BRENT CRUDE HITS 4-YEAR LOW; NIFTY ON TRACK TO ACHIEVE 8520 TARGET

BRENT CRUDE HITS 4-YEAR LOW; NIFTY ON TRACK TO ACHIEVE 8520 TARGET

WORLD MARKETS

While Dow ended marginally higher, S & P 500 and Nasdaq lost about three tenth of a percent amid concerns over falling oil prices and world economic growth. Mood was also cautious on account of midterm elections.

In congressional elections being held across the nation, Republicans were expected to increase their numbers in the House and Senate, although whether the GOP garners enough seats to take control of the latter body was viewed as too close to call.

Brent crude fell to a multi-year low after Saudi Arabia lowered the price of oil exported to the United States, while increasing the cost to Asia and Europe.

US factory orders fell 0.6% in September v/s expectations of a 0.5% dip. Trade gap expanded in September to $43 bn as exports slowed from a record, illustrating the impact of softer global growth on the U.S. economy.

The European Commission reduced its estimates for euro-zone growth, projecting the 18-nation region's GDP would climb by 0.8% in 2014 and 1.1% next year, a decline from estimates of 1.2% and 1.7%.

European markets plunged between 0.5%-2.2%.

Nymex crude fell $1.6 to $77.2 a barrel; Gold eased 0.2% to $1168 an ounce. 

AT HOME

After a heady runup of previous four sessions, benchmark indices started new week and month on a quiet note by ending little changed after trading in a narrow range through the session on Monday. Sensex settled at 27860, down 5 points while Nifty finished at 8324, up 2 points. BSE mid-cap and small-cap indices however gained 1.1% and 1.3% respectively. BSE Realty index soared 3.6%, becoming top gainer among the sectoral indices, followed by 0.5% rise in Bankex. Consumer Durable and Auto indices lost 1.5% and 0.9% respectively.

FIIs net bought stocks and index futures worth Rs 1413 cr and 164 cr respectively but net sold stock futures worth Rs 846 cr. DIIs were net sellers to the tune of Rs 1180 cr.

Rupee depreciated 4 paise to close at 61.40/$.

India's HSBC manufacturing PMI rose to 51.6 in October from 51 in September.

OUTLOOK

China's HSBC Services PMI for October has come in at 52.9, down from 53.5 in September.

Asian markets are trading with modest cuts and SGX Nifty is trading at 8385, suggesting about 25 points higher opening compared to Monday's close.

In Friday's report we had mentioned that Nifty had generated a fresh breakout on the daily chart by closing above the trendline resistance placed around 8115, which projects a target of about 8520.

8520 continues to be the next major target to eye. 8180-8160, the erstwhile resistance zone, would now act as the immediate support, with the stop loss of which trading longs should be held on to.