NIFTY TAKES OUT 8243 HURDLE; 8186 IS THE IMMEDIATE SUPPORT

NIFTY TAKES OUT 8243 HURDLE; 8186 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow and S & P 500 came off the day high to end higher by 0.1% each while Nasdaq lost 0.1% yesterday. Healthcare stocks declined the most while energy was the top performer as US oil rose 67 cents or 1.4% to settle at $50.36, its first close above $50 since July 21 on the back of a weaker dollar and falling Nigerian oil output. Brent was up 1.8% at $51.44.

First quarter productivity, which measures hourly output per worker, contracted at an annualized rate of 0.6%, instead of the 1.0% pace reported last month. Unit labor costs, the price of labor per single unit of output, increased at an upwardly revised 4.5% pace.

European markets gained 0.2%-2% with Italy leading the tally. Euro zone GDP grew 0.6% q-o-q and by 1.7% y-o-y in the first quarter. The German 10-year bund yield fell to fresh all-time low near 0.04%, amid uncertainty around the U.K. vote on whether to leave the European Union, and ahead of the European Central Bank's corporate bond buying program set to begin Wednesday.

US dollar index fell to 93.85 from 94.02.

AT HOME

After a positive start, benchmark indices builded on these gains through the session to end higher by about eight tenth of a percent and closing at fresh high since late October. Sensex added 232 points to settle at 27010 while Nifty finished at 8266, up 65 points. BSE mid-cap and small-cap indices gained 0.3% and 1% respectively. BSE Realty index and Bankex climbed 1.7% and 1.6% respectively, becoming top gainers among the sectoral indices while Oil & Gas and Teck indices fell 0.1% and 0.05% respectively.

FIIs net bought stocks and index futures worth Rs 500 cr and 257 cr respectively but net sold stock futures worth Rs 333 cr. DIIs were net buyers to the tune of Rs 46 cr.

Rupee appreciated 19 paise to end at $66.77, its strongest level in 3-weeks.

RBI, in its bi-monthly policy review, left key rates unchanged as expected. However, the central bank warned that inflation risks were on the upside even as it retained the inflation targets set out in the April policy. On the positive side, the RBI said its policy stance continues to remain 'accommodative.' The apex bank retained GDP growth target for the current fiscal at 7.6%.

The Indian Meteorological Department yesterday said that the south-west monsoon will hit Kerala coat on 9th June, a delay of 2 days compared to earlier forecast.

In what could be good news to mobile operators, the inter-ministerial panel Telecom Commission today backed lowering of spectrum usage charge to 3 per cent of their annual revenue.

OUTLOOK

Today morning Asian markets are trading flat to modestly lower and SGX Nifty is suggesting a flattish start for our market.

Nifty, after touching a high of 8295, closed at 8266 yesterday, taking out the 8243 hurdle, after consolidating near it for couple of days.

As we have been mentioning 8336, the top made in October 2015, is the immediate target above 8243 while next major target, if the benchmark sustains above 8243, preferably on weekly basis, would be 8655, the top made in July 2015, which is also the 52-week high.

Immediate support on the hourly chart has moved up to 8186, which should serve as the stop-loss for trading longs.