also pressured by a flattening yield curve. The spread between the two and the 10-year U.S. bond yields hovered around 70 basis points, its lowest level in a decade.

Trump's tour of Asia also remained in the spotlight. Trump is expected to discuss issues relating to trade and North Korea with Chinese leaders in Beijing today. The president also took to Twitter to warn North Korea not to underestimate the U.S., repeating statements he had made when addressing South Korea's National Assembly on Wednesday.

In Europe, FTSE gained 0.2%, DAX ended flat while CAC and Italy fell 0.2% and 0.6% respectively. Financials and banking stocks underperformed on earnings and doubts over U.S. plans to reform the tax system.

AT HOME

Benchmark indices fell about half a percent, extending the losing streak to second straight day. Sensex lost 152 points to settle at 33219 while Nifty finished at 10303, down 47 points. BSE mid-cap and small-cap indices tumbled 0.8% and 1% respectively. Except 0.4% and 0.1% higher IT and Teck indices respectively, all the BSE sectoral indices ended in red with Metal index leading the tally, down 1.6%, followed by 1.5% lower Energy and Telecom indices.

FIIs net sold stocks, index futures and stock futures worth Rs 3838 cr, 602 cr and 2288 cr respectively. DIIs were net buyers to the tune of Rs 3038 cr.

Rupee appreciated 8 paise to end at 64.95/$.

OUTLOOK

China October PPI and CPI have come in at 6.9% and 1.9% respectively, which are higher than the expected figures of 6.6% and 1.8% respectively.

Today morning, Nikkei is up 1.3%, Hang Seng is up 0.7% and other Asian markets are trading with modest gains. SGX Nifty is suggesting about 25 points higher start for our market.

After Nifty broke the immediate support of 10380 on Tuesday, we had given downside target range of 10250-10200 in yesterday's report and had advised holding on to short positions with the stop-loss of 10450.

Nifty yesterday touched a low of 10285 before closing at 10303 and is set to open modestly higher today.

10250, where previous top on the daily chart is placed, continues to be immediate support below which 10180, where 38.2% retracement level of the 9690-10490 upmove is placed, will be the next support to eye.

Immediate resistance on the hourly chart has moved lower to 10415, with the stop-loss of which, trading shorts should be held on to.

Tata Motors and Aurobindo Pharma will report their quarterly earnings today.

Two-day GST Council meeting begins today. On agenda would be pruning 28% list and libersalisation of composition scheme.

Himachal Pradesh goes to polls today with traditional rivals, the Congress and the BJP locking horns in all 68 constituencies

NIFTY BREAKS IMMEDIATE SUPPORT; STAY SHORT WITH STOP-LOSS OF 10450

NIFTY BREAKS IMMEDIATE SUPPORT; STAY SHORT WITH STOP-LOSS OF 10450

WORLD MARKETS                             

Dow ended marginally in the green, S & P 500 ended flat while Nasdaq fell 0.3% yesterday

Brent crude fell 0.9% to settle at $63.69 a barrel and WTI crude shed 0.3% to settle at $57.20.

European markets fell 0.2%-0.8%

AT HOME

Benchmark indices nosedived nearly a percent, suffering the biggest fall since September 27. Sensex lost 360 points to settle at 33371 while Nifty finished at 10350, down 102 points. BSE mid-cap and small-cap indices tumbled 1.5% and 1.4% respectively. Except 2.1% and 1.2% higher IT and Teck indices respectively, all the BSE sectoral indices ended in red with Healthcare index leading the tally, down 3.5%, followed by 2.2% lower Realty index.

FIIs net bought stocks worth Rs 461 cr but net sold index futures and stock futures worth Rs 768 cr and 905 cr respectively. DIIs were net sellers to the tune of Rs 2046 cr.

Rupee depreciated 35 paise to end at 65.03/$. 10-year bond yield closed at 6.927%, their highest in 6-months.

Lupin share nosedived after company's formulation manufacturing facilities at Goa and Indore (Pithampur Unit II) received warning letter from USFDA.

Cipla reported better-than-expected consolidated profit growth of 17.7% at Rs 435 cr. Revenue rose 8.8% to Rs 4082 cr. EBITDA grew by 18.2% to Rs 804 crore and margin expanded 160 basis points to 19.7%.

BHEL reported lower-than-expected 5.9% y-o-y rise in net profit at Rs 115.4 cr driven by other income of Rs 485 cr. Revenue fell 5.8% to Rs 6168 cr. On EBIDTA level, company reported a loss Rs 95 cr.

OUTLOOK

Today morning, Asian markets are trading with modest cuts and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that the immediate support on the hourly chart has moved up to 10380, which should serve as the stop-loss for trading longs.

Nifty nosedived 102 points points to finish at 10350, breaking this support.

Upon breach of 10340, the low made yesterday, the correction is likely to get momentum and 10250-10200 would be the next downside target as well as the support area to eye.

Immediate resistance on the hourly chart is placed around 10450, with the stop-loss of which, trading shorts should be held on to.

Ashok Leyland, Bharat Forge, Arvind and Petronet will report their quarterly earnings today.

OIL SOARS TO 28-MONTH HIGH; TRAIL STOP-LOSS TO 10380

OIL SOARS TO 28-MONTH HIGH; TRAIL STOP-LOSS TO 10380

WORLD MARKETS                             

Nasdaq and S & P 500 gained 0.3% and 0.1% respectively while Dow ended marginally in the green

Brent crude jumped 3.5% to $64.27 a barrel and U.S. crude added 3% to settle at $57.35, reaching their highest marks since 2015 following a supposed anti-corruption crackdown in Saudi Arabia that resulted in the arrests of billionaire investor Prince Alwaleed bin Talal and other prominent royals, but it is seen by many analysts as a move by Saudi Crown Prince Mohammed bin Salman to consolidate his power.

Broadcom made an unsolicited bid to buy Qualcomm for $103 billion. If that goes through, it would be the largest tech deal in history.

European markets ended mixed with modest changes. Basic resources sector gained the most following surge in oil and positive outlook on other commodities like nickel and copper.

AT HOME

After rising about four tenth of a percent, benchmark indices gave away most of the gains in late noon plunge to end flat to marginally higher. Sensex settled at 33731, up 46 points while Nifty lost 1 point to finish at 10452.  BSE mid-cap and small-cap indices gained 0.5% and 0.3% respectively. BSE Consumer Durable index soared 8.6%, becoming top gainer among the sectoral indices, followed by 1.2% higher Auto index. Telecom and Power indices were the top losers, down 1.1% and 0.6% respectively.

FIIs net bought stocks worth Rs 576 cr but net sold index futures and stock futures worth Rs 929 cr and 733 cr respectively. DIIs were net sellers to the tune of Rs 264 cr.

Rupee depreciated 13 paise to end at 64.68/$.

The investigation units of the Income Tax Department have been alerted to take note of and act upon the revelations from the latest data leak — Paradise Papers. The 13 million-plus files that were leaked show that as many as 714 Indian companies and individuals are linked to offshore entities set up in tax havens.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.3%-0.9% and SGX Nifty is suggesting about 15 points higher start for our market.

We have been advising holding on to long positions with a trailing stop-loss ever since 34-DMA hurdle, placed at 9930, was taken out on 6th October.

On last count we had asked raising stop-loss to 10350 for the next target of 10550. Nifty yesterday touched a high of 10490 but then slipped to end at 10436 and is set to open higher today.

Immediate support has now moved up to 10380, which should serve as the stop-loss for long positions. 10550 continues to be next upside target.

BHEL and Cipla will report their quarterly earnings today.

STAY LONG WITH THE STOP-LOSS OF 10350; 10550 NEXT

STAY LONG WITH THE STOP-LOSS OF 10350; 10550 NEXT

WORLD MARKETS                             

US indices gained 0.1%-0.7% on Friday despite a mixed jobs report for October as markets focused on strong earnings.

US economy added 261000 jobs in October as against expected figure of 310000. The unemployment rate however, came in at 4.1%, a shade below the 4.2% forecast. Average hourly earnings remained flat.

Apple rose more than 2% after reporting strong quarterly earnings and issuing strong guidance for the current quarter.

Main European markets gained 0.1%-0.3% while Italy and Spain fell 0.1% and 1% respectively.

Also in focus in the region was Trump's tour of Asia, with Japan the first of the five nations on the itinerary. On his arrival in Japan, Trump warned that "no dictator" ought to "ever underestimate American resolve." The president will also visit South Korea, China, Vietnam and Philippines during his trip.

AT HOME

Benchmark indices ended higher by about a third of a percent to hit fresh record high. Sensex settled at 33686, up 112 points while Nifty added 29 points to finish at 10452. BSE small-cap index gained half a percent but the mid-cap index fell 0.1%. BSE Capital Goods index climbed 1.1%, becoming top gainer among the secoral indices, followed by 1% higher Bankex and Industrial index. Utilities and Healthcare indices were the top losers, down 0.6% each.

FIIs net sold stocks and index futures worth Rs 9691 cr and 418 cr respectively but net bought stock futures worth Rs 12 cr. Adjusted for Rs 10000 cr Bharti Airtel deal, FIIs were net buyers to the tune of Rs  360 cr. DIIs were net buyers to the tune of Rs 33 cr.

Rupee appreciated 6 paise to close at 64.55/$.

For the week, Sensex and Nifty gained 1.6% and 1.2% respectively, extending the winning streak to second consecutive week.

PNB reported better-than-expected 2% net profit growth at Rs 561 cr for the quarter ended September 2017 and even its asset quality improved over previous quarter. Net interest income grew by 3.5% to Rs 4,015.2 cr, with total advances growth of 4.2% at Rs 4.1 lakh crore. Gross NPA as a percentage of gross advances were lower at 13.31% compared with 13.66% in previous quarter and net NPA also declined to 8.4% from 8.67%.

Hindalco Industries' second quarter profit missed expectations, falling 10.7% year-on-year due to one-time loss but operational numbers beat estimates led by Novelis earnings. Revenue from operations increased 14.4% to Rs 10,308 cr. EBITDA jumped 20.2% to Rs 1,390 crore and margin expanded by 70 basis points to 13.5%.

OUTLOOK

Today morning, Asian markets, except a 0.3% higher Nikkei, are trading with cuts of 0.2%-1% and SGX Nifty is suggesting about 40 points lower start for our market.

Readers would recall that we have been positive on Nifty ever since 34-DMA hurdle placed ar 9930 was taken out on 6th of October and have been asking holding on to long positions with a trailing stop-loss.

Immediate support on the hourly chart has now moved up to 10350, with the stop-loss of which, existing longs should be held on to. Next target on the way up is placed around 10550 where upward sloping trendline adjoining tops made in September 2016 and August 2017 is placed.

10550 ABOVE 10450; TRAIL STOP-LOSS TO 10350

10550 ABOVE 10450; TRAIL STOP-LOSS TO 10350

WORLD MARKETS                             

Dow gained 0.4% while S & P 500 and Nasdaq ended flat after digesting the details of the tax-reform plan proposed by Republicans.

The corporate tax rate would be reduced to 20% from 35% percent under the plan, which also aims to lower the number of income tax brackets.

President Trump, as was widely expected, nominated Jerome Powell, a Federal Reserve governor, to be the next head of the central bank.

Facebook posted better-than-expected quarterly results.

The U.K. central bank (BOE) raised interest rates for the first time in more than a decade, but signaled only gradual easing in the future. British pound fell to $1.3052 after the announcement from $1.32 seen earlier.

In Europe, FTSE rose 0.9% but CAC and DAX ended modestly lower.

AT HOME

It was a day of consolidation as benchmark indices ended modestly lower after a choppy session. Sensex lost 27 points to settle at 33573 while Nifty finished at 10424, down 17 points. BSE mid-cap and small-cap indices however gained 0.5% and 0.4% respectively. BSE Healthcare index soared 2.5%, becoming top gainer among the sectoral indices, followed by 1.3% higher Consumer Durable index. FMCG and Auto indices were the top losers, down 0.9% and 0.6% respectively.

FIIs net bought stocks worth Rs 1033 cr but net sold index futures and stock futures worth Rs 760 cr and 333 cr respectively. DIIs were net sellers to the tune of Rs 457 cr.

Rupee depreciated 1 paise to end at 64.61/$.

Vedanta's second quarter consolidated profit grew by a higher-than-expected 20% to Rs 2986 cr. Revenue jumped 36% to Rs 21590 cr. EBITDA  grew by 21.3 percent to Rs 5,669 crore, but margin contracted by 159 basis points to 26.26 percent compared with corresponding quarter.

Hero MotCorp October sales fell 5% to 6,31,105 units.

OUTLOOK

Today morning, Asian markets are trading mixed and SGX Nifty is suggesting a marginally higher start.

Nifty, after achieving 10440 target on Wednesday, consolidated yesterday by ending 17 points lower at 10424.

10450 has been the intraday top for past two days and once that is taken out, 10550-10600, the next major target as well as resistance zone, would come into picture.

Meanwhile, immediate support on the hourly chart has moved up to 10350, with the stop-loss of which, existing longs should be held on to.

NIFTY ACHIEVES 10440 TARGET; TRAIL STOP-LOSS TO 10320

NIFTY ACHIEVES 10440 TARGET; TRAIL STOP-LOSS TO 10320

WORLD MARKETS                             

Dow and S & P 500 gained about a fifth of a percent but Nasdaq fell 0.2% after the Federal Reserve kept interest rates unchanged.

The Fed kept interest rates unchanged, as was widely expected. The central bank did not explicitly signal when the next interest rate hike would come, but said economic activity in the U.S. was "rising at a solid rate."

Data from ADP and Moody's showed addition of 235000 jobs in October by the U.S. private sector, which was higher than the expected 2 lakh figure. The ISM manufacturing index in October hit 58.7, a touch better than the 58.6 forecast.

U.S. crude briefly rose more than 1% before settling 0.15% lower at $54.30 per barrel after data showed the draw in U.S. crude stocks fell short of the level earlier reported by the American Petroleum Institute. Gold prices rose 0.5% to settle at $1,277.30 an ounce

In Europe, FTSE and Spain ended marginally lower while DAX soared 1.8% and France and Italy were up 0.2% and 0.9% respectively. Basic resources stocks rose the most following positive manufacturing data released in China and strong gains in metal prices.

AT HOME

Benchmark indices soared more than a percent to hit fresh record high. Sensex added 387 points to settle at 33600 and Nifty finished at 10440, up 105 points. BSE mid-cap and small-cap indices gained 0.8% and 1% respectively. BSE Telecom and Realty indices climbed 3.9% and 2.9% respectively, becoming top gainers among the sectoral indices while Consumer Durable and Auto indices fell 0.6% and 0.2% respectively.

FIIs net bought stocks and stock futures worth Rs 1039 cr and 225 cr respectively but net sold index futures worth Rs 49 cr. DIIs were net sellers to the tune of Rs 668 cr.

Rupee closed at 64.59/$, appreciating 16 paise and closing at the strongest level since September 20.

Maruti Suzuki reported lower-than-expected 10% rise in October sales at 1.46 lakh units. Escort tractor sales were up 13.8% at 10205 units. Eicher Motor posted 18% rise in Royal Enfield sales at 69492 units. Ashok Leyland total sales rose 3% to 12914 units. Tata Motors domestic sales were up 5% at 48886 units. M & M's total auto sales were down 2% at 51149 units and tractor sales dipped 11% to 40262 units.

India's Nikkei manufacturing PMI fell to 50.3 in October from 51.2 in September.

Hero MotoCorp posted 0.6% y-o-y growth in September quarter net profit at Rs 1010 cr. Revenue rose 7.3% to Rs 8362 cr and sales volume was up 11%. EBIDTA rose 6.3% to Rs 1456 cr but margin contracted 20 bps to 17.4%.

Tech Mahindra reported 4.7% q-o-q rise in September quarter net profit at Rs 836 cr. Rupee revenue was up 3.7% at Rs 7606 cr while Dollar revenue was up 3.6% at $1179.2 mn. EBIT rose 22.2% to Rs 840 cr and margins expanded 160 bps to 11%.

OUTLOOK

Today morning, Asian markets are trading mixed with modest changes and SGX Nifty is suggesting a marginally lower start for our market.

We had been working with the target of 10440 after 10340, the top made after the gap up opening following the bank recpitalisation news, was taken out. Nifty yesterday touched a high of 10451 before closing at 10440, achieving this target and vindicating our view.

10550-10600 is the next major target as well as resistance zone. Immediate support on the hourly chart has moved up to 10320, with the stop-loss of which, trading longs should be held on to.

Vedanta, Glenmark and Powergrid will report their quarterly earnings today.

Bank of England, at its policy meeting today, is expected to raise interest rates for the first time in more than 10 years.

10440 CONTINUES TO BE IMMEDIATE TARGET; 10270 IMMEDIATE SUPPORT

10440 CONTINUES TO BE IMMEDIATE TARGET; 10270 IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow and S & P 500 gained 0.1% each while Nasdaq climbed 0.4%, awaiting Fed decision, tax reform details expected later this week and President Donald Trump's upcoming announcement regarding the next chair of the Fed. Both the Dow Jones industrial average and the S&P 500 notched their seventh consecutive monthly gains.

U.S. consumer confidence in October rose to its highest levels in nearly 17 years.

Brent crude futures rose 0.7% to settle at $61.37 a barrel and U.S. crude advanced 0.4% to settle at $54.38.

European markets gained 0.1%-0.7% with Spain on the top.

AT HOME

Benchmark indices ended lower by about a fifth of a percent. Sensex lost 53 points to settle at 33213 while Nifty finished at 10335, down 28 points. BSE mid-cap and small-cap indices however outperformed, rising 0.1% and 0.5% respectively. BSE Realty index soared 3%, becoming top gainer among sectoral indices, followed by 1.5% higher Telecom index. Metal and Utilities indices were the top losers, down 1.8% and 0.7% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 532 cr, 630 cr and 315 cr respectively. DIIs were net buyers to the tune of Rs 597 cr.

Rupee appreciated 10 paise to end at 64.75/$.

Bharti Airtel reported 6.6% q-o-q dip in September quarter net profit at Rs 343 cr dented by pricing pressure in India business; but operational earnings and Africa business beat estimates. Revenue fell 0.8% to Rs 21777 cr. EBIDTA rose 2.3% to Rs 8004 cr and margin expanded by 120 bps to 36.8%.

Dr Reddy reported 3.4% y-o-y dip in September quarter net profit at Rs 285 cr. Revenue fell 1.1% to Rs 3546 cr. EBIDTA rose 7.3% to Rs 689 cr and margin expanded by 150 bps to 19.4%.

In the World Bank's Ease of Doing Business rankings, India jumped 30 notches from last year to reach 100th rank, in an endorsement of the string of reforms implemented by the Narendra Modi government.

Eight core sectors grew to a six-month high of 5.2% in September, up from 4.4% in August, helped by a robust performance in coal, natural gas and refinery segments.

India's fiscal deficit at the end of the first half of the current fiscal touched 91.3% of the budget estimate, mainly due to rise in expenditure.

OUTLOOK

Today morning, Nikkei is 1.2%, other Asian markets are trading with gains of upto half a percent and SGX Nifty is suggesting about 40 points higher start for our market.

We have been working with target of 10440 after 10340, the top made after the gap up opening following the bank recpitalisation news, was taken out. Nifty, after touching a high of 10384 on Monday, eased to end at 10335 yesterday but is set to open higher today.

10440 continues to be immediate target to eye above which 10550-10600 would be the next target area.

10270 continues to be immediate support on the hourly chart, with the stop-loss of which, trading longs should be held on to.

The Federal Reserve will deliver its interest rates decision at the end of its two-day meeting where no changes are expected.