8700 ABOVE 8550; 8450 IS THE IMMEDIATE SUPPORT

8700 ABOVE 8550; 8450 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices fell in the vicinity of a percent as investors eyed mixed economic data and the end of the first quarter.

Low oil prices also continued to weigh, as Iran and six world powers negotiated a deal that could ease sanctions and allow more Iranian crude into world markets. Nymex crude fell $1.08, or 2.2%, at $47.60 a barrel on Tuesday.

A reading on consumer confidence showed an increase to 101.3 in March, above February's 98.8. Chicago PMI for March posted 46.3, a slight increase from last month but below expectations for 51.5. Case-Shiller house price indices for January showed an increase in prices from last year.

Key European markets fell between 1%-1.7%. Euro zone unemployment rate fell to 11.3% in February, from 11.4% in January. This was its lowest rate since May 2012. A flash figure for euro zone inflation came in at -0.1% in March, up from February's number.

AT HOME

After rising nearly two third of a percent, benchmark indices saw a sudden fall post 2 O'clock to end marginally in the red. Sensex settled at 27957, down 18 points while Nifty lost 1 point to settle at 8491. BSE mid-cap and small-cap indices however gained 0.3% and 0.9% respectively.   BSE Oil & Gas and Healthcare indices gained the most among the sectoral indices, rising 1.2% and 1% respectively while Bankex and Capital Goods index were the top losers, giving away 0.8% and 0.5% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 356 cr, 588 cr and 631 cr respectively. DIIs were net buyers to the tune of Rs 284 cr.

Rupee appreciated 18 paise to end at 62.49/$.

Core Sector growth fell to 1.4% in February versus 1.8% in January.

The government yesterday lowered the price of natural gas by 7.72% to $4.66 per mmBtu with effect from 1 April in a move that will benefit consumers, but dent the revenues of domestic gas producers such as state-owned Oil and Natural Gas Corp. Ltd (ONGC) and Reliance Industries Ltd (RIL).

The government has finally achieved the 4.1% deficit target for FY15, despite a shortage of around 45,000 cr. Some much need spectrum auction proceeds of around 8,000 cr - 9,000 cr‎ has come to the rescue of the finance ministry. However, tight curbs on expenditure, including maintaining the 15% cap on March expenditure, and remaining within the 33% expenditure limit for Jan-March, has helped the govt meet the FD target.

OUTLOOK

China's official manufacturing PMI for March has come in at 50.1, up from February's 49.9 and better than the expected reading of 49.8. The HSBC version of the manufacturing PMI has come in at 49.6, which is down from 50.7 in February but up from the flash reading of 49.2.

Hang Seng is up about half a percent, Shanghai is flat, while other Asian markets are trading with modest cuts. SGX Nifty is suggesting about 10 points lower opening for our market.

In yesterday's report we had advised going long above 8510, keeping a stop loss of 8460, for target of 8600. The benchmark, after touching a high of 8550, saw a sudden fall to 8454 and finally settled at 8491.

34-hour average, which was at 8460 on Monday, has moved lower to 8450 yesterday and one can keep that as a stop loss for trading longs. However, fresh longs should be initiated only above 8550, as that is where the trendline resistance adjoining recent tops on the daily chart is placed. A crossover of 8550 can take the benchmark to around 8710, where the 34-DMA is placed.

Auto companies will report their March sales figures today.

Indian markets will remain shut tomorrow and day after for Mahavir Jayanti and Good Friday respectively.