NIFTY RETREATS AFTER NEARLY ACHIEVING BIG TARGET; 8800 IS THE IMMEDIATE SUPPORT

NIFTY RETREATS AFTER NEARLY ACHIEVING BIG TARGET; 8800 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices plunged between 1%-1.4% as energy stocks tumbled along with Nymex crude, which plunged to its lowest since March 2009.

Nymex oil fell nearly 4% or $1.78 to $44.45; Brent eased $1.22 to $48.38 a barrel.

Meanwhile, the Federal Open Market Committee stuck to its vow to be "patient" on hiking interest rates and raised its view of the economy and labor market, even as the central bank anticipates a further decline in inflation.

European markets ended mixed. FTSE and DAX gained 0.2% and 0.8% respectively while Spain, Italy and France lost 1.3%, 0.8% and 0.3% respectively. Greece's Athens Composite index closed more than 9% lower, with its four main banks ending more than 25% lower. This follows the victory of the far-left Syriza party in Greece on Sunday, which has raised fears of a sovereign default that could hit Greek banks hard.

AT HOME

After gaining nearly eight tenth of a percent in the morning trade, benchmark indices plunged in the noon trade to finally ended almost flat. Sensex settled at 29559, down 12 points while Nifty finished at 8914, up 4 points. BSE mid-cap index gained 0.3% while the small-cap index lost 0.5%. BSE Consumer Durable index soared 4.6%, becoming top gainer among the sectoral indices, followed by 1.7% rise in Realty index. Capital Goods and Metal indices lost 1.4% each, becoming top losers.

FIIs net bought stocks worth Rs 1723 cr but net sold index futures and stock futures worth Rs 1301 cr and 488 cr respectively. DIIs were net sellers to the tune of Rs 1293 cr.

Rupee depreciated 1 paise to end at 61.41/$.

Government yesterday decided not to appeal in the transfer pricing case it lost to Vodafone in the Bombay High Court.

Government also announced divestment of upto 10% of its equity in Coal India through OFS route on January 30. The floor price will be declared today.

In another decision, the Cabinet has decided on a reserve price of Rs 3705 crore per Mhz for the 2100 Mhz band for the upcoming spectrum auctions, which is 36% higher than suggested by the Telecom Regulatory Authority of India (TRAI).

OUTLOOK

Today morning Asian markets are trading with cuts in the vicinity of half a percent and SGX Nifty is suggesting about 25 points lower opening for our market.

Nifty touched a high of 8985 yesterday, nearly achieving the 9000 target we had been working with since the benchmark broke out on daily chart on 15th January when 8446 was crossed.

Apart from the pattern target, 9000 was also in the vicinity of which a rising trendline adjoining recent tops on the weekly chart was placed. This makes 9000 an immediate hurdle, a crossover of which is required for the further upmove. Therefore we advise booking profit in trading longs to reenter on dips.

Immediate support on the hourly chart has moved up to 8800 a breach of which would generate a sell on the hourly chart and would pave the way for the further correction.

HDFC, Dr Reddy, IDFC, SSLT and Asian Paints will report their quarterly earnings today.