NIFTY ACHIEVES 8180 TARGET; TRAIL STOP-LOSS TO 8060

NIFTY ACHIEVES 8180 TARGET; TRAIL STOP-LOSS TO 8060

WORLD MARKETS                             

US indices gained 0.1%-0.2% yesterday supported by gains in healthcare and real estate stocks while energy stocks fell tracking steep decline in oil ahead of OPEC meeting.

WTI and Brent crude tumbled 3.9% each to $45.38 and $46.38 a barrel respectively amid fresh uncertainties over an OPEC deal to reduce production levels

The second read on US third-quarter GDP came in at an annualized rate of 3.2%, above a previous reading of 2.9%. S&P Core Logic Case-Shiller index showed U.S. home prices gained 5.5% in September. The Consumer confidence index for November came in at 107.1, well above expectations.

Dollar index slipped about 0.3%. Treasuries gained with the two-year note yield trading at 1.099% and the benchmark 10-year yield around 2.302%. Gold fell $3 to $1189 per ounce.

European markets, except a 0.4% lower FTSE, gained 0.4%-2.1% with Italy on the top. Banking stocks gained following news that the European Central Bank stands ready to increase its purchase of Italian government bonds to control any market turbulence following Sunday's referendum. Basic resources stocks were the worst performers with a slide in metal prices.

AT HOME

After rising about nine tenth of a percent, benchmark indices gave away large part of the gains in the late noon tumble to end just modestly higher. Sensex added 44 points to settle at 26394 while Nifty finished at 8142, up 15 points. BSE mid-cap and small-cap indices gained half a percent each. BSE Auto and Telecom indices climbed 2.2% and 2% respectively, becoming top gainers among the sectoral indices while IT and FMCG indices were the top losers, down half a percent each.

FIIs net sold stocks worth Rs 715 cr but net bought index futures and stock futures worth Rs 615 cr and 833 cr respectively. DIIs were net buyers to the tune of Rs 534 cr.

Rupee appreciated 11 paise to end at 68.65/$.

The Lok Sabha yesterday passed the Taxation Laws (Second Amendment) Bill, which amends the Income-tax Act, 1961, and the Finance Act, 2016.

Rating agency Fitch lowered India's GDP growth forecast for this fiscal to 6.9% from 7.4%, saying there will be "temporary disruptions" to economic activity post demonetisation.

OUTLOOK

Today morning, except a modestly lower Shanghai, other Asian markets are trading with gains of upto 0.9% and SGX Nifty is suggesting about 15 points higher start for our market.

In yesterday's report we had reiterated the view that Nifty continues to be in the buy mode on the hourly chart and that 8180, the 38.2% retracement level of the recent 8600-7916 fall, is the first upside target to eye above which 8260 and 8340, the 50% and 61.8% retracement levels of the aforementioned upmove, would be the subsequent levels to watch.

The benchmark touched a high of 8197 before closing at 8142, achieving the first target mentioned above.

8197, the top made yesterday, is the immediate hurdle above which 8260, as mentioned above, would be the next target to eye.

Immediate support on the hourly chart has moved up to 8060, with the stop-loss of which trading longs can be held on to.

India's Q2 FY17 GDP figure will be released today and is expected to show a growth of 7.5%.

Ministers from the 14-nation cartel, OPEC, are slated to meet in Vienna today to announce a decision on output curbs proposed in September. In September, OPEC had outlined a deal to cut output by approximately 1 million barrels per day and failure to reach a deal for production cuts could see oil prices decline further. 

8020 IS THE IMMEDIATE SUPPORT; 8180, 8260 UPSIDE TARGETS

8020 IS THE IMMEDIATE SUPPORT; 8180, 8260 UPSIDE TARGETS

WORLD MARKETS                             

US indices fell 0.3%-0.6% yesterday with Dow and S & P 500 breaking four-day winning streak. The Russell 2000, which is composed of small-cap stocks, closed about 1.3% lower, snapping a 15-day winning streak, its longest in 20 years.

Dollar index eased to 101.16 from 101.50. U.S. Treasuries rose with the two-year note yield falling to 1.107% and the benchmark 10-year yield trading lower at 2.314%. Gold rose $12 to $1191 per ounce.

US crude climbed 2.2% to $47.08 a barrel and Brent added 2.1% to $48.24 after the Iraqi oil minister said Iraq will cooperate with other OPEC members to reach a deal.

European markets lost 0.6%-1.8% with Italy leading the losses on worries that the upcoming referendum in Italy could potentially lead to the fall of the Italian government and raise possible concerns over the recapitalization of the banking system.

AT HOME

After starting about half a percent lower, benchmark indices recouped all the losses and more through the choppy session to end with modest gains. Sensex settled at 26350, up 34 points while Nifty added 13 points to finish at 8127. BSE mid-cap and small-cap indices gained 1% and 0.7% respectively. BSE Telecom index soared 4%, becoming top gainer among the sectoral indices, followed by 1.9% rise in Realty index. Consumer Durable index and Bankex were the top losers, giving away 1.2% each.

FIIs net sold stocks and index futures worth Rs 1436 cr and 123 cr respectively but net bought stock futures worth Rs 753 cr. DIIs were net buyers to the tune of Rs 1234 cr.

Rupee depreciated 30 paise to end at 68.76/$.

Government yesterday moved “The Taxation Laws (Second Amendment) Bill, 2016" in the Parliament to allow for the taxation of unaccounted money declared post demonatisation. Proposals include levy a total tax, penalty and surcharge of 50% on the amount deposited post demonetisation while higher taxes and stiffer penalty of up to 85% await those who don't disclose but are caught.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that Nifty had generated "Buy" on hourly chart by crossing immediate hurdle placed at 8085 and that 8180, the 38.2% retracement level of the recent 8600-7916 fall, is the first upside target to eye above which 8260 and 8340, the 50% and 61.8% retracement levels of the aforementioned upmove, would be the subsequent levels to watch. We had also advised holding on to trading longs with the stop-loss of 8000.

The benchmark, after touching a low of 8066 in the opening session, rebounded to end at 8126.

8180 continues to be first upside target to eye above which 8260 and 8340, as mentioned above would be the subsequent milestones to watch.

Immediate support on the hourly chart has moved up to 8020, with the stop-loss of which trading longs should be held on to.

Tata Power will report its quarterly earnings today.

STAY LONG WITH THE STOP-LOSS OF 8000

STAY LONG WITH THE STOP-LOSS OF 8000

WORLD MARKETS                             

US indices gained about four tenth of a percent on Friday to close at fresh record high.

U.S. trade deficit totaled $62 billion in October. The November read on the IHS Markit non-manufacturing index came in at 54.7, marginally lower than the October read of 54.8.

US oil fell 3.1% to $46.48 and Brent lost 3.6% to $47.25 a barrel as Saudi Arabia announced it will not attend talks on Monday with non-OPEC producers to discuss supply cuts.

US 10-year note yield held at 2.372% while the dollar index fell 0.2%. Gold fell $11 to $1178 per ounce.

European markets ended with modest gains.

For the week US indices added almost 1.5% each, extending the winning streak to third straight week. In Europe FTSE and CAC climbed 1% each while DAX was up 0.3%. In Asian, Nikkei and Shanghai soared 2.3% and 2.2% respectively while Hang Seng rose 1%.

AT HOME

After a modestly higher start, Sensex and Nifty kept on moving higher through the session to end with mammoth gains of 1.8% and 1.9% respectively, marking the biggest daily gain since 18 October and 25th May respectively. Sensex soared 456 point to settle at 26316 while Nifty finished at 8114, up 150 points.  BSE mid-cap and small-cap indices added 1.3% and 2% respectively. All the BSE sectoral indices ended in green with IT and Teck indices leading the tally, up 4.7% and 3.8% respectively.

FIIs net sold stocks worth Rs 373 cr but net bought inex futures and stock futures worth Rs 638 cr and 1034 cr respectively. DIIs were net buyers to the tune of Rs 998 cr.

Rupee appreciated 27 paise to end at 68.46/$.

For the week, Sensex and Nifty gained 0.6% and 0.5% respectively, breaking four-week losing streak.

The government released the revised draft Goods & Services Tax (GST) Compensation Law for public as well as the revised IGST Law after incorporating suggestions from industries. Government officials have said that these bills will tabled in the Parliament during 5-9 December.

With a move to managing the excess liquidity in the system banking regulator Reserve Bank of India announced that it would absorb a part of this extra cash by applying an incremental cash reserve ratio (CRR) as a purely temporary measure. On the increase in NDTL between September 16, 2016 and November 11, 2016, scheduled banks shall maintain an incremental CRR of 100%, effective the fortnight beginning November 26, 2016. This move is expected to suck out around Rs 3.3 lac cr from the banking system.

OUTLOOK

Today morning, except a half a percent lower Nikkei, other Asian markets are trading with gains of 0.3%-0.8% but SGX Nifty is suggesting about 40 points lower start for our market.

In Friday's report we had reiterated the view that 8085 continues to be immediate hurdle, a crossover of which would generate a buy ont he hourly chart and would pave the way for the further upmove.

The benchmark crossed this hurdle on Friday and touched a high of 8122 before closing at 8114 but is set to open lower today.

8180 the 38.2% retracement level of the recent 8600-7916 fall, is the first upside target to eye above which 8260 and 8340, the 50% and 61.8% retracement levels of the aforementioned upmove, would be the subsequent levels to watch.

Immediate support on the hourly chart is placed around 8000, with the stop-loss of which trading longs should be held on to.

NIFTY SHEDS 7.5% IN NOVEMBER SERIES; 7900-8085 CONTINUES TO BE IMMEDIATE RANGE

NIFTY SHEDS 7.5% IN NOVEMBER SERIES; 7900-8085 CONTINUES TO BE IMMEDIATE RANGE

WORLD MARKETS                             

US markets were shut yesterday for the Thanksgiving holiday.

European markets, except a 0.2% lower Italy, gained upto 0.3%. The German Ifo Business Climate Index stood at 110.4 points in November, unchanged from the previous month but below forecasts.

Dollar index ended almost flat at 101.69.

WTI and Brent crude rose 0.1% each to $47.92 and $49 a barrel respectively.

AT HOME

After a choppy session, which is customary for an expiry day, benchmark indices ended with cuts of about eight tenth of a percent, breaking the two-day winning streak. Sensex lost 192 points to settle at 25860 while Nifty finished at 7966, down 68 points. BSE mid-cap and small-cap indices fell 0.1% each. BSE Bankex and Auto indices tumbled 1.4% and 1.3% respectively, becoming top gainers among the sectoral indices while IT and Metal indices added 1.2% each, becoming top gainers.

FIIs net sold stocks, index futures and stock futures worth Rs 2010 cr, 1563 cr and 1153 cr respectively. DIIs were net buyers to the tune of Rs 1648 cr.

Rupee depreciated 17 paise to end at 68.73/$.

For the November derivative series, Nifty lost 7.5%, marking the biggest loss in a series since August 2013.

OUTLOOK

Today morning Asian markets are trading with gains of upto 0.7% and SGX Nifty is suggesting about 20 points higher start for our market.

As we have been mentioning for couple of days, 7900, the 50% retracement level of the entire 6825-8970 upmove, is the immediate support to eye, upon breach of which next meaningful  to eye would be 7650, the 61.8% retracement level.

8085 continues to be immediate hurdle, a crossover would confirm a "buy" on hourly chart after a long time and would pave the way for the further upmove.

7900-8085 CONTINUE TO BE IMMEDIATE BOUNDARIES

7900-8085 CONTINUE TO BE IMMEDIATE BOUNDARIES

WORLD MARKETS                             

Dow and S & P 500 gained 0.3% and 0.1% respectively Nasdaq lost 0.1% digested a number of economic data, including minutes from the Federal Reserve's November meeting.

Minutes backed the consensus view that the central bank is poised to raise rates in December. Weekly jobless claims increased 18,000 to a seasonally adjusted 251,000 for the week ended Nov. 19. That said, claims have now been below 300,000, a threshold associated with a healthy labor market, for 90 straight weeks. U.S. durable goods increased 4.8% in October, well above a 1.5% consensus estimate.  IHS Markit manufacturing index for November showed a slight increase to 53.9 from 53.4 in October. New home sales for October fell 1.9%, while consumer sentiment came in at 93.8, above a 91.6 estimate.

Dollar index soared to 101.71 from previous day's 101 level, touching a fresh 13 1/2 year high. Gold fell $22 to $1189 per ounce, marking a nine-month low.

US crude rose 0.4% to $48.22 and Brent gained 0.3% to $49.27 after data from the U.S. Energy Information Administration showed crude inventories fell 1.3 million barrels in the week to Nov. 18, compared with market expectations for a build of 671,000 barrels.

European markets, except a marginally higher Italy, lost upto 0.5%. Euro zone composite purchasing managers' index (PMI) for November came in at 54.1, the highest since December 2015 and up from 53.3 in October. The U.K. government cut its growth forecast for 2017 from 2.2% to 1.4% and for 2018 from 2.1% to 1.7%.

AT HOME

Benchmark indices added four tenth of a percent yesterday, extending the winning streak to second straight day. Sensex settled at 26052, up 91 points while Nifty rose 31 points to finish at 8033. BSE mid-cap and small-cap indices climbed 1.2% and 1.5% respectively. Except a marginally lower Finance and Telecom indices, all the BSE sectoral indices closed higher, with Realty and Metal indices leading the tally, up 3.4% and 2.3% respectively.

FIIs net sold stocks and index futures worth Rs 1023 cr and 55 cr respectively but net bought stock futures worth Rs 1458 cr. DIIs were net buyers to the tune of Rs 1255 cr.

Rupee tumbled 31 paise to close at fresh nine-month low of 68.56/$.

With several states suggesting changes in the model GST and compensation laws, the GST Council meeting scheduled for November 25 has been postponed to December 2-3. The officers' committee of both the Centre and states, however, will meet on November 25 to finalise the three draft legislations -- CGST, IGST and compensation law. These will be placed in public domain for stakeholders' comments. 

SBI cut bulk deposit rates by 1.25%-1.9%.

OUTLOOK

Today morning Nikkei, after yesterday’s break, has opened higher by about a percent but other Asian markets are trading with cuts of upto 0.8% and SGX Nifty is suggesting about 40 points lower start for our market.

In yesterday's report we had reiterated the view that 7900, the 50% retracement level of the 6825-8970 upmove, continues to be immediate support to eye, upon breach of which, next meaningful support will come only at 7650, which is the 61.8% retracement level of this upmove. We had also said that the immediate resistance on the hourly chat has moved lower to 8085, a crossover of which is required for the fresh upmove.

Yesterday, the benchmark, after touching a high of 8055, retreated to end at 8033 and is set to open around 8000 today.

8085 continues to be immediate hurdle, a crossover of which is required to generate a buy on the hourly chart which in turn would pave the way for the fresh upmove.

Traders should keep a stop-loss of 8085 for short positions.

U.S. markets will be closed today for the Thanksgiving holiday and open for a half-day on Friday.

NIFTY REBOUNDS FROM 7900 SUPPORT; 8085 IS THE IMMEDIATE HURDLE

NIFTY REBOUNDS FROM 7900 SUPPORT; 8085 IS THE IMMEDIATE HURDLE

WORLD MARKETS                             

US indices gained 0.2%-0.4%, hitting fresh record highs, as investors digested housing data and kept an eye on President-elect Donald Trump's policy agenda. S & P 500 and Dow scaled 2200 and 19000 mark for the first time ever.

On Monday, Trump expanded on his policy agenda, which includes withdrawing from the Trans-Pacific Partnership (TPP). Trump described the TPP as "a potential disaster" for the U.S., adding "we will negotiate fair bilateral trade deals that bring jobs and industry back onto American shores."

Existing home sales rose to their highest annual rate since February 2007.

Dollar index inched up to 101 from 100.88. The two-year note yield held around 1.08% and the benchmark 10-year yield held near 2.31%.

US crude fell 0.4% to $48.03 a barrel while Brent gained 0.4% to $49.12.

European markets added 0.3%-1.4% with Basic Resources stocks outperforming.

AT HOME

After opening higher by nearly a percent, Sensex and Nifty gave away nearly all the gains in the first half, but recouped most of the lost ground in the later half to end higher by 0.8% and 0.9% respectively. For Sensex, this was the first positive close after six consecutive negative days while Nifty saw green after 3 red days. Sensex settled at 25961, up 196 points while Nifty added 73 points to finish at 8002. BSE mid-cap and small-cap indices gained 1.4% and 1.2% respectively. BSE Metal and Realty indices climbed 2.7% and 2.5% respectively, becoming top gainers among the sectoral indices while Capital Goods and Power indices lost 0.7% and 0.4% respectively.

FIIs net sold stocks worth Rs 693 cr but net bought index futures and stock futures worth Rs 371 cr and 1397 cr respectively. DIIs were net buyers to the tune of Rs 1075 cr.

Rupee depreciated 10 paise to end at 68.25/$.

L & T reported better-than-expected earnings. Revenue rose 8.2% y-o-y to Rs 25011 cr. Net profit soared 84% to Rs 1435 cr but was boosted by one time gain of Rs 402 cr. EBITDA (earnings before interest, tax, depreciation and amortization) grew by 7.9 percent to Rs 2,298 crore and margin was unchanged 9.2%. Consolidated order inflow increased 11% to Rs 31119 cr. With this, consolidated order book of the group stood at Rs 2.51 lakh crore, higher by 4% y-o-y. The company maintained its order inflow guidance of 15% and revenue growth forecat of 12-15% for the current financial year.

OUTLOOK

Today morning Asian markets are trading with gains of upto half a percent and SGX Nifty is suggesting about 50 points higher start for our market.

In yesterday's report we had said that 7900, the 50% retracement level of the entire 6825-8970 upmove, continues to be immediate support to eye, upon breach of which 7650, the 61.8% retracement level of this upmove, would be the next meaningful downside target. We had also said that the immediate resistance on the hourly chart has moved lower to 8100, a crossover of which is required to generate a buy on the hourly chart and pave the way for further upmove.

The benchmark, after touching a high of 8018 in the opening trade, reversed to touch a low of 7938 but bounced back again to end at 8007. A higher opening today would take it above 8050 mark today.

7900 continues to be immediate support on the way down. Immediate resistance is placed around 8085, a crossover of which would generate a buy on the hourly chart. 8180, the 38.2% retracement level of the recent 8600-7916 fall, would be the immediate upside target in that case.  Traders should exit short and go long if Nifty takes out and sustains above 8085.

NIFTY NEARLY ACHIEVES 7900 TARGET; 8100 IS THE IMMEDIATE HURDLE

NIFTY NEARLY ACHIEVES 7900 TARGET; 8100 IS THE IMMEDIATE HURDLE

WORLD MARKETS                             

US indices gained 0.5%-0.9% yesterday to close at record highs on the back of higher oil prices.

US crude soared 4% to $47.49 a barrel and Brent added 4.4% to $48.90, both touching their highest level in three weeks,  as OPEC members seemed closer to a deal to cut output following comments from Russian President Vladimir Putin.

Dollar index eased 0.3% to 100.9. US 10-year treasury yield fell to 2.33%.

European markets gained upto 0.6%. ECB President Draghi, in his appearance before the European Parliament defended the bank's actions to date and suggested that the ECB must continue with its current level of monetary support in order to help inflation grow.

AT HOME

Market mayhem continued as Sensex and Nifty plunged 1.5% and 1.8% respectively in today's trade to close at the lowest level since 24th May, 2016. Sensex lost 385 points to settle at 25765 while Nifty finished at 7929, down 145 points. BSE mid-cap and small-cap indices tumbled 2.8% and 3.2% respectively. All the BSE sectoral indices ended in red with Realty index leading the losses, down 4.7%, followed by 3.3% each cut in Metal and Auto indices.

FIIs net sold stocks worth Rs 1311 cr but net bought index futures and stock futures worth Rs 1170 cr and 684 cr respectively. DIIs were net buyers to the tune of Rs 1211 cr.

Rupee depreciated 3 paise to end at 68.16/$, the weakest finish since Feb 29.

Bringing some relief for banks and non-banking finance companies (NBFCs) from demonetisation, the Reserve Bank has relaxed certain asset classification and provisioning norms in certain cases. RBI has decided to allow banks 60 more days for recognition of loans as standard in certain cases. The revised norm is applicable for loans payable between November 1 and December 31.  Small borrowers who have been unable to pay back loans will be given additional two months to pay back dues to banks.

OUTLOOK

Today morning, Nikkei is trading marginally lower owing to a 6.9 magnitude earthquake that struck off the coast of Fukushima prefecture. Other Asian markets are trading with gains of upto 0.7% and SGX Nifty is suggesting about 40 points higher start for our market.

For past couple of days we had been mentioning that 8000, the bottom made on 9th November, also coincided with 34-month moving average, and hence was an important support to eye and that upon breach of 8000, next support levels to eye would be 7900 and 7650, where the 50% and 61.8% retracement levels of 6825-8970 upmove are placed.

The benchmark broke 8000 support yesterday and plunged all the way to 7916 before closing at 7929.

7900 continues to be immediate support to eye upon breach of which 7650, as mentioned above, would be the next meaningful downside target.

Immediate resistance on the hourly chart has moved lower to 8100, a crossover of which is required to generate a buy on the hourly chart and pave the way for further upmove. 8260 and 8340, the 50% and 61.8% retracement levels of the recent 8600-7916 fall, would be the upside targets if that happens.

L&T will report its quarterly earnings today.

8000 CONTINUES TO BE IMPORTANT SUPPORT; 8240 IMMEDIATE HURDLE

8000 CONTINUES TO BE IMPORTANT SUPPORT; 8240 IMMEDIATE HURDLE

WORLD MARKETS                             

US indices fell a fifth of a percent, amidst rising dollar and fall in oil and digesting remarks of Fed officials.

Dollar index rose a third of a percent to 101.34, extending the winning streak to eight straight day and closing at fresh 13-1/2 year high. The benchmark 10-year U.S. Treasury yield rose to near 2.35%, the highest in nearly a year and half and the 2-year yield was around 1.07%.

Kansas City Fed President said the U.S. economy would benefit from the Federal Reserve raising rates sooner rather than later. St. Louis Fed President James Bullard said he is leaning towards supporting a rate hike next month and argued that the real question now is the Fed's rate path in 2017.

US oil fell 0.6% to $45.69 a barrel after Baker Hughes said U.S. oil rigs increased by 19 to 471. Brent rose 37 cents or 0.8% to $46.86.

Gold fell $8 to $1209 per once, marking a 5-1/2 month low.

The Chinese Yuan hit a fresh eight-year low.

European markets lost 0.2%-1.8%. Basic resource stocks fell sharply on the back of the stronger dollar, which makes dollar-denominated commodities more expensive for buyers paying in other currencies.

For the week, Nasdaq and S & P 500 added 1.6% and 0.8% respectively while Dow inched up 0.1%. In Europe, FTSE and CAC gained 0.7% and 0.3% respectively but DAX ended marginally in the red. Among Asian markets, Nikkei soared 3.4%, but Hang Seng and Shanghai lost 0.8% and 0.1% respectively.

AT HOME

Benchmark indices, after rising more than half a percent, gave away more than they had gained in the late noon plunge to end with modest cuts. Sensex lost 77 points to settle at 26150 while Nifty finished at 8074, down 6 points. BSE mid-cap and small-cap indices however, gained 0.6% and 0.2% respectively. BSE Oil & Gas index rose 1.4%, becoming top gainer among the sectoral indices, followed by 1.3% each rise in Healthcare and Realty indices.

FIIs net sold stocks and index futures worth Rs 926 cr and 597 cr respectively but net bought stock futures worth Rs 843 cr. DIIs were net buyers to the tune of Rs 1143 cr.

Rupee depreciated 31 paise to end at 68.13/$, the weakest level in 9 months.

For the week, Sensex and Nifty lost 2.5% and 2.7% respectively, extending the losing streak to fourth week.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting a flattish start for our market.

Readers would recall that after Nifty broke the 61.8% retracement level of the recent 8000-8600 pullback placed at 8230, we have been working with the possibility of the retest of 8000 bottom.

Nifty on Friday touched a low of 8048, coming very close to 8000 bottom and vindicating our view.

8000, the 34-month moving average, continues to be important support to eye. While 7900, the 50% retracement level of the entire 6825-8970 upmove would be the next support below 8000, one would have to be prepared for 7650, the 61.8% retracement level of the aforementioned  upmove.

Immediate resistance on the hourly chart is placed around 8240, a crossover of which would generate a buy on the hourly chart and would pave the way for further upmove. 8330, where 34-week moving average is placed, would be the next target above that.

Traders are advised to wait for the breach of 8000-8240 range on either side for taking a fresh directional view on Nifty.

NIFTY MOVES CLOSER TO 8000 SUPPORT; 8250 IS THE IMMEDIATE HURDLE

NIFTY MOVES CLOSER TO 8000 SUPPORT; 8250 IS THE IMMEDIATE HURDLE

WORLD MARKETS                             

US indices gained 0.2%-0.7% on the back of remarks from Fed Chair Janet Yellen and upbeat economic data.

Housing starts soared more than 25% in October, while weekly jobless claims dropped to their lowest level since November 1973. October CPI rose 0.4%, in line with expectations.

Yellen testified to Congress where she said in prepared remarks that a rate hike could be "appropriate relatively soon," and added there were dangers to waiting too long to tighten monetary policy. She added she would not step down from her position as the head of the Federal Reserve until the end of her term.

U.S. Treasury yields rose with the two-year note yield near 1.03% and the benchmark 10-year yield around 2.28%.

US oil fell 0.33% to $45.42 a barrel.

European markets, except a flat Italy, gained 0.2%-0.9%.

AT HOME

After gaining about half a percent in the initial trade, Sensex and Nifty tumbled just under a percent from the top of the day to end lower by 0.3% and 0.4% respectively to end at the lowest level since late May. Sensex settled at 26228, down 71 points while Nifty lost 32 points to finish at 8080. BSE mid-cap and small-cap indices fell 0.4% and 0.6% respectively. BSE Telecom and Teck indices tumbled 2.4% and 1.7% respectively, becoming top losers among the sectoral indices while Utilities and Power indices were the top gainers, up 1.1% and 0.9% respectively.

FIIs net sold stocks worth Rs 984 cr but net bought index futures and stock futures worth Rs 345 cr and 200 cr respectively. DIIs were net buyers to the tune of Rs 1144 cr.

Rupee appreciated 13 paise to end at 67.82/$.

OUTLOOK

Today morning, except a 0.7% higher Nikkei, other Asian markets are trading with modest cuts and SGX Nifty is suggesting about 20 points lower start for our market.

At the risk of repeating, we have been working with the possibility of the retest of the 8000 bottom after 8230, the 61.8% retracement level of the 8000-8600 pullback was breached. The benchmark yesterday closed at 8080 and a lower close today would take it closer to 8000 mark.

8000, as we have been mentioning, is also where 34-month moving average is placed and hence is a crucial support to eye. In case of 8000 not holding, 7900 and 7650, 50% and 61.8% retracement levels of the 6825-8970 upmove, would be the next downside targets to eye.

Immediate resistance on the hourly chart has moved lower to 8250, a crossover of which would generate a buy on the hourly chart and would pave the way for the further upmove.

8315 IS THE IMMEDIATE HURDLE; 8000 CRUCIAL SUPPORT

8315 IS THE IMMEDIATE HURDLE; 8000 CRUCIAL SUPPORT

WORLD MARKETS                             

Dow and S & P 500 fell 0.3% and 0.2% respectively while Nasdaq rose 0.4% yesterday. This was the first negative close for the Dow after seven consecutive up days.

Dollar index soared to its highest level since April 2003 to close at 100.30.

October read on the U.S. producer price index came in unchanged, versus an expected increase of 0.3%. Industrial production for October was also unchanged. Mortgage applications fell 9% amid the sharp increase in interest rates. The Home Builders/Wells Fargo Housing Market index showed sentiment held steady.

US oil settled 24 cents lower at $45.57 per barrel after the U.S. Energy Information Administration said crude inventory climbed by 5.3 million barrels last week, compared to a Reuters poll of analysts that had forecast a 1.5 million barrel-build. Oil had initially surged a percent following comments from Russia's energy minister that Russia was ready to support OPEC's decision on an oil output freeze and saw a big chance that terms could be agreed in time for the oil producers' group meeting at the end of the month.

European markets lost 0.6%-0.8%. U.K. unemployment rate fell to 4.8% in the third quarter of the year, versus 4.9% in the previous three months, to hit its lowest level in over a decade.

AT HOME

After gaining about a percent in the first half, benchmark indices gave away all the gains in the second half to end near zero line. Sensex settled at 26299, down 6 points while Nifty added 3 points to finish at 8112. BSE Mid-cap and small-cap indices gained 0.6% and 0.05% respectively. BSE IT and Teck indices climbed 1.8% each, becoming top gainers among the sectoral indices while Consumer Durable and Healthcare indices were the top losers, down 2% and 1.3% respectively.

FIIs net sold stocks worth Rs 1957 cr but net bought index futures and stock futures worth Rs 94 cr and 1019 cr respectively. DIIs were net buyers to the tune of Rs 2344 cr.

Rupee depreciated 20 paise to end at 67.94/$.

Winter session of Parliament began on Wednesday. The Lok Sabha was adjourned for the day after Speaker Sumitra Mahajan read out the obituaries of former members of Parliament. The debate over demonetisation got under way in the Rajya Sabha where a combative and united Opposition took on a rather firm government on the issue of currency demonetisation. The debate will continue on Thursday as well, with the Opposition demanding that Prime Minister Narendra Modi respond on the issue.

NASSCOM cut FY17 constant currency growth guidance for the industry to 8-10% from the earlier 10-12%.

Moody's Investors Service affirmed India's sovereign rating at 'Baa3' with a positive outlook, saying it expects policymakers to continue reforms to achieve balanced growth and reduce the government's debt load.

OUTLOOK

Today morning, Asian markets are trading with modest cuts and SGX Nifty is suggesting a flattish start for our market.

As we have been mentioning for last couple of days, 8000, the bottom made on 9th November, also coincides with the 34-month moving average and hence is a crucial support to eye. 7900 and 7650, 50% and 61.8% retracement levels of the 6825-8970 upmove, would be the next downside targets if 8000 does not hold.

Immediate resistance on the hourly chart has moved lower to 8315, upon crossover of which 8600 would be the major hurdle to eye.

8000 CONTINUES TO BE CRUCIAL SUPPORT; 8385 IMMEDIATE HURDLE

8000 CONTINUES TO BE CRUCIAL SUPPORT; 8385 IMMEDIATE HURDLE

WORLD MARKETS                             

US indices gained between 0.3%-1.1% as energy stocks rallied sharply and technology rebounded after a post-election sell-off. Dow extended the winning streak to seventh day and notched a new all-time closing high.

US crude rose 5.8% to $45.81 per barrel amid renewed hopes that OPEC would agree to a production cut. Brent settled at $46.98, up 5.7%.

US retail sales rose 0.8% in October while import prices rose 0.5%, both beating expectations. The November read on the New York manufacturing index also came in above estimates.

Goldman Sachs raised its third-quarter and fourth-quarter US GDP estimates by two tenths each, to 3.2% and 2.6%, respectively.

European markets gained 0.3%-0.6%. Euro zone third-quarter gross domestic product rose 1.6% year-on-year, and 0.3% quarter-on-quarter.

AT HOME

New week began on a weak note as Sensex and Nifty nosedived 1.9% and 2.3% respectively to close at the lowest level since 25th May and 27th June respectively. Sensex lost 514 points to settle at 26305 and Nifty finished at 8108, down 188 points. BSE mid-cap and small-cap indices fell 3.9% and 4.7% respectively. Except a 0.3% higher IT index, all the BSE sectoral indices ended in red with Basic Material index leading the tally, down 5.7%, followed by 5.1% each cut in Realty and Auto indices.

FIIs net sold stocks, index futures and stock futures worth Rs 2354 cr, 1356 cr and 1013 cr respectively. DIIs were net sellers to the tune of Rs 105 cr.

Rupee depreciated 49 paise to end at $67.74.

India’s wholesale inflation rose to 3.39% in October year-on-year, marginally lower than the previous month’s 3.57%. Retail inflation fell to a 14-month low of 4.20% in October, down from 4.39% in September.

India's trade deficit in October widened to USD 10.16 billion compared with USD 8.34 billion in the previous month as gold imports more than doubled to USD 3.5 billion from a year ago. Merchandise exports grew 9.6% year-on-year to USD 23.5 billion, while imports expanded 8.11% to USD 33.67 billion.

Oil marketing companies cut petrol and diesel price by Rs 1.46 and Rs 1.53 per litre respectively.

OUTLOOK

Today morning, except a marginally lower Shanghai, other Asian markets are trading with gains of upto 0.9% with Nikkei on the top. SGX Nifty is suggesting bout 70 points higher start for our market.

In yesterday's report we had mentioned that 8230, the 61.8% retracement level of the recent 8000-8600 pullback, would be the immediate support to eye, a sustained trading below which would open up the possibility of the retest of 8000 bottom.

The benchmark broke 8230 support in the initial trade itself and plunged all the way to 8093 before closing at 8108.

As mentioned in yesterday's report, 8000 which coincides with 34-month moving average, continues to be a crucial support to eye. Immediate resistance on the hourly chart has moved lower to 8385 above which 8600 would be the bigger hurdle to eye.

Winter session of the Parliament starts today and promises to be a stormy one owing to issues related to demonetization, OROP and surgical strike across LOC.

8000 MAJOR SUPPORT BELOW 8230; 8460 IMMEDIATE HURDLE

8000 MAJOR SUPPORT BELOW 8230; 8460 IMMEDIATE HURDLE

WORLD MARKETS                             

Dow gained 0.1%, S & P 500 ended flat while Nasdaq lost 0.4% yesterday. Dow gained for the sixth straight day and hit a new-all time high. Financials gained the most while IT was the top loser. Last week, Dow soared 5.4%, marking the best weekly gain since 2011. S & P 500 and Nasdaq climbed 3.8% each, their highest weekly gains since 2013 and February, respectively.

Following Trump's victory, markets are looking forward to his economic policies, which could lead to higher infrastructure spending and less regulation within financials.

Meanwhile, in an interview President elect Trump urged his supporters to stop harassing minority groups "because I'm going to bring this country together." In the same interview, however, Trump said he would deport millions of illegal immigrants.

Treasury yield continued to edge higher. Two-year yield traded at 0.996% while the benchmark 10-year yield gained around 10 bps to 2.2428%, hitting highest level since Dec 31, 2015. US Dollar index surged 1% to 100.03, an eleven-month high. Euro fell 1.1% to $1.073 and the yen fell 1.5% to $108.41.

US oil fell 0.2% to $43.32. Gold fell $3 to $1222 per ounce.

European markets, except a 0.8% lower Italy, gained 0.2%-0.4%. Higher bond yields and the prospect of an interest rate rise helped the European banking and financial services sectors.

Economic data out of China were mixed. China's fixed-asset investment rose 8.3% in the January-to-October period, beating market expectations, while October industrial output and retail sales growth missed forecasts.

AT HOME

On Friday, after a gap down opening, benchmark indices extended the fall through the session to end with deep cuts of more than two and a half percent and closing at the lowest level since June end. Sensex sank 699 points to settle at 26819 while Nifty finished at 8296, down 229 points. BSE mid-cap and small-cap indices nosedived 3.6% and 3.4% respectively. All the BSE sectoral indices ended in red with Auto and Consumer Discretionary Goods indices leading the tally, down 4.5% and 4.3% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 1493 cr, 1020 cr and 1708 cr respectively. DIIs were net buyers to the tune of Rs 65 cr.

Rupee depreciated 62 paise to end at 67.25/$.

For the week, Sensex and Nifty lost 1.7% and 1.6% respectively, extending the losing streak to third straight week.

SBI posted a net profit r Rs 2538 for September quarter, down 35% y-o-y. NII rose 1.3% to Rs 14437 cr. Gross NPA rose to 7.14% from 6.94% and net NPA rose to 4.19% from 4.05% q-o-q.

M & M reported a 27% jump in its standalone net profit at Rs 1,163 crore. Revenue stood at Rs 11364 cr, up 15.6%.

Tata Motors' consolidated revenues for the second quarter rose 7% y-o-y to Rs 67,999.7 crore, EBIT (earnings before interest and tax) stood at Rs 6,282 crore while the company swung to a profit of Rs 848 crore, compared to a Rs 1,740 crore loss last year. Revenue was slightly ahead of analysts' estimate but EBIT and profit fell short of estimates.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes. SGX Nifty is trading around 8250, which is down about 75 points compared to Friday's close of Nifty futures.

Readers would recall that we have been cautious on Nifty for last two months or so owing to steep six-month run up seen between March-August after which the benchmark was very close to 9119 top made in last March. After 8500, the bottom of the two-month consolidation phase was broken, we were working with targets of 8300 and 8150, where 8300 was the 34-week moving average and 8150 was the 38.2% retracement level of the entire 6825-8970 upmove.

The benchmark achieved both the above targets and went further to touch the 34-month moving average placed at 8000.

8000, being 34-month average, continues to be crucial support to eye. Before that 8230, the 61.8% retracement level of the recent 8000-8600 pullback, would be the immediate support to eye. A sustained trading below 8230 would open up the possibility of the retest of 8000 bottom.

On the way up, 8460 is the immediate hurdle on the hourly chart above which 8600 would be the major resistance to eye.