NIFTY SET TO TEST 10330 HURDLE

NIFTY SET TO TEST 10330 HURDLE

WORLD MARKETS                             

US indices fell 0.3%-0.4%, with the Dow snapping a five-day winning streak, on uncertainty over tax reforms as two GOP Senators raised some concerns about the tax bill.

Weekly jobless claims totaled 225,000, well below an estimate of 239,000. Retail sales rose 0.8% in November versus an estimated increase of 0.3%.

The European Central Bank kept monetary policy steady, but upgraded its growth forecast for the region from 2.2% to 2.4% this year.

The Bank of England also kept its policy unchanged.

European markets fell 0.4%-0.9%.

AT HOME

After falling about half a percent in the morning session, benchmark indices surged more than a percent from the bottom of the day in noon trade to end higher by six tenth of a percent. Sensex settled at 33247, up 194 points while Nifty added 59 points to finish at 10252. Broader market however underperformed as BSE mid-cap index gained just 0.1% while small-cap index lost 0.3%. BSE Oil & Gas and Telecom indices gained the most among sectoral indices, rising 1% and 0.7% respectively whereas Consumer Durable index fell 0.6%, becoming top loser, followed by 0.04% lower Industrial and IT indices.

FIIs net bought stocks and stock futures worth Rs 232 cr and 611 cr respectively but net sold index futures worth Rs 661 cr. DIIs were net sellers to the tune of Rs 374 cr.

Rupee appreciated 9 paise to end at 64.34/$.

All the exit polls released yesterday predicted a clear BJP majority in both Himachal Pradesh and Gujarat. In Gujarat, various polls predict 99-135 seats for BJP.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.4%-0.8% but SGX Nifty is suggesting nearly 80 point higher start for our market.

After today's big gap up opening, Nifty would be very close to 10330 hurdle, which is the top made on Monday and where a downward sloping trendline adjoining tops made in November is placed. A decisive crossover of 10330 would also confirm a higher-top higher-bottom formation on the daily chart and would pave the way for further upmove. 10410 and 10490, the tops made in November, would be next upside targets in that case.

Meanwhile, traders can initiate longs once the top made in the first hour is taken out keeping a stop-loss of 10250, which is the immediate support on the hourly chart.