NIFTY BREAKS TWO-DAY LOSING STREAK, MOVES CLOSER TO UPPER RANGE OF CONSOLIDATION

NIFTY BREAKS TWO-DAY LOSING STREAK, MOVES CLOSER TO UPPER RANGE OF CONSOLIDATION

WORLD MARKETS                             

Dow rose 0.1% while S & P 500 and Nasdaq added 0.2% each after a choppy trading session amid rising oil prices

US crude rose 3% to $48.22 a barrel, it's highest settle since July 1, and Brent added 2% to $50.89 on further news suggesting OPEC and other major exporters could consider a deal to tackle the global oversupply.

Wal-Mart rose 1.9% after reporting better-than-expected earnings and revenue and raising its full-year guidance.

Weekly jobless claims fell 4000 to 262000. Leading indicators rose 0.4% last month, slightly more than expected.

Dollar index fell 0.7%. Gold gained $8 to $1357 an ounce.

European markets gained 0.1%-0.9%. Basic resources outperformed on the back of gains in commodities. U.K.'s retail sales for July were up 1.4% compared with June, beating a poll of 0.2%.

AT HOME

Sensex and Nifty gained 0.4% and 0.6% respectively, breaking the two-day losing streak but extending more than two-week consolidation. Sensex added 118 points to settle at 28123 while Nifty finished at 8673, up 49 points. BSE mid-cap and small-cap indices rose 0.4% and 1% respectively. BSE Utilities and Power indices climbed 1.8% each, becoming top gainers among the sectoral indices, followed by 1.6% rise in Bankex. Metal and Consumer Durable indices were the top losers, down 0.6% and 0.5% each.

FIIs net bought stocks, index futures and stock futures worth Rs 162 cr, 45 cr and 196 cr respectively. DIIs were net sellers to the tune of Rs 14 cr.

Rupee depreciated 5 paise to end at 66.81/$.

OUTLOOK

Today morning, Nikkei is up about half a percent, other Asian markets are trading flat to modestly higher and SGX Nifty is suggesting a marginally higher start for our market.

As we have been mentioning, Nifty is in a consolidation mode for more than two-weeks after a big 10% upmove since June 24. We have also been mentioning that this consolidation should be considered healthy and overall bias would continue to be positive until higher-top higher-bottom formation on the daily chart is intact. However, we have been advising trading light in Nifty till the benchmark beaks out of this consolidation.

8710-8730 has been the supply area in this consolidation phase and crossover of the same is required for fresh upmove. 8845, the top made in April 2015, would be the next target if that happens.

34-DMA, which has now moved up to 8560 and immediate previous bottom on the daily chart placed at 8540, make 8560-8540 an important support area.