8655 CONTINUES TO BE MAJOR TARGET; 8475 IMMEDIATE SUPPORT

8655 CONTINUES TO BE MAJOR TARGET; 8475 IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow ended marginally higher while S & P 500 and Nasdaq lost 0.1% each on Friday, pausing after a massive rally over past couple of days.

US Retail sales beat expectations, rising 0.6% in June versus consensus of a 0.1% increase. Consumer prices increased 0.2% last month, marking the fourth straight month of uptick. Preliminary reading of University of Michigan's consumer sentiment index came in at 89.5, lower than the expected 93 mark.

Wells Fargo reported results in-line with consensus, and Citigroup reported better-than-expected earnings.

The Turkish lira plummeted against the dollar and the euro after an apparent attempted coup against the Turkish government.

WTI oil rose 27 cents or 0.6% to $45.95 a barrel. Gold fell $5 to $1327 per ounce.

European markets, except a 0.2% higher FTSE, ended with cuts of upto 0.3% following a terror attack in France that killed at least 84 people.

Earlier data from China showed that economy expanded faster-than-expected in the second quarter with gross domestic product growing 6.7%, helping to allay fears about trouble in the world's second-largest economy.

For the week, Dow soared 2% while S & P 500 and Nasdaq gained 1.5% each, extending the winning streak to third straight week and closing at record high. In Europe, FTSE rose 1.2% while DAX and CAC climbed more than 4%. In Asia, Nikkei jumped 9.2%, Hang seng added 5.3% and Shanghai rose 2.2%.

AT HOME

After scaling fresh 11-month high in the initial trade, benchmark indices, weighed down by big cut in Infosys stock on the back of disappointing earnings, slipped to end lower by about a third of a percent on Friday. Sensex lost 106 points to settle at 27836 while Nifty finished at 8541, down 24 points. BSE mid-cap index gained 0.1% while the small-cap index fell 0.7%. BSE IT index plunged 5.4%, becoming top loser among the sectoral indices followed by 3.9% lower Teck index. Telecom index climbed 2.3% to become top gainer, followed by 1% higher Auto index.

FIIs net bought stocks and index futures worth Rs 1461 cr and 723 cr respectively but net sold stock futures worth Rs 774 cr. DIIs were net sellers to the tune of Rs 1034 cr.

Rupee depreciated 15 paise to end at 67.06/$.

Infosys nosedived after it June quarter results and full year guidance disappointed. Net profit fell 4.5% q-o-q to Rs 3436 cr and revenue rose 1.4% to Rs 16782 cr. Revenue in dollar terms grew by 2.2% to USD 2501 mn and constant currency dollar revenue growth stood at 1.7%. The company lowered its FY17 constant currency revenue growth guidance to 10.5-12.5% from 11.5-13.5% earlier.

Reliance Industries, as against the expectation of an 11% sequential drop, reported a 4.5% growth at Rs 7548 cr as GRM's jumped to a record $11.5/bbl v/s previous quarters $10.8 and expected figure of $9.8. However out of this $2 were on account of inventory gain, stripped of which GRM were roughly in-line with estimates.

June trade data showed that exports rose 1.3% to USD 22.57 bn, showing a positive growth after 18 consecutive months of contraction. Trade deficit however widened to the highest level of 2016 at USD 8.11 bn from 6.27 bn, as imports rose to 30.68 bn.

Oil marketing companies cut petrol and diesel prices by Rs 2.25 and 42 paise per liter respectively.

For the week, Sensex and Nifty gained 2.6% each.

OUTLOOK

Today morning, except a modestly lower Shanghai, other Asian markets are trading with gains of upto half a percent and SGX Nifty is suggesting about 25 points higher start for our market.

Nifty, on Friday, after touching a high of 8595 in the initial trade, eased to close at 8541 but is set to open higher today.

As we have been mentioning, 8655, the top made in July 2015, which is also the 52-week high, continues to be major upside target.

Immediate support on hourly chart has moved up to 8475, which should serve as the revised stop loss for trading longs.

HUL will report its quarterly earnings today.

Monsoon session of the Parliament starts today. There are 11 bills pending in Lok Sabha and 45 bills pending in Rajya Sabah. Most important among them would the GST.