NIFTY RETREATS FROM 7540-7600 HURDLE AREA; 7460 IS THE IMMEDIATE SUPPORT

NIFTY RETREATS FROM 7540-7600 HURDLE AREA; 7460 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow and Nasdaq ended marginally higher while S & P 500 lost 0.1% yesterday, digesting decline in oil prices and awaiting Fed meeting scheduled in the middle of the week.

Nymex oil fell $1.32 or 3.4% to $37.18 a barrel and Brent fell 2% to $39.53 as hopes of a coordinated production freeze faded. The Iranian News Agency Shana quoted Russian Energy Minister saying Russia accepts Iranian rights to increase oil output post sanctions. Over the weekend, Iran Oil Minister said the country would join discussions among other producers about a possible oil production freeze after its own output reached four million barrels per day.

OPEC also issued its latest report, saying it expected lower demand for its oil in 2016, than previously forecast.

European markets, except a marginally lower Italy, gained 0.6%-1.6% with DAX leading the tally. Industrial output in the euro zone rose dramatically in January, by 2.1% month-on-month, above forecasts of 1.7%.

Gold fell $14 to $1245 an ounce.

AT HOME

After rising nearly a percent in the initial trade, benchmark indices gave away more than half of the gains through the session to end higher by about four tenth of a percent, nevertheless closing at the highest level since 1st February. Sensex settled at 24804, up 86 points while Nifty added 29 points to finish at 7539. BSE mid-cap and small-cap indices gained 0.3% and 0.4% respectively. BSE Bankex and Industrial indices gained 0.8% and 0.7% respectively, becoming top gainers among the sectoral indices while Metal index plunged 2%, becoming top loser, followed by 0.5% cut in Energy index.

FIIs net bought stocks and index futures worth Rs 1036 cr and 861 cr respectively but net sold stock futures worth Rs 253 cr. DIIs were net sellers to the tune of Rs 805 cr.

Rupee depreciated 7 paise to end at 67.11/$.

Retail inflation, as measured by Consumer Price Index fell to 5.18% y-o-y in February, as against forecast of a 5.53% and 5.61% in January.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had explained that 7540-7600 is an important resistance area a crossover of which is required for the fresh upmove.

The benchmark, after touching a high of 7584 in the initial trade, slipped to close at 7539.

7540-7600 continues to be the hurdle area a crossover of which would open up the space for the further upside till about 34-week moving average, which is currently placed around 7815.

Immediate support is placed around 7460, a sustained trading below which will generate a sell on the hourly chart and can take the benchmark to around 7300, where 34-DMA is placed.