NIFTY TESTS 11486-11500 SUPPORT ZONE; 11660 IS THE IMMEDIATE HURDLE

NIFTY TESTS 11486-11500 SUPPORT ZONE; 11660 IS THE IMMEDIATE HURDLE

WORLD MARKETS

Dow ended marginally in the red while S & P 500 and Nasdaq fell 0.2% each.

Amazon shares rose 1.9%, briefly pushing the company's market cap to $1 trillion.

The ISM U.S. manufacturing PMI rose to 61.3 in August from 58.1 in July.

Dollar index rose 0.4% to 95.48.

European markets, except a 1% higher Italy, fell 0.6%-1.3% with France leading the losses.

Argentine President Mauricio Macri announced "emergency" measures to try to balance next year's budget, including new taxes on exports and steep cuts to government spending. The Argentine peso fell over 3% on the news.

AT HOME

Sensex and Nifty fell 0.4% and 0.5% respectively to close at the lowest level since 17th August. Sensex settled at 38158, down 155 points while Nifty lost 62 points to finish at 11520. BSE mid-cap and small-cap indices nosedived 2.6% and 2% respectively. Except a 1.9% and 1.3% higher IT and Teck indices respectively, all the BSE sectoral indices ended in red with Consumer Durable and Basic Material indices leading the losses, down 2.6% and 2.5% respectively.

FIIs net bough stocks worth Rs 33 cr but net sold index futures and stock futures worth Rs 336 cr and 583 cr respectively. DIIs were net sellers to the tune of Rs 21 cr.

Rupee depreciated 37 paise to end at 71.58/$.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.2%-0.8% and SGX Nifty is suggesting about 20 points lower start for our market.

After Nifty broke 11620 support on Monday, in yesterday's report we had said that "11532, the bottom made on 24th August, which also coincides with 20-DMA, is the next support to eye". We had also said that "Below 11532, 11500-11486 gap, created by a gap up opening on 20th August, would be the next support to eye".

Nifty yesterday plunged to 11496 before closing at 11520, achieving both the targets mentioned above and vindicating our view.

11500-11486 continues to be immediate support zone. Upon breach of 11486, 34-DMA, placed around 11400, would be the next crucial support to eye.

11660 is the immediate hurdle on the hourly chart above which 11760, the top made last week, would be the bigger hurdle to eye.