7900-8060 IS THE IMMEDIATE RANGE

7900-8060 IS THE IMMEDIATE RANGE

WORLD MARKETS

US indices gained about a fifth of a percent, with the Dow ending at a record and the S&P 500 back above 2,000, after the Federal Reserve said it was nearing the end of its asset purchases and reiterated it would not hike interest rates for a 'considerable' period.

In its statement released after its two-day meeting, the Fed left largely intact key provisions and cut its bond buying down to $15 billion a month, while indicating the asset purchases would end altogether in October.

In a news conference held after the announcement of policy decision, Fed Chair Janet Yellen reiterated there continued to be "significant under-utilization" in the labor force, with inflation running below the Fed's objectives.

US Consumer Price Index declined 0.2% last month, while prices excluding food and energy costs held unchanged. A measure of confidence among home builders rose to its highest level since 2005.

European markets, except a 0.2% cut in FTSE, gained between 0.3%-1.6% with Italy and Spain leading the tally. FTSE was hit by uncertainty ahead of the closely fought Scottish independence referendum. European bank stocks gained ahead of the launch of the European Central Bank's first Targeted Long-Term Refinancing Operations (TLTROs). The cheap loan scheme will start on Thursday and is expected to provide banks with up to 400 billion euros ($518 billion) of funds.

Nymex crude fell 46 cents to $94.4 a barrel; Gold dropped 80 cents to $1236 an ounce.

                                                             

AT HOME

Benchmark indices ended with gains of about half a percent after a rangebound but choppy trading session, recouping some of the losses suffered in past two sessions. Sensex gained 139 points to settle at 26631 while Nifty finished at 7975, up 42 points. BSE mid-cap and small-cap indices gained 0.2% and 0.3% respectively. Except a 1.1% cut in BSE Consumer Durable index and a 0.04% cut in the Bankex, all other sectoral indices ended higher, with IT and Power indices leading the tally, putting on 1.5% and 1.4% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 136 cr. 52 cr and 104 cr respectively. DIIs were net sellers to the tune of Rs 161 cr.

Rupee appreciated 13 paise to close at 60.92/$.

OUTLOOK

Today morning Asian markets are trading mixed and SGX Nifty is suggesting about 30 points lower opening for our market. Nikkei is up a percent as the yen has weakened to a fresh six-year low against the dollar and exports fell by a smaller-than-expected 1.3% in August.

After achieving our indicated downside target of 7935 on Tuesday, Nifty rebounded yesterday to close at 7975. 7935-7900 continues to be important support area where 7935 is the 38.2% retracement level of the recent 7540-8180 upmove and 7900 is where 34-DMA is placed.

On the way up, 8050-8060, the erstwhile support, will now act as the resistance. This makes 7900-8060 a no trading zone, a breach of which, on either side, is required to take a fresh view on Nifty.

Key event to watch out in the Europe would be independence vote in Scotland. The result will be announced tomorrow.