NIFTY REBOUNDS FROM 10860 SUPPORT; 10985 CONTINUES TO BE HURDLE

NIFTY REBOUNDS FROM 10860 SUPPORT; 10985 CONTINUES TO BE HURDLE

WORLD MARKETS

US indices tumbled 1.2%-1.9%, breaking 4-day winning streak, as weak data out of China and lower global growth estimates from the IMF renewed fears of the global economy slowing down.

Beijing announced Monday that the Chinese economy grew 6.6% in 2018, the slowest pace since 1990.

IMF yesterday trimmed its 2019 global growth forecast to 3.5% from 3.7% and also cut its 2020 growth outlook to 3.6% from 3.7%.

Economic data showed U.S. existing housing sales fell to their lowest level in three years.

US crude tumbled $1.23, or 2.3%, to $52.57 while Brent dropped $1.20, or 1.9%, to $61.54.

European markets fell 0.4%-1%.

AT HOME

Benchmark indices ended lower by about four tenth of a percent, breaking 5-day winning streak. Sensex settled at 36444, down 134 points while Nifty lost 39 points to finish at 10922. BSE mid-cap and small-cap indices fell 0.1% and 0.5% respectively. BSE Metal and Basic Materials indices tumbled 2.3% and 1.2% respectively, becoming top losers among the sectoral indices while Healthcare index rose 1.2%, becoming top gainer, followed by 0.9% higher Realty and Consumer Durable indices.

FIIs net sold stocks and index futures worth Rs 79 cr and 460 cr respectively but net bought stock futures worth Rs 764 cr. DIIs were net sellers to the tune of Rs 84 cr.

Rupee depreciated 16 paise to end at 71.43/$.

Asian Paints reported better-than-expected topline and bottomline but margins slid. Revenue rose 24.3% y-o-y to Rs 5294 cr, EBITDA was up 17.1% at Rs 1043 cr, margins fell 120 bps to 19.7% and Net profit was up 14.1% at Rs 647 cr.

OUTLOOK

Today morning, Nikkei and Hang Seng are modestly lower while Shanghai is marginally higher. SGX Nifty is suggesting a flattish start for our market.

After Nifty got resisted at our indicated 10985 hurdle, in yesterday's report we had said that immediate support on the hourly chart has moved up to 10860, which should now serve as the stop-loss for trading longs.

Nifty, after touching a low of 10864, rebounded to end at 10922, holding on to the support mentioned above.

10860 continues to be immediate support, a breach of which will generate a sell on the hourly chart and would pave the way for further fall.

10985, the top made in December, continues to be immediate hurdle, a decisive crossover of which is required for a further upmove.

ITC will report its quarterly earnings today.