US EQUITIES RISE ON STRONG DATA; NIFTY CONSOLIDATES AROUND 34-WEEK AVERAGE

US EQUITIES RISE ON STRONG DATA; NIFTY CONSOLIDATES AROUND 34-WEEK AVERAGE

WORLD MARKETS

Dow and S & P 500 gained 0.6% each while Nasdaq rose 0.9% on Friday following encouraging data on employment and manufacturing.

The March employment report showed creation of 215,000 jobs, with the unemployment rate edging up to 5.0 percent and average hourly earnings rising seven cents. The labor force participation rate rose to 63%, its highest level since March 2014.

ISM manufacturing for March came in at 51.8, topping expectations and up from February's 49.5 print. February construction spending declined 0.5%. The final University of Michigan consumer sentiment read for March was 91.0. Earlier, the March U.S. Markit manufacturing PMI came in at 51.5.

Nymex oil plunged $1.55 or 4% to $36.79 a barrel, wiping out gains for the eyar so far on renewed oversupply concerns, after reports that Saudi Arabia would not agree to a production freeze unless Iran and other major producers also did so.  Brent fell $1.63 or 4% to $38.70 a barrel.

Dollar index ended flat. Gold fell $12 to $1223 an ounce.

Earlier Nikkei  plunged 3.6% percent Friday after the Bank of Japan's quarterly "tankan" survey showed the headline index for big manufacturers' sentiment stood at plus 6 in March, missing expectations and down from plus 12 seen three months ago. The Shanghai composite closed up 0.2%. China's official PMI came in at 50.2 in March, up from 49.0 the prior month, while the Caixin manufacturing PMI for March rose to 49.7 from 48.0 in February. The official services PMI also rose to 53.8 in March.

European markets fell 0.5%-1.9%. Standard and Poor's cut its outlook for the Chinese government's credit rating which weighed on stocks with exposure to China. The euro zone's March manufacturing PMI came in at 51.6 up from 51.2 in February.

For the week, US indices gained 1.6%-3%, their sixth positive week in the last seven. The pan-European STOXX 600 closed 0.8% lower for the week. The US dollar index fell 1.6% for the week, its worst since early February. Gold eked out a gain of 0.2% for the week, its first positive week in four.

                                                             

AT HOME

Benchmark indices ended lower by three tenth of a percent on the first day of the new financial year. Sensex lost 72 points to settle at 25270 while Nifty finished at 7713, down 25 points. BSE mid-cap and small-cap indices however gained 0.2% and 0.9% respectively. BSE Telecom and Oil & Gas indices lost 2.4% and 1.2% respectively, becoming top losers among the sectoral indices while Realty and Capital Goods indices were the top gainers, up 3% and 1.2% respectively.

FIIs net bought stocks worth Rs 214 cr but net sold index futures and stock futures worth Rs 387 cr and 442 cr respectively. DIIs were net sellers to the tune of Rs 520 cr.

Rupee depreciated 1 paise to end at 66.26/$.

Maruti reported 15.9% y-o-y growth in March sales at 1.29 lakh units. Ashok Leyland sold 31% higher units at 16702.  M & M saw a growth of 17% at 52718 units. Eicher registered 50% growth in CV sales at 6753 units and sold 51320 Royal Enfields, up 52%. Hero Motocorp sold 6.06 vehicles, a growth of 14%. TVS Motor sold 10% more units at 2.32 lac units while Tata Motors sales stood at 53057 units, a growth of 1%.

For the week, Sensex lost 0.3% while Nifty ended little changed.

OUTLOOK

Today morning, Asian markets are trading flat to modestly higher and SGX Nifty is suggesting about 15 points higher opening for our market.

Nifty, for past couple of days, has been consolidating around 34-week moving average that we had pointed out as the important resistance area.

7778 is the top it made recently and once that level is taken out, the upmove can extend to around 7890, where the 200-DMA is placed. On the way down 7666, the bottom made on Friday, is the immediate support, below which 7582, the bottom made last week would be the important support to eye.