INFY, IIP AND CPI IN FOCUS; STAY LONG WITH THE STOP LOSS OF 8110

INFY, IIP AND CPI IN FOCUS; STAY LONG WITH THE STOP LOSS OF 8110

WORLD MARKETS                             

US indices gained upto 0.4% on Friday, digesting dovish signals from the U.S. Federal Reserve minutes.

The September Fed meeting minutes released Thursday afternoon indicated policymakers were concerned about reaching their inflation target of 2% and the impact of the global economic slowdown. The minutes said policymakers don't expect to reach their inflation goal before the end of 2018.

On the data front, import prices fell 0.1% in September, less than the expected 0.5% drop. However, export prices fell 0.7%, more than the 0.2% forecast.

Nymex oil rose 20 cents to $49.63 a barrel, up more than 8% for the week. The U.S. oil rig count dropped for the sixth straight week, down 9. Gold rose $12 to $1156 an ounce.

Earlier Nikkei finished 1.6% higher and Shanghai gained 1.3%.

European markets gained between 0.5%-1%. Glencore closed up 7% after it cut about a third of its annual zinc output due to low prices

For the week, S & P 500 climbed 3.3%, its best since the week ended Dec 19, 2014. Dow gained 3.7%, its second-best week of the year so far. Nasdaq rose 2.6%. European markets soared 4.7%-7.4%.

AT HOME

Benchmark indices ended higher by nearly eight tenth of a percent after a choppy trade on last day of the week. Sensex settled at 27080, up 234 points while Nifty rose 60 points to finish at 8190. BSE mid-cap index lost 0.1% while the small-cap index gained 0.2%. BSE IT and Teck indices gained 1.5% and 1.3% respectively, becoming top gainers among the sectoral indices while Consumer Durable and Power indices lost 0.2% and 0.1% respectively.

FIIs net bought stocks and index futures worth Rs 484 cr and 437 cr respectively but net sold stock futures worth Rs 534 cr. DIIs were net sellers to the tune of Rs 369 cr.

Rupee appreciated 31 paise to end at 64.735/$.

For the week, Sensex and Nifty gained 3.3% and 3% respectively, extending rising streak to second week.

Indusind Bank reported better-than-expected 30.2% y-o-y rise in September quarter net profit at Rs 560 cr. NII rose 31.3% to Rs 1094 cr. Gross NPA ratio improved to 0.77% from 0.79% q-o-q while net NPA ratio remained unchanged at 0.31%. Provisions against bad loans increased 28% q-o-q to Rs 158 cr.

OUTLOOK

Today morning Asian markets are trading with gains of 0.5-1.5% and SGX Nifty is suggesting about 30 points higher opening for our market.

Ever since Nifty established higher-top higher-bottom formation on the daily chart by crossing 8055 top on 5th October, we had been working with an initial target of 8220, followed by 8380.

The benchmark on Friday touched a high of 8232 before closing at 8190, achieving the first target mentioned above.

8355-8380 is the next target area, where 8355 is 34-week moving average and 8380 is 200-DMA.

Immediate support on the hourly chart has moved up to 8110, with the stop loss of which trading longs can be held on to.

Tech major Infosys will report its quarterly earnings today. Dollar revenue is expected to rise 3.6% q-o-q to $2337 mn. In rupee terms, revenue is expected 5.9% at Rs 15210 cr and profit is expected to rise 7% to Rs 3244 cr. Margin is expected to improve by 100 bps to 25%. 3244. The company is expected to maintain its FY16 revenue growth guidance of 10-12% in constant currency and 7.2-9.2% in dollar terms.

CPI for September would be released today and is expected to show a reading of 4.49%, up from 3.66% in August. Core CPI is expected to be around 4.2-4.3%.

IIP for August would also be released today and is expected to show a growth of 5%, up from 4.2% in July.

The first phase of Bihar assembly election will be held today.