IIP, CPI DISAPPOINT; NIFTY TAKES OUT 7690 HURDLE
WORLD MARKETS
US indices ended modestly lower, breaking two-day rising streak, on persisting geopolitical worries.
Media reports suggested that Russia has sent a 280 truck convoy to Ukraine carrying humanitarian aid but Kiev has said it would not allow the vehicles to cross into its territory. NATO fears the aid may be a disguised bid to invade Ukraine.
European markets, except Spain, ended lower, with DAX leading the tally with 1.2% fall, after ZEW economic expectations for August slumped to 8.6 points, the lowest level since December 2012.
Nymex crude fell 71 cents to $97.4 a barrel. Brent crude fell to $102.65/bbl, a 13-month low in intraday trading.
AT HOME
After a gap up opening, benchmark indices traded in a narrow range for better part of the day but spiked up in the late noon trade to end with hefty gains of nearly a percent and half. Sensex surged 362 points to settle at 25881 while Nifty finished at 7727, up 101 points. BSE mid-cap and small-cap indices gained 0.5% each. Except a marginal cut in BSE Teck index, all other sectoral indices ended higher with Auto and Oil & Gas indices leading the tally, rising 1.8% and 1.7% respectively.
FIIs net bought stocks, index futures and stock futures worth Rs 371 cr, 1391 cr and 639 cr respectively. DIIs were net sellers to the tune of Rs 40 cr.
Rupee appreciated 9 paise to close at 61.08/$.
India's industrial output, as measured by IIP, rose by lesser than expected 3.4% in June as against 5% growth in May. The figure for May was revised upward to 5% from original 4.7%.
July CPI inflation came in at higher-than-expected 7.96% v/s 7.46% in June. The core CPI however inched lower to 7.42% from 7.45%. Headline figure for June was revised upwards to 7.46% from 7.31%.
BHEL reported worse-than-expected 58.4% dip in June quarter net profit at Rs 193.5 cr. Net sales dropped 20.2% to Rs 5068 cr. Operating margin fell 180 bps to 4.2%.
OUTLOOK
Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 15 points lower opening for our market.
In our latest weekly and subsequent daily reports we had mentioned that the trendline adjoining recent tops on the daily charts presents a resistance around 7690, a crossover of which is required to turn the near term view bullish. Nifty surged 101 points yesterday to close at 7727, fulfilling this condition.
Trading longs can be initiated with the stop loss of 7645, which is the immediate support on the hourly chart. 7840, the all-time high made , is the immediate target.
ONGC and Tata Steel will report their quarterly earnings today.
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