OIL, GOLD WITNESS FRESH SELLING; NIFTY CLOSE TO 8670 HURDLE AFTER A MAMMOTH REBOUND

OIL, GOLD WITNESS FRESH SELLING; NIFTY CLOSE TO 8670 HURDLE AFTER A MAMMOTH REBOUND

WORLD MARKETS

US indices lost 0.25%-0.7% yesterday, weighed down by disappointing tech earnings.

Apple fell 4.3% after the firm's fourth-quarter revenue forecast fell short of expectations and it missed some targets for iPhone sales. Microsoft fell 3.7% after posting a $3.2 billion net loss for its fiscal fourth quarter ending June 30 following restructuring charges. On the other hand Boeing and Coca-Cola reported better-than-estimated earnings.

Commodities remained in focus. Nymex oil tumbled $1.67 to $49.15 a barrel after the US energy department said oil inventories rose by about 2.5 million barrels. Gold fell $12 to $1092 an ounce, extending its losing streak to 10 session and closing at the lowest level since March 25 2010.

In economic news, U.S. home prices rose 0.4% in May from April, up from 5.7% a year ago. Existing home sales rose 3.2% from the previous month in June, their highest levels in over eight years.

European markets, except a 0.2% higher Spain, fall upto 1.5%, with FTSE leading the tally.

                                                             

AT HOME

After falling nearly a third of a percent in the opening trade, benchmark indices saw a sustained upward move through the session to end with hefty gains of more than a percent to close at fresh three-month high. Sensex soared 311 points to settle at 28493 while Nifty finished at 8633, up 104 points. BSE mid-cap and small-cap indices gained 1.3% and 0.9% respectively. Except a 0.5% and 0.4% cut in BSE IT and Teck indices respectively, all the sectoral indices closed in green with Oil & Gas index and Bankex leading the tally, climbing 2.4% and 1.4% respectively

FIIs net bought stocks worth Rs 450 cr but net sold index futures and stock futures worth Rs 295 cr and 263 cr respectively. DIIs were net sellers to the tune of Rs 352 cr.

Rupee depreciated 3 paise to end at 63.575/$.

Yesterday, both Lok Sabha and Rajya Saba were adjourned for the day after repeated disruption by the opposition on "Lalitgate" and "vyapam" issue.

The GST bill yesterday won majority support of the Rajya Sabha Select Committee, which endorsed almost all the provisions while also agreeing to demands of parties like TMC for a five-year compensation to states.

The report, however, is marked by dissent notes from Congress, AIADMK and Left parties, which have expressed their opposition to the GST Constitution Amendment Bill in the existing form. The bill, which has already been approved by Lok Sabha, will now have to be taken up for passage in the Upper House. As it is a Constitution Amendment Bill, the bill has to be approved by two-third members in the Rajya Sabha. The ruling BJP government does not have a majority in Rajya Sabha and will have to depend upon support of regional parties and allies for passage of the bill.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 10 points lower opening for our market.

Yesterday, after touching a low of 8499 in the initial trade, Nifty rebounded sharply to end at 8633. After yesterday's mammoth move, the benchmark is again close to 8670, the 61.8% retracement level of the whole 9119-7940 fall, which we had mentioned as the first target when 8490 was taken out.

Upon crossover of 8670, 8845, the top made in April, would be the next target to eye. 8490, the erstwhile top on the weekly chart which roughly coincides with yesterday's low, is the immediate support.

Traders are advised to wait for the crossover of 8670 before taking fresh longs.

Wipro, Bajaj Auto, UPL and Lupin will report their quarterly earnings today.