NIFTY NEARLY ACHIEVES MAJOR 8970 TARGET; 8830 IS THE IMMEDIATE SUPPORT

NIFTY NEARLY ACHIEVES MAJOR 8970 TARGET; 8830 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow gained 0.2% while S & P 500 and Nasdaq fell 0.1% each yesterday after minutes from the Federal Reserve's previous meeting hinted that a rate hike coming "fairly soon."

Energy stocks lead decliners af US crude fell 1.4% to $53.59 a barrel.

Weekly mortgage applications fell 2% for the week ending Feb. 17 amid lackluster refinancing. Existing home sales rose 3.3% in January to a 10-year high.

Treasury yields fell with the 10-year yield around 2.41% after earlier hitting a near 2-week low of 2.391%. The 2-year yield held near 1.21%.

In Europe, FTSE, CAC and DAX gained 0.2%-0.4% but Italy and Spain tumbled 0.8% each. German Ifo business climate index for January rose to 111.0 and matched December's 33-month high. The 10-year German bund yield hit its lowest level in five weeks as geopolitical concerns remained.

AT HOME

After gaining about six tenth of a percent in the first half, Sensex and Nifty gave away nearly half of the gains in the second half to end higher by 0.36% and 0.2% respectively. Nevertheless, both the indices closed at their highest level since 8th September, 2016, marking a 5-1/2 month high. Sensex added 103 points to settle at 28865 while Nifty finished at 8927, up 19 points. BSE mid-cap and small-cap indices however lost 0.6% each. BSE Energy index soared 4.5%, becoming top gainer among the sectoral indices, followed by 1.8% rise in Oil & Gas index. IT index was the top loser, down 1.7%, followed by 1.4% each cut in Utilities, Consumer Durable and Teck indices.

FIIs net sold stocks and index futures worth Rs 259 cr and 272 cr respectively but net bought stock futures worth Rs 306 cr. DIIs were net buyers to the tune of Rs 918 cr.

Rupee depreciated 5 paise to end at 66.97/$.

Reliance Industries soared 11.2%, registering the biggest single-day gain in nearly eight years and also touching an eight-year high after Reliance Jio yesterday announced that it will end free data service and start charging its customers from 1 April.

OUTLOOK

Today morning Asian markets are trading flat to modestly lower and SGX Nifty is suggesting a marginally higher start for our market.

Just to recall, we had been working with a major target of 8970 after 8560, the 61.8% retracement level of the entire 8970-7893 fall, was taken out in late January. The benchmark touched a high of 8961 yesterday, nearly achieving this target and vindicating our view.

8970 is the top made in September 2016 and hence a major ceiling, a decisive crossover of which is required for a fresh upmove. While 9119, the top made in March 2015, would be the immediate target if that happens, eventual target of this near 2-year consolidation breakout would come to around 10000.

Meanwhile, immediate support on the hourly chart has moved up to 8830, which should serve as the stop-loss for existing longs.