IIP SURPRISES ON THE WAY UP; CPI EASES FOR THE SECOND MONTH
WORLD MARKETS
US indices lost
upto 0.4% yesterday, halting a seven-day win streak for the S&P 500 Index,
as markets worried about developments related to Syria and Federal Reserve
policy moves.
U.S. Secretary of
State John Kerry arrived in Geneva on Thursday for discussions with Russia’s
foreign minister on a proposed plan under which Syria will turn over its
chemical weapons to the international community.
Separately, Syria’s
President Bashar al-Assad said the U.S. needs to give up “its policy of
threats” and stop shipping arms to Syrian rebels before his government
surrenders its chemical weapons
First-time claims
for unemployment benefits declined by 31,000 to 292,000 in the week ending
Sept. 7, marking the lowest level since April 2006, but processing glitches
involving two states clouded the reading, the Labor Department reported.
European markets
ended flat to modestly lower as the region’s industrial output contracted more
than forecast. Factory production in the region fell 1.5% from June, more than
the 0.3% contraction forecast by economists.
Gold slid $33.20,
or 2.4%, to $1,330.60 an ounce, while crude-oil added $1.04 to end at $108.60 a
barrel
AT HOME
Profit booking set
in after a heady run-up as benchmark indices, after a flattish start, saw a
sustained downward move through the trading session to end lower by 1%. Sensex
slipped 215 points to settle at 19781 while Nifty shut shop at 5850, down 62
points. BSE mid-cap index ended flat while the small-cap index gained 0.2%. Except
0.5% and 0.3% rise in BSE Realty and FMCG indices respectively, all other
sectoral indices ended in red, with Metal index and Bankex leading the tally,
giving away 2.5% and 1.9% respectively.
Rupee too retreated
after five consecutive strong days to close at 63.50, the previous close being
63.38.
FIIs net bought stocks
worth Rs. 931 cr but net sold index futures and stock futures worth Rs. 344 cr
and 310 cr respectively. DIIs were net sellers to the tune of Rs. 395 cr.
OUTLOOK
Today morning,
Asian markets are trading flat to modestly lower while SGX Nifty is suggesting
a flattish start for our market.
India's industrial
output, after contracting for two consecutive months, grew at a four-month high
of 2.6% in July against contraction of 0.1% in same month last year.
Manufacturing, which constitutes over 75% of the index, grew at 3% this month
compared to stagnation in July last year. The big surprise came from capital
goods sector which rebounded by a robust 15.6% against a decline of 5.8% last
July. Electricity grew at 5.2% v/s 2.8%.
CPI eased
marginally in Aug to 9.52% in line with expectations from 9.64% in July, Food
prices for consumers eased to 11.06% in Aug vs 11.24% in July.
6000, the level
emnating from the downward sloping trendline adjoining 6230 and 6093, the tops
made in May and July respectively, continues to be the immediate hurdle to
watch on the way up. In yesterday's report we had mentioned that 5832, the low
made Wednesday, is the immediate support. The benchmark, after touching a low
of 5815, recovered to close at 5850. Next line of support below 5815 would come
in the 5738-5688 region, which is the gap created by the gap up opening on
Tuesday.
Economic data to
watch today include retail sales, producer prices and consumer sentiment from
the US.
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