NIFTY READY TO RESUME UPMOVE AFTER 3-DAY CONSOLIDATION; STAY LONG WITH THE STOP LOSS OF 8230

NIFTY READY TO RESUME UPMOVE AFTER 3-DAY CONSOLIDATION; STAY LONG WITH THE STOP LOSS OF 8230

WORLD MARKETS

US indices ended little changed on Friday after data had the U.S. economy producing less-than-expected jobs in October and the unemployment rate declining to a six-year low.

Government's October non-farm payroll report showed addition of 214000 jobs, less than the 231000 anticipated and the jobless rate at 5.8%.

European markets, except a 0.2% higher FTSE, ended with cuts in the vicinity of a percent. Reports of Russian tanks crossing into eastern Ukraine weighed on the sentiment. Pessimism over economic growth and uncertainty surrounding further European monetary stimulus weighed on bank stocks.

After touching a high of 88.19, dollar index eased to 87.64. Nymex crude rose 0.9% to $78.6 a barrel; Gold jumped 2.4% to $1170 an ounce, halting a seven-day losing streak.

For the week, Dow gained 1.1%, S & P 500 rose 0.7% and Nasdaq was up 0.05%. In Europe, Italy and Spain were down more than 3%, France lost 1% and Germany eased 0.4%.

                                                             

AT HOME

It was yet another day of consolidation as benchmark indices, after falling nearly half a percent in the initial trade, recouped all the losses by the end to end little changed on Friday. Nifty ended at 8337, down 1 point while Sensex lost 47 points to settle at 27869. BSE mid-cap index gained 0.4% while the small-cap index lost 0.4%. BSE Realty and Healthcare indices climbed 2.4% and 2.3% respectively, becoming top gainers among the sectoral indices while Metal and Capital Goods indices were the top losers, down 1.3% and 0.7% respectively.

FIIs net bought stocks and index futures worth Rs 2537 cr (which includes stake sell by Bain Capital in Hero Motocorp) and 332 cr respectively but net sold stock futures worth Rs 535 cr. DIIs were net sellers to the tune of Rs 192 cr. 

Rupee depreciated 21 paise to close at 61.61/$.

For the week, Sensex ended absolutely flat while Nifty gained 0.2%.

L & T reported 20.5% growth in standalone net profit at Rs 1042.2 cr in September quarter supported by other income. Revenue grew by 3.3% to Rs 12717 cr. Other income climbed 29.6% to Rs 603 cr. Operating profit rose 13% to Rs 1341 cr and margin expanded by 90 bps to 10.5%. The company reduced its consolidated revenue guidance for FY15 from 15% growth to 10%-15% but on order inflows, it maintained the guidance of 20% growth.

Prime Minister Narendra Modi added 21 more ministers to his government yesterday out of which four new cabinet ministers are Manohar Parrikar, Suresh Prabhu, JP Nadda and Choudhary Birender Singh who have been given defense, railways, health and rural development ministries respectively. Sadanand Gowda has been moved from railways to the law ministry.

OUTLOOK

China's October CPI has come in at 1.6% y-o-y, which is in-line with estimates. Prices stayed flat on a monthly basis, compared to a 0.1% gain forecast and after rising 0.5% in the previous month.

Today morning, except a 0.7% lower Nikkei, other Asian markets are trading with gains ranging from 0.5%-1.5% and SGX Nifty is suggesting about 25 points higher opening for our market.

Ever since Nifty generated a fresh breakout on the daily chart on 30th October, we have been working with the target of 8520. That continues to be the next major level to eye.

Immediate support on the hourly chart is placed at 8230, with the stop loss of which trading longs should be held on to.