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.