NIFTY ACHIEVES 9950 TARGET; 10070 IS THE IMMEDIATE HURDLE

NIFTY ACHIEVES 9950 TARGET; 10070 IS THE IMMEDIATE HURDLE

WORLD MARKETS                             

Dow ended marginally in the red while S & P 500 and Nasdaq gained 0.1% each.

Dollar index fell 0.14%. The yield on the 10-year Treasury note fell slightly to 2.259%.

European markets, except a 0.1% lower DAX, gained upto 0.6%. FTSE jumped, tracking a fall in Sterling following a speech from Prime Minister May which gave little detail on how she wants a Brexit transition period to work.

French second-quarter gross domestic product rose 0.5% from the previous quarter, on higher consumer spending. French flash PMIs showed that both services and manufacturing activities increased in August to their highest level since May 2011.

For the week, Dow and S & P 500 gained 0.4% and 0.1% respectively but Nasdaq fell 0.3%. In Europe, FTSE and CAC gained 1.3% each while DAX added 0.6%. In Asia, Nikkei soared 19%, Hang Seng and Shanghai rose 0.3% and 0.2% respectively but India fell 1.2%.

Moody's downgraded Britain's sovereign credit rating over the weekend to Aa2 from Aa1.

Trump tweeted on Saturday attacking North Korea's Foreign Minister Ri Yong-ho's comment about him during the United Nations General Assembly Meet. Soon after this, North Korea held a large anti-US rally in Pyongyang, supporting their leader Kim Jong-un.

AT HOME

Sensex and Nifty nosedived 1.4% and 1.6% respectively, registering the biggest single day fall since 21st November, 2016. Sensex slumped 448 points to settle at 31992 while Nifty finished at 9964, down 158 points. BSE mid-cap and small-cap indices tumbled 2.7% and 2.9% respectively. All the BSE sectoral indices ended in red with Realty and Metal indices leading the tally, down 4.3% and 4% respectively.

FIIs net sold stock and index futures worth Rs 1242 cr and 126 cr respectively but net bought index futures worth Rs 1688 cr. DIIs were net buyers to the tune of Rs 521 cr.

Rupee appreciated 2 paise to end at 64.79/$.

For the week, Sensex and Nifty lost 0.9% and 1.2% respectively.

The central government has extended the validity of interest subsidy benefit of about Rs.2.60 lakh on home loans under Pradhan Mantri Awas Yojana (Urban) for beneficiaries belonging to Middle Income Groups (MIG) by 15 more months beyond earlier stipulated one year period ending December this year.

OUTLOOK

Today morning, except a half a percent higher Nikkei, other Asian markets are trading with cuts of 0.2%-0.9% and SGX Nifty is suggesting a flattish start for our market.

In Friday's report we had reiterated the view that 10040 was the immediate support and if that is taken out, Nifty can slip to around 9950, where 34-DMA was placed.

Nifty, on Friday, broke 10040 support in the first hour itself and plunged all the way to 9953, achieving the 9950 target and vindicating our view.

9950 continues to be important immediate support, upon breach of which 9874, the 61.8% retracement level of the 9685-10180 upmove, would be the next immediate support. Below 9875, the possibility of retesting of 9685 would open up.

Immediate resistance on the hourly chart is placed around 10070 above which 10180, the top made last week, would be the bigger hurdle to eye.

Traders are advised to wait for the crossover of 10070-9950 levels on either side for taking a fresh view on Nifty.