NIFTY CONSOLIDATES AMIDST BROADER MARKET OUT-PERFORMANCE

NIFTY CONSOLIDATES AMIDST BROADER MARKET OUT-PERFORMANCE

WORLD MARKETS                             

US indices fell 0.2%-0.6% yesterday, with the Dow snapping a three-day winning streak, weighed down by earnings-related selling in Wal-Mart and a drop in commodity names due to concerns over the Chinese economy

Shanghai Composite dropped 6.12% and closed at its lowest level since Aug. 7 amid renewed concerns that the Chinese government could further devalue the yuan. Yuan declined further, despite the People's Bank of China raising the midpoint rate of the currency to 6.3966 per U.S. dollar—slightly firmer than the previous fix of 6.3969.

Wal-Mart fell 3.4% after reporting quarterly earnings that missed expectations and also cut its full-year guidance.

U.S. housing starts for July came in at 1.206 million, above what economists expected and near an eight-year high. June's figure was also revised higher.

European markets ended with cuts of upto 0.4%

Nymex crude rose 57 cents to $42.44 a barrel. Brent however fell 8 cents to $48.66 a barrel.

AT HOME

After rising nearly half a percent in the initial trade, benchmark indices tumbled later to end modestly lower. Sensex settled at 27832, down 47 points while Nifty lost 11 points to finish at 8467. BSE mid-cap and small-cap indices bucked the trend yet again, rising 0.5% and 0.8% respectively. BSE IT and Consumer Durable indices rose 1.6% and 1.2% respectively, becoming top gainers among the sectoral indices while Metal and Healthcare indices were the top losers, down 1.9% and 0.6% respectively.

FIIs net sold stocks worth Rs 255 cr but net bought index futures and stock futures worth Rs 19 cr and 408 cr respectively. DIIs were net buyers to the tune of Rs 128 cr.

Ratings agency Moody's downgraded India's 2015-16 GDP growth target to 7% from 7.5% earlier in light of a drier than average monsoon, though it added that it expects GDP growth to go back to 7.5% in the next fiscal.

OUTLOOK

Today morning, Shanghai is down nearly 2%, other Asian markets are trading with cuts of 0.5%-1% and SGX Nifty is suggesting about 20 points lower opening for our market.

8410, the 61.8% retracement level of the recent 8338-8531 pullback, continues to be immediate support, a breach of which would take Nifty back to 8315-8340 support area.

On the way up, 8610, where the trendline adjoining recent top on the daily chart is placed, continues to be the resistance area.

"Hold on to trading longs with the stop loss of 8410" continues to be the advice.

Federal Reserve is scheduled to release the minutes from its July meeting today.

German parliament will vote today on whether to support Greece's prospective third bailout.