STAY LONG WITH THE STOP LOSS OF 7770

STAY LONG WITH THE STOP LOSS OF 7770

WORLD MARKETS                             

US indices ended with modest cuts on Friday with energy sector leading the losses ahead of a highly anticipated weekend meeting of oil producers.

Nymex oil fell $1.14 or 2.8% to $40.36 a barrel. Earlier, Baker Hughes said the weekly oil rig count fell 3 to 351.

Empire State Manufacturing Survey rose nine points in April to 9.6, its highest in more than a year, while industrial production fell a more-than-expected 0.6% in March. Capacity utilization also declined to 74.8%, the lowest level since August 2010. The preliminary consumer sentiment for April was 89.7, missing expectations for a slight rise to March's final read of 91.

Citigroup reported better-than-expected earnings and revenue.

Earlier data showed China's GDP grew at an annual rate of 6.7% in the first quarter, a tad below the fourth-quarter's 6.8% rate. Retail sales edged up to 10.5% in March, while fixed-asset investment growth rose to 10.7% year-on-year in the first quarter. Industrial output growth jumped to 6.8% from 5.4%.

Key European markets lost about four tenth of a percent.

Gold rose $8 to $1235 an ounce.

For the week, Dow and Nadaq rose 1.8% each while S & P 500 rose 1.6%. In Europe, FTSE rose 2.2% while DAX and CAC soared 4.5% each. In Asia, Nikkei climbed 6.5%, Hang Seng soared 4.6% and Shanghai rose 3.1%.

AT HOME

After a big gap up opening, benchmark indices added equal amount of gains through rest of the session to end with hefty gains of just under two percent. Sensex soared 481 points to settle at 25627 while Nifty ended at 7850, up 141 points. BSE mid-cap and small-cap indices gained 0.9% and 1.1% respectively. Both the indices closed at the highest level since 1st January. All the BSE sectoral indices ended in green with Auto index and Bankex leading the tally, up 3.6% and 2.6% respectively.

FIIs net bought stocks and index futures worth Rs 644 cr and 1679 cr respectively but net sold stock futures worth Rs 71 cr. DIIs were net buyers to the tune of Rs 270 cr.

Infosys reported better-than-expected profit 3.8% q-o-q growth in net profit at Rs 3597 cr. Revenue rose 4.1% to Rs 16550 cr. Dollar revenue rose 1.6% to USD 2446 mn and 1.9% in constant currency. The company expects FY17 revenue growth at 11.5%-13.5% in constant currency and 11.8%-13.8% in dollar terms, which is far better than industry guidance.

For the week, Sensex and Nifty gained 3.9% each.

OUTLOOK

Yesterday, the meeting between the world's largest oil producing countries in Doha failed to produce a deal to freeze output and boost sagging crude prices. Nymex oil is down 5.6% at $38.08 on account of this and Brent is down 5.1% to $40.89.

Today morning, Nikkei is down nearly 3%, weighed down by stronger Yen and a powerful earthquake that struck southern Japan on Saturday. Other Asian markets are trading with cuts of upto a percent and half. SGX Nifty is trading around 7890, which is about 25 points higher than Wednesday's close of Nifty future.

In Wednesday's report a decisive crossover of 7778, the top made in March, would open up the further upside till about 7875 where 200-DMA is placed. The benchmark soared 141 points to close at 7850, crossing 7778 and moving towards 7875 target.

A higher opening today would see the target of 7875 getting achieved. Above 7875, next target to eye would be about 7975, where previous two tops made in December and January 2015 are placed.

7770-7720, the gap created by the gap up opening on Wednesday, would now serve as the immediate support, with the stop loss of which trading longs should be held on to.