STAY LONG WITH THE STOP-LOSS OF 10000 FOR NEXT TARGET OF 10300

STAY LONG WITH THE STOP-LOSS OF 10000 FOR NEXT TARGET OF 10300

WORLD MARKETS                             

US indices gained 0.2%-0.3% with the Dow closing at the fresh record high.

Core personal consumption expenditure (PCE) price index for June – which is watched by the Federal Reserve as an estimate of inflation — rose 1.5% y-o-y and 0.1% on-month, reflecting tepid inflation. Consumer spending rose just 0.1% in June and personal income for June remained unchanged, below an expected increase of 0.3%. The ISM manufacturing index stood at 56.3. The IHS Markit manufacturing PMI hit its highest level in four months in July, while construction spending declined 1.3% in June.

U.S. Treasury yields traded lower with the 10-year yield at 2.257% and the two-year yield near 1.347%. Dollar index, after hitting a 15-month low of 92.77 on Monday, rebounded to 93.049.

Oil fell more than 2% due to concerns over the increase in supply from global oil producers as output from OPEC producers increased in July despite the bloc's output cut agreement.

European markets added 0.6%-1.1%. A preliminary reading on Eurozone GDP showed a growth of 0.6% q-o-q and 2.1% y-o-y in the second quarter. Eurozone IHS Markit's final manufacturing PMI came in at 56.6 in July, just off June's six-year high of 57.4.

AT HOME

After trading in a narrow range for better part of the day, Sensex and Nifty spiked up in last half an hour to end at fresh record high with gains of 0.2% and 0.4% respectively. Sensex added 60 points to settle at 32575 and Nifty finished at 10115, up 38 points. BSE mid-cap index rose 0.4% but the small-cap index fell 0.1%. BSE Auto and Metal indices climbed 1.6% and 1% respectively, becoming top gainers among the sectoral indices while Consumer Durable was the top losers, down 0.8%, followed by 0.4% lower Telecom and Capital Goods indices.

FIIs net sold stocks, index futures and stock futures worth Rs 946 cr, 421 cr and 102 cr respectively. DIIs were net buyers to the tune of Rs 1391 cr.

Rupee appreciated 12 paise to end at fresh 11-week high of 64.08/$.

Maruti reported 20.6% jump in July sales at 1.65 lac units. That of Ashok Leyland rose 14% to 11981 units. Eicher Motors reported 21% rise in Royal Enfield sales at 64459 units. Escort's tractor sales rose 34.3% to 5418 units. Tata Motors sold 46216 units, a growth of 7%. M & M auto sales were up 6% at 41747 units while tractor sales rose 7% to 18832 units.

TVS Motor sales were up 9.34% at 2.71 lakh units while Hero MotoCorp sales surged 17% at 6.23 lakh units.

OUTLOOK

Today morning, Asian markets are trading with gains of upto 0.6% and SGX Nifty is suggesting a flattish start for our market.

For past couple of days, we had been mentioning that 10115, the top made last week, is the immediate hurdle, a crossoer of which is required for a fresh upmove.

Nifty yesterday touched a high of 10129 before closing exactly at 10115.

Next upside target continues to be around 10300. Immediate support on the hourly chart has moved up to 10000, below which 9944, the low made last week, would be next important support to eye.

Traders are advised to hold long positions with the stop-loss of 10000.

RBI, at the end of its two day monetary policy meeting, is widely expected to cut repo rate by 25 bps on the back of softer inflation and good progress of monsoon couple with less than encouraging industrial production and core sector growth data recently. As always, tone of the policy statement would be important to guage further possibility of interest rate cuts.

Lupin and PNB will report their quarterly earnings today.