BULLS BACK ON THE JOB AFTER A BREAK; TRAIL STOP LOSS TO 8100
WORLD MARKETS
Dow and S & P 500 ended with modest cuts yesterday, with energy stocks leading losses on oil's drop to a multi-month low. Nasdaq gained 0.2%.
Nymex crude fell 63 cents to $92.7 a barrel, marking a near 2014 low and Brent crude fell below $100 for the first time in more than a year. Gold dropped 1% to $1254 an ounce.
European markets, except a 0.1% higher DAX, ended with cuts of upto half a percent after weak trade data from China. DAX was boosted by upbeat German trade data for July, which showed a 4.7% surge for exports—the biggest rise since May 2012. European Union formally adopted a package of new sanctions against Russia on late Monday, but said their entry into force would be delayed to leave time to assess whether a cease-fire in Ukraine is holding.
China's August trade report showed imports fell by an annualized 2.4% as against the forecast of a 1.7% rise.
US President Obama is scheduled to meet congressional leaders today to lay out his plan to combat Sunni extremists of Islamic State which will be followed by address to the nation on Wednesday.
AT HOME
After a break of two days, bulls were back on the job as benchmark indices soared more than a percent to close at fresh all-time high. Sensex surged 293 points to settle at 27320 while Nifty finished at 8174, up 87 points. BSE mid-cap and small-cap indices gained 1.3% and 2.1% respectively. Except a 0.2% cut in BSE Consumer Durable index, all other sectoral indices closed higher, with Oil & Gas index and Bankex leading the tally, putting on 1.8% and 1.4% respectively.
FIIs net bought stocks and index futures worth Rs 1163 cr and 193 cr respectively but net sold stock futures worth Rs 80 cr. DIIs were net sellers to the tune of Rs 508 cr.
Rupee appreciated 10 paise to close at 60.29/$.
The government yesterday filed an affidavit in the Supreme Court on 218 coal blocks declared as illegal wherein it proposed that the Supreme Court should consider the retention of 46 coal blocks, 40 of which are already producing coal while six are ready for production.
OUTLOOK
Today morning Asian markets are trading with modest gains and SGX Nifty is suggesting a flattish start for our market.
In our weekly report we had mentioned that the RSI on the daily chart continues to make higher-tops and bottoms along with Nifty and that suggests that Nifty has still not topped out. In yesterday's report we had mentioned that upon crossover of the 8142, 8250 would be the next target to eye and had advised staying long with the stop loss of 8010. Nifty yesterday surged 87 points to close at 8174, marking a fresh all-time high and vindicating our positive bias.
Stay long with a trailing stop loss continues to be the advise. Immediate support on the hourly chart has moved up to 8100 which should now serve as the stop loss for trading longs. 8250 continues to be immediate target.
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