NIFTY ON TRACK TO ACHIEVE 10070 TARGET; TRAIL STOP-LOSS TO 9940

NIFTY ON TRACK TO ACHIEVE 10070 TARGET; TRAIL STOP-LOSS TO 9940

WORLD MARKETS                             

S & P 500 ended little changed while Dow and Nasdaq gained 0.4% and 0.2% respectively on the back of strong earnings and after digesting Fed meeting outcome.

Fed, as was widely expected, left interest rate unchanged. The post meeting statement however noted that normalization of the balance sheet would be implemented "relatively soon". This was a slight tweak compared to the Fed's use of "this year" after the June meeting. The central bank also said, however, inflation remains below its 2% target.

The dollar sold off around 0.7%to 93.40 in reaction to the statement. 10-year treasury yield also fell to 2.29%.  Two-year yield held around 1.363%.

Boeing, Coca-Cola and Ford posted better-than-expected quarterly results.

WTI crude rose 1.8% to $48.75 a barrel after the Energy Information Administration reported a crude drawdown of 7.2 million barrels.

European markets gained 0.2%-0.6%. The U.K. economy grew 0.3% during the second quarter, up from 0.2% in the first quarter.

AT HOME

It was yet another historic day as benchmark indices touched a fresh record high and Nifty closed above the 10000 mark for the first time ever. Nifty finished at 10021, up 56 points while Sensex added 154 points to settle at 32382. BSE mid-cap and small-cap indices gained 0.2% and 0.3% respectively. Except 0.4% and 0.2% lower Telecom and IT indices respectively, all the BSE sectoral indices ended in green with Metal index leading the tally, up 1.7%, followed by 0.9% higher Utilities and Capital Goods indices.

FIIs net sold stocks and index futures worth Rs 61 cr and 801 cr respectively but net bought stock futures worth Rs 698 cr. DIIs were net buyers to the tune of Rs 677 cr.

Rupee appreciated 3 paise to end at 64.35/$.

Yes Bank reported better-than-expected earnings and improvement in asset quality for the June quarter. Net profit rose 32% y-o-y to Rs 965 cr and NII surged 44% to Rs 1809 cr. Gross NPA ratio improved to 0.97% from 1.05% q-o-q and net NPA ratio improved to 0.39% from 0.81%. The Board also approved Stock Split in the ratio of 5 for 1.

HDFC's net profit fell 16.8% to Rs 1556 cr. Net interest margin fell to 4% from 4.31% y-o-y and 4.1% q-o-q. Gross NPA ratio deteriorated to 1.12% from 0.79% q-o-q.

In a dramatic development, Nitish Kumar yesterday resigned as Bihar Chief Minister following his standoff with ally Lalu Prasad Yadav. However, he will be sworn-in again as the Chief Minister today as BJP has decided to support to him.

OUTLOOK

Today morning, Asian markets, except half a percent lower Shanghai, are trading with modest gains and SGX Nifty is suggesting about 15 points higher start for our market.

At the risk of repeating, we have been working with target of 10070 after 9928 hurdle was taken out. Yesterday, Nifty, after touching a high of 10026, closed at 10021 and is set to open further higher today.

10070 continues to be immediate upside target. Immediate support on the hourly chart has moved up to 9940, with the stop-loss of which trading longs should be held on to.

ICICI Bank, ITC, HCL Tech, ONGC, Maruti, Idea, Dr Reddy, Glenmark and Biocon will report their quarterly earnings today.