10838 IS THE IMMEDIATE HURDLE; 10610 IMMEDIATE SUPPORT

10838 IS THE IMMEDIATE HURDLE; 10610 IMMEDIATE SUPPORT

WORLD MARKETS

Dow gained 0.3% while S & P 500 ended flat and Nasdaq fell 0.4% after digested new developments in the ongoing U.S.-China trade war.

On Wednesday, Reuters reported Chinese state-owned companies had bought more than 1.5 million tons of U.S. soybeans, marking first major U.S. soybean purchases in more than six months.

US crude rose 2.8% to $52.58 and Brent added $1.19 or 2% at $61.34 after data showed inventory declines in the United States and on expectation that the global oil market could have a deficit sooner than previously thought.

The European Central Bank said it's bringing to an end a crisis-era bond-buying program this month. Bond purchases by the ECB will fall from 15 billion euros ($17.04 billion) a month to zero by the end of December, but the central bank plans to spend cash from maturing bonds to purchase additional debt. The euro slipped after the ECB announcements.

In Europe, FTSE and DAX ended flat, CAC was down 0.3% while Italy and Spain gained 0.5% and 0.8% respectively.

AT HOME

Sensex and Nifty gained 0.4% and 0.5% respectively to extend winning streak to third straight day. Sensex added 151 points to settle at 35930 while Nifty finished at 10792, up 54 points. BSE mid-cap and small-cap indices climbed 0.8% and 0.6% respectively. BSE Consumer Durables and Capital Goods indices climbed 1.4% and 1.3% respectively, becoming top gainers among the sectoral indices while Metal and Telecom indices fell 0.6% and 0.4% respectively, becoming top losers.

FIIs net bought stocks and index futures worth Rs 675 cr and 2396 cr respectively but net sold stock futures worth Rs 96 cr. DIIs were net sellers to the tune of Rs 52 cr.

Rupee appreciated 33 paise to end at 71.68/$.

OUTLOOK

Today morning, Nikkei and Hang Seng are down 1.4% and 1.2% respectively while Shanghai is off 0.2%. SGX Nifty is suggesting about 50 points lower start for our market.

In yesterday's report we had said that 10821-10833, the gap created by a gap down opening on last Wednesday, 5th December, is the next resistance to eye.

Nifty, after touching a high of 10838, slipped to end at 10791 and is set to open around 10750 today.

10838, the top made yesterday, is the immediate hurdle, upon crossover of which, 10941, the top made in early December, would be the bigger resistance to eye.

Immediate support on the hourly chart is placed around 10610, with the stop-loss of which, trading longs can be held on to.

10821-10833 IS THE NEXT RESISTANCE ZONE; 10600 IMMEDIATE SUPPORT

10821-10833 IS THE NEXT RESISTANCE ZONE; 10600 IMMEDIATE SUPPORT

WORLD MARKETS

After gaining nearly 2% in the first half, US indices gave away more than half of the gains in later half to end with gains of 0.5%-1%.

The Wall Street Journal reported China is working to increase access to foreign companies, a move aimed at smoothing U.S.-China trade relations. The plan would replace the country's Made in China 2025 initiative, which is a framework aimed at making China a leader in industries like clean-energy cars and robotics, and has been a point of contention in the tariff fight between Washington and Beijing.

US President Trump, on Tuesday said, talks between Washington and Beijing were ongoing and confirmed he would not raise tariffs on Chinese imports until he was sure about a comprehensive trade agreement.

US oil fell 50 cents or 1% to $51.15 a barrel and Brent fell 5 cents to $60.15.

European markets suged 1.1%-2.2%. U.K Prime Minister Theresa May won a crucial vote of confidence in her leadership. The pound rose about 1% on the news.

AT HOME

Extending Tuesday's mammoth pullback, Sensex and Nifty soared 1.8% each in today's trade. Sensex added 629 points to settle at 35779 while Nifty finished at 10737, up 188 points. BSE mid-cap and small-cap indices climbed 2.5% each. All the BSE sectoral indices ended in green with Realty and Auto indices leading the tally, up 4.1% and 3.6% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 1299 cr, 489 cr and 5 cr respectively. DIIs were net buyers to the tune of Rs 1121 cr.

Rupee depreciated 16 paise to end at 72.01/$.

Dr Reddy tumbled 4.4% after a U.S. appeals court temporarily prevented it from selling a generic version of Indivior Plc’s Suboxone opioid addiction treatment drug in its biggest market.

India's November CPI eased to a 17-month low of 2.3% in November from 3.31% in October. Core inflation stood at 5.8%, down from 6.2% in the previous month. October IIP surged 8.1%, the fastest pace in 11-months, as against 4.5% in September.

OUTLOOK

Today morning, Shanghai is flat while Hang Seng and Nikkei are up about half a percent each. SGX Nifty is suggesting about 50 points higher start for our market.

In yesterday's report we had said that 10560-10600 was the immediate resistance zone, above which, 10710-10740, which are the 61.8% and 67% retracement levels of the recent 10940-10333 fall, would be the next resistance zone to eye.

Nifty crossed 10600 hurdle in the initial trade and surged all the way to 10752 before closing at 10737 and is set to open above 10750 today.

10821-10833, the gap created by a gap down opening on last Wednesday, 5th December, is the next resistance to eye. If Nifty is able to take out this hurdle as well, 10941, the top made on 3rd December, would be the next major target as well as resistance to eye.

Immediate support on the hourly chart is placed around 10600, with the stop-loss of which, trading longs can be held on to.

NIFTY REBOUNDS FROM 10360-10310 SUPPORT ZONE; 10600 IS THE IMMEDIATE HURDLE

NIFTY REBOUNDS FROM 10360-10310 SUPPORT ZONE; 10600 IS THE IMMEDIATE HURDLE

WORLD MARKETS

After rising about a percent and half at the open, US indices gave away all the gains through the session to end mixed with modest changes amid fresh uncertainties surrounding U.S.-China trade relations and the possibility of a government shutdown in Washington.

The higher start was attributed the news that China is moving toward cutting tariffs on cars made in the U.S. to 15% from the current 40%. In addition, Chinese Vice Premier Liu He was reportedly in discussion with U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer, with the aim of de-escalating a global trade war. Trump also tweeted the US administration was having "very productive conversations going on with China," adding: "Watch for some important announcements."

However, news reports that the U.S. will condemn China over hacking and economic espionage, dampened some of the initial optimism. Also weighing on the sentiment was the threat of government shutdown from Trump if more money was not allocated towards building a wall along the U.S.-Mexico border.

US crude rose 65 cents to $51.65 while Brent was up 23 cents at $60.20 a barrel.

European markets gained 1%-1.5%. On the data front, German economic sentiment improved slightly in December to -17.5 from -24.1 in November.

AT HOME

After opening with cuts of nearly percent and half, Benchmark indices soared about 2% from the bottom of the day to end higher by nearly half a percent. Sensex settled at 35150, up 190 points while Nifty added 60 points to finish at 10549. BSE mid-cap and small-cap indices climbed 1.5% each. Except 0.2% lower Oil & Gas index, all the BSE sectoral indices ended in green with Consumer Durable index leading the tally, up 2.6%, followed by 1.9% higher Healthcare index.

FIIs net sold stocks and index futures worth Rs 2421 cr and 636 cr respectively but net bought stock futures worth Rs 672 cr. DIIs were net buyers to the tune of Rs 2255 cr.

Rupee depreciated 51 paise to end at 71.85/$, the lowest level since November 16.

Congress put up a stellar show in the assembly elections held recently by winning 100 out of 200 seats in Rajathan, 68 out of 90 seats in Chhattisgarh and 114 out of 230 seats in Madhya Pradesh. TRS won 88 out of 119 seats in Telangana while in Mizoram, MNF won 26 out of 40 seats.

Government yesterday appointed Shaktikanta Das, member of the 15th Finance Commission and former Economic Affairs Secretary, as the new Reserve Bank of India (RBI) Governor.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.3%-1.6% with Nikkei on the top and SGX Nifty is suggesting a marginally higher start for our market.

In yesterday's report we had said that "10360 and 10310 are the 61.8% and 67% retracement levels of the entire 10004-10941 upmove, making 10360-10310 an important support zone".

Nifty, after touching a low of 10333, rebounded sharply to end at 10549, holding on to support zone mentioned above and vindicating our view.

10560-10600, the gap created by Monday's gap down opening, continues to be immediate hurdle, a sustained trading above which is required for fresh upmove. If that happens, 10710-10740, which are the 61.8% and 67% retracement levels of the recent 10940-10333 fall, would be the next resistance zone to eye.

India's November CPI will be out today and is expected to cool-off to 2.8% from 3.31% in October. October IIP will also be released today and is expected to show a growth of 5.7%, up from 4.5% in September.

GAP-DOWN OPENING AWAITS ON RBI GOVERNOR’S EXIT; ASSEMBLY ELECTION RESULTS IN FOCUS

GAP-DOWN OPENING AWAITS ON RBI GOVERNOR’S EXIT; ASSEMBLY ELECTION RESULTS IN FOCUS

WORLD MARKETS

After falling nearly 2% in the initial trade, US indices recouped all the losses and some more to end with gains of 0.1%-0.7%. Shares of technology companies posted strong rebounds across the board.

Initial selling was attributed to a flattening yield curve and a delayed Brexit vote in the United Kingdom. The spread between the short-term 2-year Treasury note yield and its 10-year counterpart further narrowed, potentially signaling an economic slowdown is ahead.

UK Prime Minister Theresa May announced the delay of a key Brexit vote in the country's parliament. Originally, it was scheduled to be held Tuesday. Sterling slipped to one-and-a-half year low of $1.266 on the news.

Worries over the ongoing U.S.-China trade relation also weighed on sentiment. On Sunday, China summoned the U.S. ambassador to Beijing to protest Huawei CFO Meng Wanzhou's detention.

European markets fell 0.8%-1.8%

AT HOME

Benchmark indices nosedived 2%, suffering worst fall in 2-months and closing at the lowest level in a month. Sensex lost 713 points to settle at 34959 while Nifty finished at 10488, down 205 points. BSE mid-cap and small-cap indices fell 1.8% each. All the BSE sectoral indices ended in red with Realty and Telecom indices leading the losses, down 3.2% and 2.7% respectively.

FIIs net bought stocks worth Rs 116 cr but net sold index futures and stock futures worth Rs 1012 cr and 852 cr respectively. DIIs were net sellers to the tune of Rs 146 cr.

Rupee depreciated 54 paise to end at 71.34/$, the lowest close since November 20.

The Reserve Bank of India's governor, Urjit Patel, resigned with immediate effect, raising concerns over the independence of the central bank. Following the announcement, the rupee fell sharply against the dollar and is currently trading around 72.50 in NDF market as against yesterday's close of 71.34/$.

OUTLOOK

Today morning, Nikkei is down 0.4%, Hang Seng is flat while Shanghai is up 0.2%. SGX Nifty is about 150 points lower start for our market.

At the risk of repeating, we had turned our view negative since 10750 support was broken and have been advising holding on to short positions with a trailing stop-loss.

In yesterday's report we had given downside targets of 10535 followed by 10470 below 10588.

Nifty plunged all the way to 10475 before closing at 10488, nearly achieving the 10470 target above and vindicating our view.

The benchmark is slated to open around 10350 today. 10360 and 10310 are the 61.8% and 67% retracement levels of the entire 10004-10941 upmove, making 10360-10310 an important support zone. If 10310 gives way, 10004, the bottom made in late October, would be the next crucial support.

10600-10560, the gap created by yesterday's gap down opening, would now be the immediate hurdle, with the stop-loss of which, trading shorts should be held on to.

The counting of votes for five assemble elections - Rajasthan, Madhya Pradesh, Chhattisgarh, Telangana and Mizoram, will take place today. Exit polls had predicted Win for Congress in Rajasthan and tough fight in Chhattisgarh and Madhya Pradesh.

Winter session of the Parliament starts today.

10535 BELOW 10588; 10722-10747 CONTINUES TO BE RESISTANCE ZONE

10535 BELOW 10588; 10722-10747 CONTINUES TO BE RESISTANCE ZONE

WORLD MARKETS

US indices nosedived 2.2%-3% on Friday on the back of a weaker-than-expected jobs report and China-U.S. trade tensions.

The U.S. economy added 155,000 jobs last month, lower than the expected gain of 198,000 jobs. Wage growth also missed estimates.

Wall Street Journal reported federal prosecutors are expected to bring charges against Chinese hackers allegedly trying to break into technology service providers in the U.S.

US crude rose 2.2% to $52.61 and Brent rose 2.7% to $61.67 a barrel after OPEC, Russia and several other producers reached an agreement to cut output by 1.2 million bpd during the first six months of 2019.

European markets, except 0.2% lower DAX, gained 0.5%-1.1%.

For the week, US indices nosedived 4.5%-4.9%. European markets tumbled 2.9%-4.2%. In Asia, Nikkei and Hang Seng fell 3% and 1.7% respectively, while Shanghai rose 0.7%.

AT HOME

Sensex and Nifty soared 1% and 0.9% respectively, breaking three-day losing streak. Sensex settled at 35673, up 361 points while Nifty added 92 points to finish at 10693. Broader market however underperformed with 0.2% higher mid-cap index and 0.3% lower small-cap index. BSE Bankex and Finance indices climbed 1.7% and 1.1% respectively, becoming top gainers among the sectoral indices while Utilities and Oil & Gas indices were the top losers, down 1% and 0.6% respectively.

FIIs net sold stocks worth Rs 817 cr but net bought index futures and stock futures worth Rs 617 cr and 855 cr respectively. DIIs were net buyers to the tune of Rs 243 cr.

Rupee appreciated 10 paise to end at 70.80/$.

For the week, Sensex and Nifty fell 1.4% and 1.6% respectively.

Exit polls released on Friday predicted clear wins for the Congress in Rajasthan and TRS in Telangana and a hung assembly in Mizoram, but presented a confused picture/close contest in Madhya Pradesh and Chhattisgarh.

OUTLOOK

China's November exports rose 5.4% y-o-y, the weakest performance since March and below the 10% jump predicted by a Reuters poll. Import growth was 3%, the slowest since October 2016, and a fraction of the 14.5% expected.

U.S. Trade Representative Robert Lighthizer told in an interview on Sunday that the end of the 90-day pause in tariff escalation between Washington and Beijing in their trade war is a "hard deadline."

Today morning, Nikkei and Hang Seng are down 1.8% and 1% respectively while Shanghai is off 0.3%. SGX Nifty is suggesting about 110 points lower start for our market.

Readers would recall that we had turned our view negative after Nifty broke the immediate support of 10750, where 200-DMA was also placed. Nifty, after touching a low of 10588, which roughly coincided with the 38.2% retracement level of the entire 10004-10941 upmove, rebounded on Friday to end at 10693 but is set to open around the bottom made last week. We had also said on Friday, that, 10747-10722, the gap created by Thursday's gap down opening, would now act as the immediate hurdle, with the stop-loss of which, trading shorts can be held on to.

Below 10588, which is the bottom made last week, next important support to eye would be 34-DMA, which is placed around 10535. Below 10535, 10470, the 50% retracement level of the entire 10004-10941 upmove, would be the next support to eye.

10747-10722 continues to be immediate resistance zone, with the stop-loss of which, trading shorts should be held on to.

US EQUITIES STAGE MAMMOTH COMEBACK; EXIT POLLS IN FOCUS AT HOME

US EQUITIES STAGE MAMMOTH COMEBACK; EXIT POLLS IN FOCUS AT HOME

WORLD MARKETS

After falling nearly 3%, US indices made a spectacular comeback after news broke that the Federal Reserve could tighten monetary policy at a slower pace than previously expected, to end mixed with modest changes. Dow and S & P 500 ended lower by 0.3% and 0.2% respectively while Nasdaq rose 0.4%.

The Wall Street Journal reported that the U.S. central bank is considering whether to signal a wait-and-see approach to rate hikes at its upcoming meeting this month. The report said Fed officials do not know what their next move on rates will be after December.

The initial fall was attributed to news of the arrest of Huawei CFO Meng Wanzhou in Canada reportedly over the possible violation of sanctions against Iran. She faces extradition to the U.S. The arrest decreases the likelihood that a permanent U.S.-China trade deal will be reached.

US crude tumbled 2.7% to $51.49 a barrel and Brent fell 2.9% to $59.79 as OPEC reportedly agreed to cut production, but delayed making a decision on how deeply it would cut production until after it meets with Russia on Friday.  

The U.S. economy added 179,000 private jobs in November, below an estimate of 195,000, according to a report from ADP and Moody's Analytics.

European markets tumbled 3.2%-3.5%

AT HOME

Sensex and Nifty nosedived 1.6% and 1.7% respectively, extending the losing streak to third straight day and suffering the worst fall since 11th October, 2018. Sensex settled at 35312, down 572 points while Nifty tumbled 181 points to finish at 10601. BSE mid-cap and small-cap indices fell 1.5% and 1.4% respectively. All the BSE sectoral indices ended in red with Energy index leading the tally, down 2.4%, followed by 2.3% lower Auto and Realty indices.

FIIs net bought stocks worth Rs 72 cr but net sold index futures and stock futures worth Rs 1722 cr and 1047 cr respectively. DIIs were net sellers to the tune of Rs 390 cr.

Rupee closed at 70.90/$, depreciating 44 paise compared to previous close.

Fitch Ratings cut India's FY19 GDP growth forecast to 7.2% from 7.8%. The rating agency has also cut growth forecasts for FY20 and FY21 to 7% from 7.3% and 7.1% from 7.3%, respectively.

OUTLOOK

Today morning, Asian markets are trading with modest gains and SGX Nifty is suggesting about 50 points higher start for our market.

For past couple of sessions We had been mentioning that the 200-DMA, placed around 10750, is the immediate support and had given downside target of 10675 below that.

Nifty broke 10750 yesterday and plunged all the way to 10588 before closing at 10601 and is set to open around 10650 today.

10588, the low made yesterday, roughly coincides with the 38.2% retracement level of the entire 10004-10941 upmove and hence is the immediate support to eye. Below 10588, 34-DMA, placed around 10530, would be the crucial support to eye.

10747-10722, the gap created by yesterday's gap down opening, would now act as the immediate hurdle, with the stop-loss of which, trading shorts can be held on to.

Rajasthan and Telangana will poll for assembly elections today and exit polls for all the five assembly elections-Rajasthan, Telangana, Madhya Pradesh, Mizoram and Chhattisgarh-will be released after 5.30 pm today. The counting of votes will take place on December 11.

10675 IS THE NEXT SUPPORT; 10850 IMMEDIATE HURDLE

 10675 IS THE NEXT SUPPORT; 10850 IMMEDIATE HURDLE

WORLD MARKETS

U.S. stock market was shut yesterday out of respect for former President George H.W. Bush's funeral.

Main European markets ended with cuts of 1.2%-1.4% as resurgent trade worries worsened fears about global economic growth. Eurozone retain sales were up 0.3% month-on-month and 1.7% year-on-year gain.

Sterling to fall below the $1.27 mark for the first time since the end of October after British Prime Minister Theresa May suffered a series of embarrassing defeats in Parliament on Tuesday.

US oil fell 36 cents to $52.89 a barrel and Brent was down 24 cents at $61.84 ahead of a meeting of the world's biggest oil exporters who will discuss cutting output to help shore up prices and curb excess supply..

AT HOME

Benchmark indices fell 0.7% each, extending the losing streak to second straight day. Sensex lost 250 points to settle at 35884 while Nifty finished at 10785, down 84 points. BSE mid-cap and small-cap indices tumbled 1.2% each. All the BSE sectoral indices ended in red with Metal and Auto indices leading the losses, down 3.8% and 2.4% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 358 cr, 1165 cr and 843 cr respectively. DIIS were net sellers to the tune of Rs 792 cr.

Rupee appreciated 3 paise to end at 70.46/$.

The monetary policy committee (MPC) kept the benchmark repo rate unchanged at 6.50% as expected and also kept its stance unchanged at 'calibrated tightening'. The committee decided to cut the statutory liquidity ratio (SLR) to 18.0% from 19.5%. Starting the January-March quarter, SLR will be cut by 25 basis points each quarter in order to align it with the liquidity coverage ratio. The RBI also cut its inflation projection for second half of FY19 to 2.7-3.2% from 3.9-4.5% earlier and for first half of FY20 to 3.8%-4.2% from 4.8% earlier. FT19 GDP growth target was maintained at 7.4%.

OUTLOOK

Today morning, Asian markets are down 0.7%-2.2% and SGX Nifty is suggesting about 80 points lower start for our market.

For past couple of sessions, we have been mentioning that 20-week moving average, placed around 10960, is the immediate hurdle, a crossover of which is required for a fresh upmove. We had also said that 200-DMA, placed around 10750, is the immediate support.

Nifty, yesterday, after touching a low of 10748, closed at 10782 but is set to open around 10700 today.

As mentioned yesterday, below 10750, next support to eye would be 20-DMA, which is placed around 10675.

10850 is the immediate hurdle on the hourly chart above which 10941, the top made on Monday, would be the next important hurdle to eye.