NIFTY TUMBLES AFTER GETTING RESISTED EXACTLY AT 8850

NIFTY TUMBLES AFTER GETTING RESISTED EXACTLY AT 8850

WORLD MARKETS

US indices fell between 0.4%-0.8% on Friday on dollar surge and oil plunge.

Dollar index rose more than half a percent to a new 52-week high, for its first close above 100 since April 2003. The euro extended losses to fall below $1.05.

Nymex oil fell $2.21 or 4.7% to $44.84 a barrel.

The Dow and S&P 500 posted their third week of declines, losing 0.6% and 0.9% respectively, while the Nasdaq closed lower for the second straight week, down 1.1%.

The U.S. Producer Price index for February showed a decline of 0.5%, missing estimates of a 0.3% gain. Consumer sentiment data showed a preliminary read of 91.2 in March versus 95.4 in February.

In Europe, FTSE and Italy fell about a third of a percent while DAX, CAC and Spain ended higher.

Central Bank of Russia cut key rate by 1% to 14% on Friday, in an effort to stimulate the country's sanctions-hit economy.

AT HOME

After a gap up opening, benchmark indices nosedived more than 2% from the top of the day to end lower by a percent and half and closing at one-month low. Sensex plunged 427 points to settle at 28503 while Nifty finished at 8648, down 128 points. BSE mid-cap and small-cap indices lost 1.4% and 1.5% respectively. All the BSE sectoral indices ended in red with Capital Goods index leading the tally with 2.6% fall, followed by 1.9% cut in FMCG index and Bankex.

 For the week, Sensex and Nifty lost 3.2% each, registering largest weekly fall in 3-months.

FIIs net bought stocks, index futures and stock futures worth Rs 67 cr, 5 cr and 901 cr respectively. DIIs were net sellers to the tune of Rs 68 cr.

Rupee fell 47 paise to end at 62.96/$.

India's trade deficit in February narrowed to $6.84 bn from $8.31 bn in January as imports dipped 15.66% to $28.39 bn while exports fell 15.02% to $21.54 bn.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 30 points lower opening for our market.

In Friday's report we had mentioned that the immediate resistance on the hourly chart is placed at 8850, a sustained trading above which is required to generate a buy on the hourly chart.

The benchmark, in a gap up opening on Friday, opened exactly at 8850, from where it sold off sharply to end at 8648.

8850 continues to immediate hurdle. On the way down, by closing below the immediate previous bottom of 8670, the benchmark has broken the higher-top higher-bottom formation on the daily chart which has opened up the space for the further retracement of the entire 7961-9119 upmove. 8540 and 8403, the 50% and 61.8% retracement levels of this upmov, would be the downside targets to eye.

India’s WPI for February would be released today and is expected to show a contraction of 0.65% as against contraction of 0.39% in January.