NIFTY FAILS TO CROSS 8970 HURDLE YET AGAIN; 8860 CONTINUES TO BE IMMEDIATE SUPPORT

NIFTY FAILS TO CROSS 8970 HURDLE YET AGAIN; 8860 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices fell 0.1%-0.3% amid rising geopolitical tension, prospects of higher interest rates in the US and the House Republicans legislation to repeal and replace Obamacare. Dow and S & P 500 recorded their first two-day losing streak since January.

The first components of a U.S.-deployed Terminal High-Altitude Area Defense (THAAD) anti-missile system arrived in South Korea. The deployment of the system drew strong rebuke from China.

The GOP health care proposal includes killing the requirement that most Americans must have health insurance or pay a fine, among other changes.

The U.S. trade deficit jumped in January to the highest level in nearly five years to $48.5 billion.

The yield on the benchmark 10-year Treasury notes rose to around 2.51%.

US crude fell 0.1% to $53.14 and Brent was down 0.2% at $55.92. American Petroleum Institute data showed that U.S. crude stocks rose 11.6 million barrels last week, more than five times analyst's forecasts.

In Europe, FTSE and CAC fell 0.2% and 0.4% respectively while DAX and Italy gained marginally. U.K. house price growth cooled to its weakest level since 2013. German industrial orders dropped by 7.4% in January, the biggest fall since 2009.

Japan's fourth-quarter gross domestic product was revised up to 1.2% from the preliminary figure of 1%, as capital expenditure grew at its fastest pace in three years.

AT HOME

After a flattish start, benchmark indices saw a gradual downward drift through the session to end with modest cuts. Sensex lost 49 points to settle at 29000 while Nifty finished at 8947, down 17 points. BSE mid-cap and small-cap indices however managed to end 0.14% and 0.03% higher. BSE Metal index tumbled 1.8%, becoming top loser among the sectoral indices, followed by 0.8% cut in Basic Materials index. Oil & Gas and Consumer Durable indices were the top gainers, up 0.4% each.

FIIs net bought stocks and index futures worth Rs 920 cr and 66 cr respectively but net sold stock futures worth Rs 1764 cr. DIIs were net sellers to the tune of Rs 1074 cr.

Rupee appreciated 5 paise to end at 66.67/$.

OUTLOOK

Today morning Asian markets are trading with cuts of upto 0.7% and SGX Nifty is suggesting about 15 points lower start for our market.

As we have been mentioning, 8970, the top made in September 2016, is the important resistance, a decisive crossover of which is required for a fresh upmove.

The benchmark, after touching a high of 8978 in the opening trade, slipped to end at 8947, failing to cross this hurdle once again.

Upon decisive crossover of 8970, next immediate target to eye would be 9119, the top made in March 2015. 8860, the bottom made last week, which also coincides with 20-DMA, continues to be immediate support.

Traders are advised to wait for the decisive breach of 8860-8970 range on either side for taking a fresh directional view on Nifty.