10890 IS THE IMMEDIATE HURDLE; 10628 IMMEDIATE SUPPORT

10890 IS THE IMMEDIATE HURDLE; 10628 IMMEDIATE SUPPORT

WORLD MARKETS

US indices soared 3.3%-4.3% on Friday on the back of Fed Chair Powell's comments and a blowout jobs report.

Federal Reserve Chairman Jerome Powell said the central bank will be patient in raising rates, quelling fears of tighter monetary policy in the near future. Powell added the central bank would not "hesitate" to change its balance-sheet reduction plan if it was causing problems.

U.S. economy added 312,000 jobs in December, much higher than the expected figure of 176,000. Later.

Also boosting the sentiment was the statement from China's commerce ministry that the U.S. and Chinese would hold vice-ministerial level negotiations over trade in Beijing on Jan. 7-8.

US crude rose 1.9% to $47.96 while Brent gained 2% to reach $57.06 a barrel.

European markets climbed 2.2%-3.4%. IHS Markit's euro zone composite final PMI fell to 51.1 in December, down from 52.7 in the previous month. The euro zone December inflation rate, meanwhile, fell steeper than was expected, to 1.6%, down from November's 1.9%. British house prices in December fell 0.7 percent from the previous month, the biggest monthly fall since July 2012.

AT HOME

Benchmark indices ended higher by half a percent after a volatile session, breaking two-day losing streak. Sensex added 181 points to settle at 35695 while Nifty finished at 10727, up 55 points. BSE mid-cap and small-cap indices gained 0.5% and 0.1% respectively.  BSE Telecom index climbed 2.7%, becoming top gainer among the sectoral indices, followed by 1.4% higher Metal index. IT and Teck indices were the top losers, down 1.2% and 0.6% respectively.

FIIs net sold stocks and index futures worth Rs 158 cr and 351 cr respectively but net bought stock futures worth Rs 145 cr. DIIs were net buyers to the tune of Rs 241 cr.

Rupee appreciated 47 paise to end at 69.72/$.

For the week, Sensex and Nifty fell 1% and 1.2% respectively.

India's December Nikkei services PMI eased to 53.2 from 53.7 in November. Composite PMI fell to 53.6 from 54.5.

OUTLOOK

Today morning, Nikkei is up 3% while Hang Seng and Shanghai are up 1.5% and 0.7% respectively. SGX Nifty is suggesting about 100 points higher start for our market.

Readers would recall that we had given downside targets of 10660, followed by 10534, after Nifty broke the immediate support of 10735. Nifty, after touching a low of 10628, rebounded to end at 10727 and is set to open above 10800 today.

A trendline adjoining recent tops on the daily chart is placed around 10890 and that would be the immediate hurdle to eye. If that is taken out, 10985, the top made on 19th December, would be the next target/hurdle to eye.

10628, the bottom made on Friday, is now the immediate support below which, 10534, the bottom made on 26th December, would be the next downside support.