NIFTY ACHIEVES 10985 TARGET; TRAIL STOP-LOSS TO 10860

NIFTY ACHIEVES 10985 TARGET; TRAIL STOP-LOSS TO 10860

WORLD MARKETS

US markets were shut yesterday for Martin Luther King Jr. Day holiday.

European markets, except a flat FTSE, fell 0.2%-0.6%, after fresh data from China showed its economy grew at its slowest pace since 1990.

Official data published yesterday said China's gross domestic product (GDP) in 2018 grew 6.6% from the previous year, in line with analyst expectations but at its most sluggish rate in almost three decades.

The IMF cut global growth forecast for 2019 to 3.5% from 3.7% and for 2020 to 3.6% from 3.7% projected in October — making it the second downturn revision in three months.

U.S. crude rose 19 cents to $53.99 a barrel while Brent was up 12 cents at $62.83.

Over the weekend, US President Trump said a trade deal with China "could very well happen," but denied what he called "false reports" that the U.S. was considering lifting duties on Chinese imports.

AT HOME

Benchmark indices ended higher by half a percent, extending the winning streak to fifth consecutive day. Sensex settled at 36578, up 192 points while Nifty added 55 points to finish at 10961. BSE mid-cap and small-cap indices however, fell 0.6% and 0.7% respectively. BSE Energy index climbed 2.7%, becoming top gainer among the sectoral indices, followed by 0.7% higher Oil & Gas index. Realty and Auto indices were the top losers, down 1.2% and 1.1% respectively.

FIIs net sold stock worth Rs 300 cr but net bought index futures and stock futures worth Rs 485 cr and 389 cr respectively. DIIs were net buyers to the tune of Rs 521 cr.

Rupee depreciated 9 paise to end at 71.27/$.

Kotak Mahindra Bank reported better-than-expected net profit and NII figures along with improvement in asset quality. Net profit rose 23% y-o-y to Rs 1291 cr while NII was up 27% at Rs 2939 cr. Net interest margin expanded to 4.33% from 4.2%.  Total advances grew 23%. Gross NPA ratio improved to 2.07% from 2.15% q-o-q and net NPA ratio fell to 0.71% from 0.81%.

IMF said it expects India's GDP to grow at 7.5% in FY2020, up from an earlier forecast of 7.4% and at 7.7% in FY2021. For FY19, GDP growth is expected at 7.3%.

OUTLOOK

Today morning, Asian markets are trading flat to modestly lower and SGX Nifty is suggesting a flattish start for our market.

For past couple of sessions, we had been working with upside target of 10985. Nifty yesterday touched a high of 10987 before closing at 10961, vindicating our view.

Above 10987, next upside target to eye would be 11090, which is the 61.8% retracement level of the entire 11760-10004 fall.

Immediate support on the hourly chart has moved up to 10860, with the stop-loss of which, trading longs can be held on to.

Asian Paints and TVS Motors will report their quarterly earnings today.