OIL SOARS AFTER OPEC DEAL; NIFTY MOVES CLOSER TO 8260 TARGET

OIL SOARS AFTER OPEC DEAL; NIFTY MOVES CLOSER TO 8260 TARGET

WORLD MARKETS                             

Dow closed flat while S & P 500 and Nasdaq lost 0.3% and 1% yesterday as gains energy were offset by fall in utility stocks.

US crude soared 9.3% to $49.21 per barrel after OPEC agreed to cut production by approximately 1.2 million barrels per day, or about 4.5% of current production. This is the first output cut deal since 2008.

Data from ADP and Moody's analytics showed US private companies added 216,000 jobs in November, well above the expected 165,000. Consumer spending rose 0.3% in October, while personal income gained 0.6%, the best showing since April. The Chicago PMI index reading for November came in at 57.6, well above an October reading of 50.6. Pending home sales rose 0.1% month over month in October and 1.8% year over year, in line with expectations.

Dollar index rose about half a percent to 101.53, breaking four-day losing streak. US treasuries fell, with the two-year note yield rising to 1.11% and the benchmark 10-year note yield at 2.38%. Gold fell $17 to $1174 per ounce, marking a near 10-month low.

European markets gained 0.2%-2.2% with Italy on the top. Italy is scheduled to hold a referendum on Sunday in which citizens will vote in a referendum on whether to overhaul their national constitution. Eurozone flash inflation for November came in at 0.6%, meeting expectation.

AT HOME

Benchmark indices soared a percent yesterday, extending the winning streak to fourth straight day and closing at the highest level since 11th November. Sensex climbed 259 points to settle at 26653 while Nifty finished at 8224, up 82 points. BSE mid-cap and small-cap indices gained 1.1% and 1.3% respectively. All the BSE sectoral indices ended in green with Consumer Durable index and Bankex leading the tally, up 2.5% and 2.2% respectively.

FIIs net sold stocks worth Rs 434 cr but net bought index futures and stock futures worth Rs 659 cr and 371 cr respectively. DIIs were net buyers to the tune of Rs 677 cr.

Rupee appreciated 27 paise to end at 68.38/$.

India’s economy grew 7.3% in July to September, marginally quicker than the previous quarter’s 7.1%, but below the estimated 7.5% mark.

The fiscal deficit for the April-October period came in at Rs 4.2 lakh crore against Rs 4.1 lakh crore on a year on year basis. The deficit figure for the first seven months of this fiscal year was 79.3% of Rs 5.34 Lakh crore FY17 Budget target.

OUTLOOK

China's November manufacturing PMI has come in at 51.7, up from 51.2 in October. The Services PMI has edged up to 54.7 from 54.

Asian markets are trading with gains of 0.4%-1.8% with Nikkei leading the gains and SGX Nifty is suggesting a flattish start for our market.

After Nifty generated a "buy" on the hourly char by crossing the immediate hurdle of 8085, we have been working with upside targets of 8180, 8260 and 8340 which are the 38.2%, 50% and 61.8% respectively of the recent 8600-7916 fall.

The benchmark yesterday touched a high of 8234, nearly achieving the middle target of the three targets mentioned above. 8260 continues to be next target to eye above which 8340 would be the bigger hurdle as well as the milestone to watch.

Immediate support on the hourly chart has moved up to 8110, which should serve as the stop-loss for trading longs.

Auto companies will report November sales figures today.