ALL EYES ON “MODI BUDGET”

ALL EYES ON “MODI BUDGET”

WORLD MARKETS                             

US indices ended with cuts of 0.3%-0.5% amid lackluster data and oil gains.

A second reading of U.S. fourth-quarter GDP showed growth expanded at a 2.2% annualized pace, revised down from the 2.6% pace estimated last month. The Chicago Purchasing Managers Index came in at 45.8, the lowest since July 2009. Consumer sentiment came in at 95.4 for February, beating expectations but down from January's 98.1. Pending home sales were the highest in 18 months.

Nymex crude rose 3.3% to $49.76 a barrel, for the first monthly gain since June.

European markets, except a marginally lower FTSE, gained between 0.4%-0.8% ahead of the launch of the European Central Bank's quantitative easing program.

The ECB is set to launch its 60 billion euro a month money-printing program in March, with details of the scheme to be discussed at it planned meeting next week.

German lawmakers approved a four-month extension of Greece's bailout.

For the week, Dow ended marginally lower, S & P 500 lost 0.2% while Nasdaq gained 0.2%. European markets surged 2.3%-3.6% except a modest 0.5% rise in FTSE.

AT HOME

It turned out to be a fantastic Friday as Sensex and Nifty soared 1.6% and 1.8% respectively, registering the largest single day in more than a month. Sensex settled at 29220, up 473 points while Nifty climbed 161 points to finish at 8845. BSE mid-cap and small-cap indices gained 1.8% and 1.4% respectively. Except a 0.2% fall in BSE FMCG index, all other sectoral indices ended higher, with Realty and Capital Goods indices leading the tally, climbing 4.2% and 3.8% respectively.

The economic survey presented by the finance ministry yesterday, pegged FY16 GDP growth at 8.1%-8.5% and said there was scope for big bang reforms. It sees growth rate for the current fiscal at 7.4%.

The Survey said the government was committed to fiscal consolidation, and that the outlook for the domestic macroeconomic was optimistic. The Survey said a double digit growth trajectory was now a possibility, also because inflation was showing a declining trend.

In addition, the government should meet its medium term fiscal deficit target of 3% of GDP, the Survey said.

FIIs net bought stocks and stock futures worth Rs 1957 cr and 1128 cr respectively but net sold stock futures worth Rs 107 cr. DIIs were net sellers to the tune of Rs 492 cr.

Rupee depreciated 8 paise to end at 61.83/$.

OUTLOOK

All eyes today would be on Parliament today where Modi government is set to present its first full scale budget.

The government is likely to commit itself to fiscal deficit figure of 4.1% for FY15 and 3.6% for FY16. Gross market borrowing for FY16 is likely to be set at 6.23 lakh cr. Nominal GDP growth target for FY16 is seen at 13%. Another important figure to watch would be plan expenditure, which is expected to be around 6 lakh cr.

Market would also watch out for on GST rollout roadmap. Other announcement might include deferral of GAAR by 2-3 years, reduction or removal of MAT for infra sector, incentives for low cost housing and renewable energy, recapitalization of Public sector banks, relaxation in gold import duty and enhancement of deduction limit under section 80c. Markets are also expecting possibility of STT reduction.

Meanwhile SGX Nifty is suggesting about 70 point higher opening for our market.

After Nifty achieved our downside target of 34-DMA at 8670, we had advised profit booking in short positions. We had also mentioned that 8790 is the immediate hurdle on the hourly chart above which 8900, where the trendline adjoining recent tops on daily chart is placed, would be the crucial hurdle to eye, a breach of which would mark a breakout from a triangle formation and would project a big target of about 9400.

Nifty yesterday surged 161 points to end at 8845 and is set to open with an upward gap today which would easily take it to 8900 mark, achieving the target mentioned above and vindicating our view.

8900, as mentioned above, would be seen as a crucial hurdle and a close above that would eventually lead the benchmark to around 9400.

Meanwhile traders can hold on to trading longs with a stop loss of 8775.

NIFTY ACHIEVES DOWNSIDE TARGET OF 34-DMA

NIFTY ACHIEVES DOWNSIDE TARGET OF 34-DMA

WORLD MARKETS

Dow and S & P 500 ended about 0.1% lower as concerns about oil prices and a worse-than-expected initial jobless claims figure weighed on sentiment. Nasdaq however gained 0.4% on the back of strength in technology stocks.

Nymex oil plunged 5.53% to $48.17 a barrel amid ample global supply and increasing U.S. commercial inventories. Brent fell $1.60 to $60 a barrel.

Initial claims for unemployment for the week of Feb. 15, as against the expected figure of 285000, came in at 313,000. The core CPI, the key figure for the Fed that excludes more volatile food and energy prices, gained 0.2% in January. However, the broader index was down more than expected at 0.7%. Durable goods orders figures for January increased a more-than-expected 2.8%, after a 3.4% decline in the prior month.

European markets gained between 0.6%-1.1%. The latest GDP data from Spain confirmed that the country grew 2% year-on-year in the last quarter. In the U.K., y-o-y GDP was confirmed at 2.7% and the German unemployment rate also stayed at a record low in February.

                                                             

AT HOME

After a flattish start, benchmark indices saw a sustained downward move through the session to end lower by nearly a percent on the expiry day of the February derivative series. Sensex tumbled 261 points to settle at 28747 while Nifty finished at 8684, down 83 points. BSE mid-cap and small-cap indices lost 0.8% each. Except a 0.3% and 0.04% rise in BSE Realty and Oil & Gas indices respectively, all other sectoral indices ended in red with IT and Auto indices leading the tally, giving away 1.4% each.

Railway minister Suresh Prabhu kept passenger fares unchanged and raised rates for carriage of some categories of freight in the 2015-16 railway budget that outlined plans for investment of Rs.8.5 trillion of investment in the network over the next five years. He raised the rail plan size for the next fiscal year by 52% to Rs.1.11 trillion. Prabhu set the target for the network to achieve an operating ratio of 88.5% in the fiscal year starting on 1 April compared with 91.8% in the current year. The budget raised the freight rates for urea by 10%, iron and steel by 0.8%, kerosene and cooking gas by 0.8%, coal by 6.3% and cement by 2.7%.

FIIs net bought stocks worth Rs 2312 cr but net sold index futures and stock futures worth Rs 871 cr and 803 cr respectively. DIIs were net buyers to the tune of Rs 341 cr.

Rupee appreciated 22 paise to end at 61.75/$.

The ratings agency S&P raised its India GDP growth forecast to 7.9% from 6.2% for the year ending March 2016 to reflect a recent change in how gross domestic product is calculated by the government, and said the economy should be a "bright spot" in Asia. The agency also raised its growth forecast for 2016/17 to 8.2% from 6.6% previously. At the same time, the ratings agency lowered growth forecasts for a slew of Asian countries, including China and Japan.

OUTLOOK

Today morning Asian markets are trading flat to modestly higher and SGX Nifty is suggesting about 30 points higher opening for our market.

Ever since Nifty broke immediate support of 8800 on Monday, we had been working with a downside target of about 8650 where 34-dma was placed. 34-DMA had since then moved up and was placed at 8670 yesterday. The benchmark touched a low of 8669 yesterday, achieving the downside target of 34-DMA and vindicating our view.

Traders would do well to book profit in short positions and wait for the breach of this important support before taking fresh shorts.

Immediate resistance on the hourly chart is placed around 8790 above which 8900, where the trendline adjoining recent tops is placed, would be the crucial hurdle to eye. A breach of 8900 would mark a breakout from a triangle formation and would project a big target of about 9400.

The Finance Ministry will release the Economic Survey today. The key figure to watch out would be the fiscal deficit target for FY16 and FY17. Currently markets are working with a target of 3.6% for FY16.

NIFTY CONTINUES TO CONSOLIDATE; RAILWAY BUDGET IN FOCUS TODAY

NIFTY CONTINUES TO CONSOLIDATE; RAILWAY BUDGET IN FOCUS TODAY

WORLD MARKETS                             

US indices ended mixed with Dow gaining 0.1% while S & P 500 and Nasdaq ended marginally lower amid firming oil prices, moderate housing data and some debate over Fed Chair Janet Yellen's congressional testimony.

Fed chair reiterated her remarks on yesterday in front of the House Financial Services Committee.

New U.S. single-family home sales in January fell a less-than-expected 0.2% to 481,000 and supply rose to its highest level since 2010, hopeful signs for the sluggish housing market. Mortgage applications to purchase a home rose 5 percent on a seasonally adjusted basis for the week ending Feb. 20 from the previous week.

The U.S. Energy Information Administration reported that weekly crude inventories rose 8.4 million barrels, more than expected.

Nymex crude rose $1.71 or 3.47% to $50.99 a barrel and brent climbed $3 or 5% to $61.63 a barrel after Saudi Arabia's oil minister said oil demand was growing and data showed Chinese factories were producing more than expected.

European markets too ended mixed with marginal changes.

AT HOME

After rising nearly a percent in the initial trade, benchmark indices gave away most of the gains in the late noon sell-off to end almost flat. Sensex settled at 29008, up 3 points while Nifty finished at 8767, up 5 points. BSE mid-cap and small-cap indices lost 0.2% and 0.4% respectively. BSE Healthcare index and Bankex were the top losers among the sectoral indices, giving away 1% and 0.7% respectively while Teck and IT indices gained 0.5% and 0.4% respectively.

FIIs net bought stocks and stock futures worth Rs 516 cr and 386 cr respectively but net sold index futures worth Rs 931 cr. DIIs were net buyers to the tune of Rs 20 cr.

Rupee appreciated 23 paise to end at 3-week high of 61.96/$.

OUTLOOK

Today morning Asian markets, except a half a percent higher Nikkei, are trading with modest cuts. SGX Nifty is suggesting a marginally higher start for our market.

In yesterday's report we had mentioned that immediate resistance on the hourly chart is placed at 8830, which should serve as the stop loss for trading shorts. Nifty touched a high of 8840 in the initial trade but could not sustain there and slipped to end at 8767.

We had also mentioned that Nifty is currently in a consolidation mode and that upper and lower boundaries of this consolidation are placed around 8900 and 8650 respectively and had advised that traders should stay light till this range breaks. That continues to be the advice.

Railway minister Suresh Prabhu will present Railway budget for the FY15-16 in the Parliament today. The budget is expected to be tight on populist measures and focus on generating extra revenue through innovative measures. To allow money to flow through FDI and PPP, the minister may announce relaxation of certain norms and setting up of a single window clearance system. Passengers may expect more measures for better amenities and improved safety on board.

STAY LIGHT TILL 8650-8900 RANGE IS BROKEN

STAY LIGHT TILL 8650-8900 RANGE IS BROKEN

WORLD MARKETS

US indices gained between 0.1%-0.5% yesterday, with the Dow and S & P 500 touching record intraday high as Fed Chair Janet Yellen's congressional testimony indicated that a rate hike would likely come later rather than sooner.

Yellen's prepared remarks said no rate hike is expected for the next few FOMC meetings. She later said in a question-and-answer session that the Fed would not raise rates before it found confidence in the economic recovery, overcoming current concerns about the labor market, below-objective inflation and the decline in energy prices.

On the data front, the S&P/Case-Shiller composite index of home prices in 20 cities increased by 4.5 percent in December from the same period last year. Markit's services PMI rose to 57 in February from 54.2 in January, indicating that the U.S. services sector expanded in February at its fastest pace since October. U.S. consumer confidence fell more than expected in February, pulling back from a multi-year high according to a private sector report.

Nymex oill fell 17 cents to $49.28 a barrel.

European markets gained between 0.5%-0.8% after the group of euro country finance ministers announced that it had approved Greece's reform plans, thereby giving the go-ahead for the four-month extension of the bailout program. FTSE closed at record high.

                                                             

AT HOME

Benchmark indices ended marginally higher after a choppy trading session, breaking two-day losing streak. Sensex settled at 28975, up 30 points while Nifty gained 7 points to end at 8762. BSE mid-cap and small-cap indices however lost 0.2% and 0.8% respectively. BSE FMCG and Capital Goods indices gained 1.4% and 1.1% respectively, becoming top gainers among the sectoral indices while Oil & Gas and Metal indices were the top losers, giving away 1.2% and 1.1% respectively.

FIIs net bought stocks and stock futures worth Rs 697 cr and 447 cr respectively but net sold index futures worth Rs 252 cr. DIIs were net sellers to the tune of Rs 147 cr.

Rupee appreciated 13 paise to end at 62.195/$.

Laying the ground work for fresh fiscal relations between the Centre and the states, the 14th Finance Commission report was tabled by finance minister in Lok Sabha yesterday, recommended devolution of 42 percent of central taxes to states.

The contentious Bill on land acquisition was introduced in the Lok Sabha yesterday amid a walkout by the entire Opposition. Another Bill on mining ​was also introduced and faced strong protests by the Opposition, especially the Biju Janata Dal (BJD), which said its provisions “infringed upon the Constitutional rights of the States.”

OUTLOOK

China's HSBC flash manufacturing PMI for February has come in at a four-month high of 50.1 as against 49.7 in January.

Asian markets are trading flat to modestly higher and SGX Nifty is suggesting about 20 points higher opening for our market.

Broadly, Nifty continues to be in a consolidation mode after big up move in January, followed by a steep fall in early February. On the way down, 34-DMA, placed around 8650, is the immediate support, where the trendline adjoining recent bottoms on the daily chart is also placed.

On the way up, 8900, where the trendline adjoining recent tops on the daily chart is placed, is the resistance, a breach of which would mark the breakout from this consolidation.

Traders are advised to keep trading volumes low till this 8650-8900 range is broken on either side.

Trading short should carry a strict stop loss of 8830, which is the immediate resistance on the hourly chart.

NIFTY BREAKS IMMEDIATE SUPPORT

NIFTY BREAKS IMMEDIATE SUPPORT

WORLD MARKETS

US indices ended mixed with Dow closing a tad lower and S & P 500 ending flat while Nasdaq gained 0.1% on the back of weakness in oil prices and ahead of Fed Chair Janet Yellen's testimony.

Federal Reserve Chair Janet Yellen testifies before both houses of Congress on Tuesday and Wednesday.

Nymex oil fell $1.36 to $49.45 a barrel.  Brent fell $1.32 to $58.90.

Existing home sales dropped 4.9 percent in January, their lowest level in nine months

European markets, except a marginally lower FTSE, gained between 0.6%-1% as investors cheered a deal to extend Greece's bailout program by four months.

To secure the financial lifeline, however, Greece must present a list of reform proposals - expended Monday or Tuesday.

                                                             

AT HOME

After trading in a narrow range for better part of the day, benchmark indices saw a sharp sell-off in late noon trade to end lower by nine tenth of a percent, extending the losing streak to second day. Sensex fell 256 points to settle at 28975 while Nifty finished at 8754, down 79 points. BSE mid-cap and small-cap indices lost 0.8% and 0.3% respectively. All the BSE sectoral indices ended in red with Consumer Durable and Oil & Gas indices leading the tally, giving away 2% and 1.9% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 602 cr, 122 cr and 530 cr respectively. DIIs were net sellers to the tune of Rs 164 cr.

Rupee depreciated 10 paise to end at 62.32/$.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting a marginally higher start for our market.

Nifty yesterday broke the immediate support placed around 8800, thereby generating a sell on the hourly chart. This opens up the possibility of the further fall to around 8640, where the 34-DMA is placed.

On the way up, immediate resistance on the hourly chart is placed around 8850, with the stop loss of which short positions can be held on to.

Government will introduce amendment to land acquisition bill in Lok Sabha today.

BUDGET SESSION BEGINS TODAY; 8800 CONTINUES TO BE IMMEDIATE SUPPORT

BUDGET SESSION BEGINS TODAY; 8800 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices gained between 0.6%-0.9% on Friday with the Dow and S & P 500 closing at record high after Greece and euro zone finance ministers reached deal to extend the Greek bailout by four months.

Greece faced the risk of default and exit from the euro zone if the country did not obtain enough funding or an extension beyond the Feb. 28 deadline.

US flash manufacturing PMI for February came in at 54.3, up from 53.9 in January and the highest reading since November but weaker than the 55.9 average for all of 2014. The data also showed production levels rose at their fastest pace in four months.

Nymex oil fell 82 cents to $50.34 a barrel. Brent eased 42 cents to $59.80.

European markets ended mixed with FTSE and DAX gaining about four tenth of a percent and CAC ending a tad lower. German producer prices showed a further fall in January, leading to increased fears that the region is falling into a deflationary spiral. On the positive side, Eurozone flash composite PMI for February came in at seven month high of 53.5.

AT HOME

Benchmark indices ended lower by about eight tenth of a percent after a choppy trading session, braking the seven-day winning streak. Sensex lost 231 points to settle at 29231 while Nifty finished at 8828, down 67 points. BSE mid-cap and small-cap indices however gained 0.03% and 0.4% respectively. BSE Oil & Gas and IT indices lost 1.8% and 1.2% respectively, becoming top losers among the sectoral indices while Realty and FMCG indices gained 0.9% and 0.8% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 89 cr, 642 cr and 325 cr respectively. DIIs were net buyers to the tune of Rs 205 cr.

Rupee appreciated 12 paise to end at 62.22/$.

DLF and JSPL Idea Cellular and Yes Bank will replace DLF and JSPL in Nifty from 27th March.

OUTLOOK

Today morning, barring a half a percent lower Hang Seng, other Asian markets are trading higher and SGX Nifty is suggesting a marginally higher start for our market.

Readers would recall that we have been advising holding on to trading longs with a trailing stop loss ever since 8700 hurdle was taken out on 12th February. We have been working with a possibility of retest of the 8997 top made on 30th January.

On Friday, Nifty lost 67 points to settle at 8828, breaking the seven-day winning streak. Immediate support on the hourly chart continues to be around 8000, a sustained trading below which would generate a sell on the hourly chart and can drag Nifty to around 8650, where the 34-DMA is placed.

Traders are advised to hold trading longs with the stop loss of 8800.

Budget Session of the Parliament begins today. Economic Survey will be presented on Thursday, followed by the Railway Budget on Friday and the Union Budget on Saturday. Stock market will remain open on Saturday.

NIFTY ON TRACK TO ACHIEVE 8997 TARGET, TRAIL STOP LOSS OT 8800

NIFTY ON TRACK TO ACHIEVE 8997 TARGET, TRAIL STOP LOSS OT 8800

WORLD MARKETS                             

Dow and S & P 500 fell 0.2% and 0.1% respectively as lower oil prices and Germany’s rejection of a Greece loan extension plan weighed on the sentiment. Nasdaq however gained 0.4% as Apple stayed near records.

Germany rejected the new anti-austerity Greek government's application for a six-month extension of its loan and a renegotiation of some its terms. The proposal will now be discussed at a Euro group meeting scheduled later on Friday.

Nymex crude fell 98 cents to $51.16 barrel after an American Petroleum Institute report showed that U.S. crude stocks rose by 14.3 million barrels last week. Brent fell 32 cents to $60.21.

Weekly jobless claims came in less than expected at 283,000. The latest Philly Fed index showed the lowest reading since February last year.

European markets, except a modestly lower FTSE, gained between 0.4%-1%.

AT HOME

After falling more than a percent from the high made in the initial trade, benchmark indices recouped all the losses in last hour or so to finally end higher by nearly four tenth of a percent, extending the rising streak to seventh straight day. Sensex settled at 29462, up 142 points while Nifty gained 26 points to finish at 8895. BSE mid-cap and small-cap indices however ended just marginally in the green. BSE Metal index soared 3.8%, becoming top gainer among the sectoral indices, followed by 1.4% rise in the Capital Goods index. FMCG index and Bankex were the top losers, giving away 0.9% and 0.6% respectively.

Jindal Steel skyrocketed 28.6% after the company won Gare Palma IV/2 &3 coal blocks at Rs 108 per tonnes in the ongoing auction.

FIIs net bought stocks and stock futures worth Rs 1543 cr and 47 cr respectively but net sold index futures worth Rs 503 cr. DIIs were net sellers to the tune of Rs 196 cr.

OUTLOOK

Markets in China, Hong Kong, South Korea, Singapore, Taiwan and Malaysia are closed. Nikkei is up about half a percent and SGX Nifty is suggesting about 20 points higher opening for our market.

Just to reiterate, ever since Nifty took out 8650-8700 resistance area, we have been advising holding on to trading longs with a trailing stop loss for the target of 8997.

That continues to be the view. Immediate support on the hourly chart has now moved up to 8800, which should serve as the new stop loss.

NIFTY RESUMES NORTHWARD JOURNEY AFTER CONSOLIDATION; TRAIL STOP LOSS TO 8740

NIFTY RESUMES NORTHWARD JOURNEY AFTER CONSOLIDATION; TRAIL STOP LOSS TO 8740

WORLD MARKETS

US indices ended mixed with modest changes despite surprisingly dovish Fed minutes and apparent progress in the Greece-euro zone negotiations as energy stocks fell.

Exxon Mobil was the greatest laggard on the Dow, falling more than 2% on news that Warren Buffett's Berkshire Hathaway shed its $3.47 billion stake in the energy company.

Nymex crude tumbled $1.39 to $52.14 a barrel and weighed on the energy stocks.

US industrial production increased 0.2% in January, slightly below expectations. Housing starts too came in lower than estimated at 1.065 million.

Minutes of the January Fed meeting showed that the central bank will likely delay hiking interest rates to at least the second half of this year

The European Central Bank approved a 68 billion euro two-week extension on emergency liquidity for Greek banks. The assistance comes as Greece tries to negotiate a financing deal with European partners or stick by the terms of its existing international bailout. Greece will submit a request to the euro zone on Thursday to extend its loan program for up to six months.

European markets, except a flat FTSE, gained between 0.6%-1.8%.

                                                             

AT HOME

After Monday's cool-off, benchmark indices resumed their upmove by gaining nearly two third of a percent yesterday to close at the highest level since 29th January. Sensex gained 184 points to settle at 29320 while Nifty finished at 8869, up 60 points. BSE mid-cap and small-cap indices gained 0.8% and 1% respectively. BSE Consumer Durable and Power indices gained the most among the sectoral indices, rising 1.8% and 1.4% respectively while Metal and Realty indices lost 0.7% and 0.4% respectively.

FIIs net bought stocks and index futures worth Rs 2188 cr and 284 cr respectively while net sold stock futures worth Rs 290 cr. The figure in the cash segment included Rs 1860 cr on account of Hero MotoCorp deal. DIIs were net buyers to the tune of Rs 328 cr.

Rupee depreciated 19 paise to end at 62.34/$.

OUTLOOK

Today, markets in China, Hong Kong, South Korea, Taiwan, Singapore, Malaysia and Indonesia are shut for the holiday. Nikkei is up about half a percent and hit a fifteen-year high following better-than-expected export data. SGX Nifty is suggesting a flattish start for our market.

Nifty has resumed its upward move after taking support at 34-DMA which was then placed around 8500. We had given first upside target of 8800, which was the 61.8% retracement level of the recent 8997-8470 fall, above which we have been working with the possibility of retest of the 8997 top and have been advising holding on to trading longs with a trailing stop loss.

That continues to be the view. Immediate support on the hourly chart has moved up to 8740, which should serve as the stop loss for trading longs.

NIFTY CONSOLIDATES AFTER FOUR DAY RUNUP; STAY LONG WITH THE STOP LOSS OF 8700

NIFTY CONSOLIDATES AFTER FOUR DAY RUNUP; STAY LONG WITH THE STOP LOSS OF 8700

WORLD MARKETS

US indices ended modestly higher, with the S & P 500 setting fresh record, on encouraging reports out of Greece.

Reports suggested that Greece intends to ask for an extension of its loan agreement with the euro zone on Wednesday.

European markets ended mixed as fears over Greece's debt problems continued to make investors nervous. On Monday evening, talks between Greek Finance Minister and his euro zone counterparts over managing the country's debt crisis broke down. The main bone of contention seemed to be a proposal for a six-month extension of its international bailout package, which Athens described as "unacceptable."

The German Zew Economic Sentiment Index for February improved to 53.0 from 48.4 in January.

                                                             

AT HOME

After gaining nearly three fourth of a percent in the initial trade, benchmark indices gave away most of the gains through rest of the session to end just marginally higher. Sensex settled at 29122, up 27 points while Nifty gained 4 points to finish at 8809. BSE mid-cap index ended marginally lower while the small-cap index ended a tad higher. BSE FMCG and Realty indices gained the most among the sectoral indices, rising 1.8% and 1% respectively while Oil & Gas and Consumer Durable indices lost 1% each, becoming top losers.

India's wholesale price index for January came in at negative 0.39% vs expectation of 0.15%. November WPI has been revised to negative 0.17% from zero.

FIIs net sold stocks and stock futures worth Rs 183 cr and 390 cr respectively but net bought index futures worth Rs 512 cr. DIIs were net buyers to the tune of Rs 281 cr.

Rupee appreciated 4 paise to end at 62.155/$.

OUTLOOK

Today morning Asian markets are trading with modest gains and SGX Nifty is suggesting a flattish start for our market.

After four up days, it was a consolidation time on Monday as Nifty, after touching a high of 8870 in the initial trade, cooled off through rest of the session to end at 8809, gaining just four points compared to previous close.

8700 continues to be immediate support on the way down, with the stop loss of which trading longs should be held on to. On the way up, 8997, the top made in January, continues to be the target.

Ambuja Cement will report its quarterly earnings today.

NIFTY EXTENDS UPMOVE TO FOURTH DAY; STAY LONG WITH THE STOP LOSS OF 8700

NIFTY EXTENDS UPMOVE TO FOURTH DAY; STAY LONG WITH THE STOP LOSS OF 8700

WORLD MARKETS                             

US indices gained between 0.3%-0.8% on Friday with the Dow above 18,000 and S&P 500 setting a new record as firming oil prices sent the energy sector higher. Thursday's news of a cease-fire deal between Russia and Ukraine following months of violence between pro-Russian rebels and the Ukraine military also continued to a positive catalyst.

Nymex oil surged $1.57 or 3.10% to $52.78 a barrel while brent oil traded above. the number of oil rigs in the United States fell to the lowest level since August 2011.

Media reports suggested that Greek Prime Minister agreed to meet with representatives from the European Union, the European Central Bank and the International Monetary Fund, ahead of Monday's key Eurogroup meeting on debt talks.

Meanwhile, the European Central Bank allowed Greek banks to access extra emergency financing from the Bank of Greece because deposit outflows have increased and to ensure they have liquidity while discussions continue in Brussels next week.

Economic data had US consumer sentiment dropping 4.6% in February, missing expectations. U.S. import prices fell 2.8% last month, their biggest drop in six years as the cost of petroleum and a range of other goods fell, a sign that domestic inflation pressures could remain muted for a while. It was the seventh straight month of declines in import prices.

European markets gained between 0.4%-1.7% after fourth-quarter euro zone GDP rose 0.3% compared to the last quarter, which managed to beat expectations. Germany's number grew more than expected, expanding by 0.7% quarter-on-quarter, which bolstered hopes that the euro zone's largest economy is back on track.

AT HOME

It was a strong end to the week as benchmark indices soared a percent on Friday, extending the winning streak to fourth straight day and ending at the highest level since 30th January. Sensex settled at 29095, up 290 points while Nifty finished at 8806, up 94 points. BSE mid-cap and small-cap indices gained 0.7% and 0.4% respectively. Except a 1% and 0.2% cut in BSE Realty and Oil & Gas indices respectively, all other sectoral indices ended higher with FMCG and Healthcare indices leading the tally, putting on 1.8% and 1.6% respectively.

SBI soared after asset quality showed stability for the quarter ended December 2014. Net profit however rose lower-than-expected 30.3% to Rs 2910 cr, impacted by higher provisions. NII rose 9% to Rs 13777 cr, which was higher-than-expected. Gross NPA stood at 4.90 as against 4.89% in the previous quarter. Net NPA stood at 2.80% vs 2.73%.

M&M beat street expectations on bottom-line and top line front while operating performance was in line. Consolidated net profit grew 5.7% year-on-year to Rs 967 crore supported by an exceptional gain of Rs 299 crore. Total income fell 9.7% to Rs 9260 cr due to lower sales volumes. Consolidated operating profit was down 24.8% to Rs 1,080 crore and margin dropped 230 basis points to 11.7%

FIIs net bought stocks and index futures worth Rs 390 cr and 1137 cr respectively but net sold stock futures worth rs 430 cr. DIIs were net buyers to the tune of Rs 96 cr.

Rupee appreciated 11 paise to end at 62.195.

India's trade deficit for January fell to an 11-month low of $8.3 bn as exports contracted by 11.9% to $23.88 bn while imports fell 11.4% to $32.2 bn.

OUTLOOK

Today morning Asian markets are trading flat to modestly higher and SGX Nifty is suggesting about 10 points higher opening for our market.

In Friday's report we had mentioned that having crossed 8650-8700 resistance area, Nifty is headed to 8800, which is the 61.8% retracement level of the recent 8997-8470 fall.

The benchmark touched a high of 8822 before closing at 8805, achieving the target mentioned above. If one looks at the hourly chart, 8840 is the level where two previous tops are placed so that would be the next resistance to eye. Once that is taken out, 8997, the top made on 30th January, would be the next upside target.

On the way down, trendline adjoining recent bottoms on the hourly chart lands support around 8700, with the stop loss of which trading longs should be held on to.

NIFTY TAKES OUT 8700 HURDLE; SBI EARNINGS IN FOCUS TODAY

NIFTY TAKES OUT 8700 HURDLE; SBI EARNINGS IN FOCUS TODAY

WORLD MARKETS

US indices climbed between 0.6%-1.2% on the back of a cease-fire agreement between Russia and Ukraine, firming oil prices and strong earnings reports.

Russian President Vladimir Putin confirmed that he had agreed a peace deal with Ukraine. Speaking on Russian TV, Putin said the agreement would mean the removal of heavy weapons and a full ceasefire would be in place from midnight on February 15.

Cisco surge 9.4% on better-than-expected earnings to lead gains in the Dow.

US retail sales for January came in weaker than expected, down 0.8% and near December's 0.9% decline. Jobless claims were 304,000 last week, more than expected and an increase of 25,000 from last week.

Nymex oil surged 4.9% or $2.37 to $51.21 a barrel; Brent gained $2 to $57.

In Europe, except a marginally higher FTSE, other markets saw big gains ranging from 1%-2.1%.

                                                             

AT HOME

After a weakish morning trade, benchmark indices shot up nearly a percent and quarter from the bottom of the day in the noon trade to end higher by nearly a percent, registering the largest single day gain since 20th January and extending the winning streak to third straight day. Sensex settled at 28805, up 271 points while Nifty finished at 8712, up 84 points. BSE mid-cap and small-cap indices gained 1.1% and 1.3% respectively. Except a 0.2% cut in BSE FMCG index, all other sectoral indices ended in green with Power and Capital Goods indices leading the tally, putting on 2.5% and 2.3% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 406 cr, 619 cr and 214 cr respectively. DIIs were net buyers to the tune of Rs 706 cr.

Rupee depreciated 5 paise to end at 62.305/$.

Consumer price inflation for January, as measured by a new methodology, inched up to 5.11% y-o-y compared to 4.28% (also on new methodology) in December. Core inflation, calculated by taking out volatile food and fuel prices, moved down to 3.9% from 5.2%.

IIP for December stood at 1.7%, compared to 3.9% in November.

OUTLOOK

Today morning, barring a half a percent lower Nikkei, other Asian markets are trading with modest gains and SGX Nifty is suggesting about 30 points higher opening for our market.

Nifty yesterday crossed the 8650-8700 resistance area, generating a buy on the hourly chart. 8800, the 61.8% retracement level of the recent 8997-8470 fall, would be the immediate target to eye on the way up.

Immediate support on the hourly chart is placed at 8620, with the stop loss of which trading longs should be held on to.

SBI and M & M will report their quarterly earnings today.

NIFTY EXTENDS RECOVERY; CPI, IIP IN FOCUS TODAY

NIFTY EXTENDS RECOVERY; CPI, IIP IN FOCUS TODAY

WORLD MARKETS                             

Dow and S & P 500 ended little changed and Nasdaq ended higher by 0.3% after a choppy trading session as markets continued to watch for developments in negotiations between Greece and euro zone finance ministers. Nasdaq was boosted by more than 2% rise in Apple, which took the market cap of the firm to more than $700 bn.

Greek Finance Minister met with euro zone finance ministers yesterday where he was expected to unveil new reform proposals to make up for the ones that the new Greek government wants to scrap. He was also expected to ask for a "bridge program" to cover the government's funding needs while a new debt pact is agreed.

Other geopolitical developments included peace talks in Belarus by France, Germany, Russia and Ukraine, while fighting intensified in Kiev. President Barack Obama sent the text of his proposal to Congress regarding use of military force against the Islamic State.

Back in the US, economic data had budget deficit widening slightly in January and weekly mortgage applications falling 9%.

Crude oil inventories for the week rose to 4.9 million barrels, above expectations. Nymex crude fell 2.4% to $48.84 a barrel and Brent tumbled $3 to $54.80 a barrel. Gold lost 1% to $1220 an ounce.

Key European markets ended modestly lower while Spain tumbled 1.3%.

AT HOME

After a positive start, benchmark indices added some more gains through the choppy trading session to end higher by about two third of a percent, extending the recovery to second day. Sensex gained 178 points to settle at 28534 while Nifty finished at 8627, up 62 points. BSE mid-cap and small-cap indices gained 1.6% and 1.5% respectively. All the BSE sectoral indices ended in green with Capital Goods and Metal indices leading the tally, putting on 2% and 1.7% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 371 cr, 202 cr and 8 cr respectively. DIIs were net buyers to the tune of Rs 147 cr.

Rupee depreciated 7 paise to end at 62.25/$.

OUTLOOK

Even after more than six hours of negotiations over Greece, Eurozone finance ministers, along with the heads of the International Monetary Fund and the European Central Bank, failed to agree on a joint statement and said that they would keep talking in the coming days with the hope of coming up with a plan at their next meeting.

Today morning Nikkei is up nearly a percent and half on the back of weakening yen and better-than-expected core machinery orders for December. Other Asian markets are trading with modest cuts and SGX Nifty is suggesting a flattish start for our market.

We had advised booking profit in short positions after Nifty took support at the important 34-DMA mark placed around 8500. However we had also said that long positions should be initiated only after immediate resistance on the hourly chart, placed in 8650-8700 region, is taken out.

That continues to be the view. A crossover of this resistance area would generate a buy on the hourly chart and would pave the way for the further upside till about 8800, which is the 61.8% retracement level of the recent 8997-8470 fall.

Government will release CPI data for January with a new base. The range is seen between 5.3% -5.66%. In December, the figure stood at 5%.

December IIP will also be released today and is expected to show a growth of 1.8%, down from 3.8% in November.

BHEL, Coal India, Cipla and Hindalco will report their quarterly earnings today.

NIFTY REBOUNDS TO HOLD 34-DMA AND BREAK SEVEN DAY LOSING STREAK; 8650-8700 IS THE RESISTANCE AREA

NIFTY REBOUNDS TO HOLD 34-DMA AND BREAK SEVEN DAY LOSING STREAK; 8650-8700 IS THE RESISTANCE AREA

WORLD MARKETS

US indices climbed between 0.8%-1.3% on hopes of a resolution in the Greek debt negotiations, as well as better-than-expected revenues from Coca-Cola .

Despite Germany's stance that Greece needed to make a credible effort to recover itself with tighter public finances and economic reforms markets remained optimistic that a deal between Greece and the euro zone will be struck when the euro group of finance ministers meets in Brussels today where Greece's Finance Minister is expected to detail new reform proposals.

Boosting the sentiment was speculation that the European Commission could be ready to table a compromise on Greece's bailout program and propose a six-month extension to the country's bailout, which is due to end on February 28. The German Finance Minister later said the speculation was "wrong".

Back in the US, small business optimism fell 2.5 points to 97.9 in January amid worries over the near-term outlook. Wholesale inventories rose by lower-than-expected 0.1% in December.

The President of the Federal Reserve Bank of Richmond said that June 'looks like the attractive option' for raising rates.

Nymex crude tumbled $2.84 to $50.02 a barrel while Brent fell about $2 to $56, ending a three-day rally after the International Energy Agency (IEA) warned that oil prices may decline as oil stocks held by countries in the Organization for Economic Cooperation and Development continue to increase.

European markets, except a marginally lower FTSE, gained between 0.8%-1.8%. Greek stocks surged 8%.

Earlier, data out of China added to concerns of slowdown. China's consumer price index (CPI) rose 0.8% y-o-y in January, below a forecast for a 1%. The producer price index fell an annual 4.3%, worse than the 3.8% decline expected.

                                                             

AT HOME

After an extremely choppy trading session, benchmark indices managed to end higher by just under half a percent, breaking the seven day losing streak. Sensex settled at 28356, up 128 points while Nifty gained 39 points to finish at 8566. BSE mid-cap index gained 0.4% while the small-cap index ended lower by 0.1%. BSE Bankex and Auto index gained the most among the sectoral indices, rising 1.8% each while Oil & Gas and IT indices lost 0.9% and 0.7% respectively.

FIIs net sold stocks worth Rs 1261 cr but net bought index futures and stock futures worth Rs 403 cr and 80 cr respectively. DIIs were net buyers to the tune of Rs 851 cr.

Rupee depreciated 2 paise to end at 62.18/$.

In the Delhi assembly elections Aam Aadmi Party (AAP) decimated BJP and Congress by recording a landslide victory, securing 67 of the 70 seats.

OUTLOOK

Today morning, Asian markets are trading with modest gains and SGX Nifty is suggesting a flattish start for our market.

Just to reiterate, we have held negative bias on Nifty since 8850, the immediate support on the hourly chart was broken on 30th January. We had given an initial downside target of 8640, which was the 38.2% retracement level of the 8065-8997 upmove below which we had said that 8500, in the vicinity of which 34-DMA is placed, would be an important support to eye.

Yesterday, the benchmark, after touching a low of 8470 in the initial trade, finally ended at 8565, holding 34-DMA support on closing basis.

Traders are advised to book profits in short positions and initiate fresh ones if 8500 is breached on closing basis. On the way up, 8650-8700 is the immediate resistance zone, a crossover of which would generate a buy on the hourly chart and would pave the way for the further upside till about 8800, which is the 61.8% retracement level of the recent 8997-8470 fall.