NIFTY SET TO ACHIEVE 34-DMA TARGET; RBI IN FOCUS

NIFTY SET TO ACHIEVE 34-DMA TARGET; RBI IN FOCUS

WORLD MARKETS                             

US indices, after a negative start, saw a sustained northward move through the session to end higher by nearly two third of a percent as last week's weak jobs data renewed hopes of a delayed increase in interest rates.

The ISM non-manufacturing Index was 56.5 in March, its lowest level in three months but in line with estimates. The Markit Purchasing Managers Index rose to 59.2 in March, the highest level since August

Nymex oil shot up $3 or 6.1% to $52.14 a barrel. Brent rose $2.9 to $57.80 a barrel.

European markets were closed for Easter Monday.

AT HOME

After a lackluster morning trade, benchmark indices jumped up in the noon trade to end higher by nine tenth of a percent, closing at the highest level since 19th March. Sensex soared 244 points to settle at 28504 while Nifty finished at 8660, up 74 points. BSE mid-cap and small-cap indices gained 1.1% and 1.4% respectively. Except a 0.4% and 0.01% lower Metal index and Bankex respectively, all the BSE sectoral indices ended higher with Realty and Healthcare indices leading the tally, putting on 6.4% and 4.8% respectively.

Rupee appreciated 31 paise to end at 62.18/$.

India's HSBC Services PMI eased to 53 in March from February's eight month high of 53.9.

OUTLOOK

Today morning Asian markets are trading with gains ranging from 0.5%-1% and SGX Nifty is suggesting about 25 points higher opening for our market.

Readers would recall that we had recommended going long when immediate hurdle of 8510 was taken out for the target of 8710, where the 34-DMA is placed.

Nifty gained 74 points yesterday to end at 8660 and is on track to achieve above mentioned target. Above 8710, 61.8% retracement level of the 9119-8269 fall, placed around 8800, would be the next target.

Immediate support on the hourly chart is placed at 8550, with the stop loss of which trading longs should be held on to.

The key event to watch out today would be RBI's first monetary policy review in the new financial year. While no change is expected in repo rate, markets would watch out for RBI's assessment of the new year, its growth and inflation forecasts as also Governor Rajan's view on the prevailing external environment. There are some expectations of SLR cut and a little expectation regarding the CRR cut.