NIFTY REBOUNDS FROM 10515-10550 SUPPORT ZONE; 10638 CONTINUES TO BE IMMEDIATE HURDLE

NIFTY REBOUNDS FROM 10515-10550 SUPPORT ZONE; 10638 CONTINUES TO BE IMMEDIATE HURDLE

WORLD MARKETS

After negative start, US indices saw a sustained northward move through the session to end flat to modestly higher, with the Dow breaking five-day losing streak.

Recovery was led by Boeing, which surged 4.2% after reporting quarterly results that easily beat market expectations.

US 10-year treasury yield traded at 3.03% after breaking above 3% for the first time since 2014 on Tuesday. Dollar index gained nearly half a percent to reach 91.26, the highest level in nearly four months.

Twitter and Comcast also released better-than-expected earnings.

U.S. crude gained 35 cents to $68.05 a barrel while Brent added 14 cents to $74.

European markets fell 0.6%-1%.

AT HOME

After trading in a narrow range, benchmark indices slipped in the late noon trade to end with cuts of nearly four tenth of a percent. Sensex lost 115 points to settle at 34501 while Nifty lost 44 points to finish at 10570. BSE mid-cap and small-cap indices fell 0.5% and 0.7% respectively. BSE Metal and Oil & Gas indices tumbled 1.4% and 1.3% respectively, becoming top losers among the sectoral indices while IT and Telecom indices were the top gainers, up 1.2% and 0.7% respectively.

FIIs net sold stocks worth Rs 305 cr but net bought index futures and stock futures worth Rs 163 cr and 319 cr respectively. DIIs were net buyers to the tune of Rs 436 cr.

Rupee nosedived 52 paise to hit a 14-month low of 66.90/$.

Ultratech reported 29% y-o-y dip in March quarter standalone net profit at Rs 488 cr due to Rs 226 cr provision for stamp duty, stripped off which profit was nearly unchanged at Rs 667 cr. Revenue rose 36.5% to Rs 9002 cr. Domestic volume surged 32% to 17.64 million tonne. EBIDTA jumped 33.2% to Rs 1703 cr and margin contracted 50 bps to 18.9%.

Wipro’s earnings were a big miss and guidance too disappointed. Net profit dipped 6.7% q-o-q to Rs 1803 cr as it made provisions for an insolvent client and an impairment loss in one of its acquisitions. Revenue grew 0.7% to Rs 13669 cr. Revenue in dollar terms from IT services rose 2.4% sequentially at $2.06 billion, in line with what the company had forecast. IT services revenue in constant currency terms remained flat at Rs 13,410 crore. The IT services margin for the quarter stood at 14.4%. Company guided for IT services revenue growth of -2.3%-0.1% for June quarter.

OUTLOOK

Today morning, Shanghai is flat while Hang Seng and Nikkei are up 0.3% and 0.7% respectively.   SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that 10550-10515 is the immediate support zone for Nifty, a breach of which would trigger a "sell" on the hourly chart and would pave the way for further correction.

Nifty, after touching a low of 10536, recovered to close at 10570 and is set to open around the same level today.

10550-10515 continues to be immediate support zone. 10638, the top made on Monday, continues to be immediate hurdle, a crossover of which is required for a fresh upmove.

Meanwhile, traders are advised to hold long positions with the stop-loss of 10515.

Axis Bank and Yes Bank will report their quarterly earnings today.