10607 CONTINUES TO BE IMMEDIATE HURDLE; 10400 IMMEDIATE SUPPORT

10607 CONTINUES TO BE IMMEDIATE HURDLE; 10400 IMMEDIATE SUPPORT

WORLD MARKETS

US indices fell 0.8%-1.6% as continued slide in oil and disappointing data from China sparked fears of a global economic slowdown.

WTI crude fell 0.8% to $60.19 a barrel, after briefly breaking below $60 for the first time since March and extending the losing streak to tenth straight day. Brent fell 39 cents at $70.26 a barrel.

Auto sales in China fell 11.7% last month, marking the fourth straight monthly decline.

Comments on US-China trade front from White House trade advisor Peter Navarro that "If there is a deal — if and when there is a deal, it will be on President Donald J. Trump's terms. Not Wall Street's terms,", also soured the sentiment.

European markets, except flat DAX, fell 0.5%-0.9%.

For the week, Dow and S & P 500 surged 2.8% and 2.1% respectively while Nasdaq rose 0.7%, extending the winning streak to second consecutive week. European markets ended with marginal gains of 0.1%-0.2%. In Asia, Hang Seng and Shanghai nosedived 3.3% and 2.9% respectively while Nikkei was flat.

OPEC and its allies warned about surging oil output that is set to leave the crude market oversupplied in 2019 and said that they may have to launch a fresh round of output cuts in order to keep the oil market balanced. 

AT HOME

Sensex and Nifty ended modestly lower after trading in a narrow range on last day of the truncated Diwali week. Sensex lost 79 points to settle at 35158 while Nifty finished at 10585, down 13 points. BSE mid-cap and small-cap indices however gained 0.7% and 0.6% respectively. BSE IT and Teck indices tumbled 1.2% and 1.1% respectively, becoming top losers among the sectoral indices while Healthcare and Consumer Durable indices were the top gainers, up 1.1% and 0.8% respectively. BSE advance-decline ratio stood at 1.1:1.

FIIs net bought stocks, index futures and stock futures worth Rs 614 cr, 647 cr and 137 cr respectively. DIIs were net sellers to the tune of Rs 337 cr.

Rupee appreciated 50 paise to end at 72.49/$.

For the week, Sensex and Nifty gained 0.4% and 0.3% respectively, extending the winning streak to second straight week.

OUTLOOK

Today morning, Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 30 points lower start for our market.

Readers would recall that last to last week, Nifty made a top of 10607 which was very close to 34-DMA and we had said that a decisive crossover of this hurdle is required for a fresh upmove. Last week, Nifty hovered around this level, traded within a narrow 10619-10477 range and finally settled at 10585. The benchmark is set to open around 10550 today.

A sustained trading above 10607 is required for a fresh upmove. If that happens, 10710, the top made in mid-October, followed by 200-DMA placed around 10760, would be next targets/hurdles to eye.

10400 continues to be immediate support on the hourly chart, with the stop-loss of which, trading longs should be held on to.

India's October CPI will be out today and is expected to ease to 3.67% from 3.77% in the previous month. Industrial production for September will also be released and is expected to ease to  4.1% from 4.3%.

Coal India, Aurobindo Pharma and Eicher Motors will report their quarterly earnings today.