10775 IS THE NEXT TARGET/HURDLE; 10600 IMMEDIATE SUPPORT

 10775 IS THE NEXT TARGET/HURDLE; 10600 IMMEDIATE SUPPORT

WORLD MARKETS

Nasdaq ended flat while Dow and S & P 500 gained 0.3% and 0.4% respectively on hope that the U.S. and China will strike a compromise on trade.

National Economic Council Director Larry Kudlow said the White House was having "a lot of communication with the Chinese government at all levels" ahead of a meeting between Trump and his Chinese counterpart, Xi Jinping and that Trump thinks there is a "good possibility" the two countries can reach and agreement.

Kudlow's comments came after Trump told media that it was "highly unlikely" that the U.S. would delay from increasing tariffs on $200 billion in Chinese goods to 25% and a 10% tariff on laptops and iPhones imported from China could be imposed.

Fed Vice Chairman Richard Clarida said the central bank was "much closer" to a neutral rate than it was in December 2015, the first time the Fed hiked since the financial crisis. "How close is a matter of judgment, and there is a range of views on the FOMC," he said.

US crude fell 7 cents to $51.56 a barrel. Brent fell 27 cents to $60.21.

European markets fell upto 0.4%.

AT HOME

After falling about a third of a percent in the morning, benchmark indices rebounded smartly in noon trade to end higher by about half a percent. Sensex settled at 35513, up 159 points while Nifty added 57 points to finish at 10685. BSE mid-cap and small-cap indices gained 0.3% and 0.4% respectively. BSE IT and Teck indices climbed 1.7% and 1.4% respectively, becoming top gainers among the sectoral indices while Healthcare and Metal indices were the top losers, down 0.9% and 0.8% respectively.

FIIs net bought stocks worth Rs 812 cr but net sold index futures and stock futures worth Rs 705 cr and 103 cr respectively. DIIs were net buyers to the tune of Rs 31 cr.

Rupee appreciated 11 paise to end at 70.76/$.

OUTLOOK

Today morning, shanghai is flat while Hang Seng and Nikkei are up 0.3% and 0.7% respectively. SGX Nifty is suggesting about 30 points higher start for our market.

In yesterday's report we had said that 10665, the 61.8% retracement level of the recent 10775-10490 fall, is the immediate hurdle upon crossover of which, 10775, the top made last week, would be the next target to eye.

Nifty crossed 10665 hurdle and went all the way to 10695 before closing at 10685 and is set to open above 10700 today.

10775, the top made on 19th November, continues to be next upside target as well as resistance to eye. If Nifty is able to take out this hurdle, 10880, the 50% retracement level of the entire 11760-10004 fall, would be the next target/resistance to eye.

10600 is the immediate support on the hourly chart, below which 10490, the bottom made on Monday, would be the important support to eye. Traders are advised to hold long positions with the stop-loss of 10600.