NIFTY EXTENDS CONSOLIDATION; 8373-8115 CONTINUES TO BE IMMEDIATE RANGE

NIFTY EXTENDS CONSOLIDATION; 8373-8115 CONTINUES TO BE IMMEDIATE RANGE

WORLD MARKETS                             

US indices ended with cuts of 0.3%-0.6%, pressured by weakness in Asian and European markets and a sharp decline in the utilities sector.

Concerns about Greece's failure to elect a new president on Monday continued to weigh on global markets yesterday, with Asian and European stocks closing down 1%-1.5%.

The December reading of the Conference Board's consumer confidence index came in slightly lower-than-expected at 92.6. Earlier, the Case-Shiller house price index for October showed that U.S. single-family home prices' rate of increase continued to decelerate in October since the stronger-than-expected rise seen in the previous month.

Nymex crude gained 51 cents to settle at $54.12 a barrel, rebounding from a five-and-a-half year low. Brent closed up 12 cents at $58. Gold gained 1.6% to $1200 an ounce.

European markets lost between 0.6%-1.6% as lower oil prices and political uncertainty in Greece weighed on sentiment. Spanish retail sales for November rose 1.9% year-on-year and the country's consumer price index fell more than expected with a year-on-year fall of 1.1% in December. In the U.K., the Nationwide House Price index showed that annual home price growth slowed again in November for a fourth straight month.

AT HOME

After trading with a negative bias for better part of the day, benchmark indices bounced back in last hour of trade to end marginally higher. Sensex gained 8 points to settle at 27404 while Nifty finished at 8248, up 2 points. BSE mid-cap and small-cap indices gained 0.5% and 0.2% respectively. BSE Consumer Durable and Power indices gained the most among the sectoral indices, rising 1.4% and 1.1% respectively while Oil & Gas and Metal indices lost 1.2% and 1.1% respectively.

FIIs net bought stocks and index futures worth Rs 278 cr and 473 cr respectively but net sold stock futures worth Rs 33 cr. DIIs were net buyers to the tune of Rs 161 cr.

Rupee appreciated 28 paise to end at 63.38/$.

News reports citing a senior financial ministry official said that the government has decided to roll back the 4-6% excise duty cuts on automobiles announced last February. Consumer durable items like fridges and TV sets would also become costlier as the 2% excise duty here too will be rolled back.

OUTLOOK

China's HSBC final PMI for December has come in at 49.6, which is up slightly from preliminary reading of 49.5, but down from 50 in November.

Asian markets are trading with modest gains and SGX Nifty is suggesting about 10 points higher opening for our market.

After a steep 8627-7961 fall and an equally steep 7961-8365 rebound, Nifty has been in a consolidation mode for last four sessions. As we have been mentioning 8373, the 61.8% retracement level of the entire 8627-7961 fall, is the important hurlde to eye, a crossover of which would also confirm a higher-top higher-bottom formation on the daily chart and would pave the way for the retest of the 8627 top.

On the way down, 8150-8115 continues to be the support area, where 8150 is the bottom made last week while 8115 is the 61.8% retracement level of the recent 7961-8365 pullback. A breach of this support zone can take the benchmark back to the 7961 bottom.