11313 BELOW 11412; 11572 IS THE IMMEDIATE HURDLE

11313 BELOW 11412; 11572 IS THE IMMEDIATE HURDLE

WORLD MARKETS

US indices nosedived 1.8%-2.5% on Friday on worries over global growth emanating from inverted yield curve, weak economic data out of Europe and a downgraded economic outlook from the Fed.

The spread between the 3-month Treasury bill and the 10-year note went negative on Friday for the first time in more than a decade, which is taken as a signal that a recession may be coming soon.

US oil fell 1.6% to $59.04 while WTI fell 1.3% to $66.96 a barrel.

European markets fell 1.4%-2%. IHS Markit’s flash euro zone composite PMI fell to 51.3 in March from 51.9 the previous month, its lowest level since April 2013. French and German numbers also disappointed. Manufacturing activity in Germany dropped to its lowest level in more than six years in March. The yield on the country’s 10-year government bond turned negative for the first time since October 2016 as a result.

The European Union agreed to an extension to the date of the U.K.’s withdrawal from the bloc, but said the length of the delay would depend on whether Parliament approves Prime Minister Theresa May’s Brexit deal next week.

For the week Dow and S & P 500 fell 1.3% and 0.8% respectively but Nasdaq gained 0.3%. In Europe, DAX and CAC nosedived 2.8% and 2.5% respectively and FTSE was down 0.3%. In Asia, Shanghai climbed 2.7%, Hang Seng rose 0.3% while Nikkei nosedived 2.6%.

AT HOME

Sensex and Nifty fell 0.6% each, with Sensex breaking eight-day winning streak and Nifty extending the losing streak to second day. Sensex settled at 38164, down 222 points while Nifty lost 64 points to finish at 11456. BSE mid-cap and small-cap indices fell 0.6% and 0.4% respectively. BSE Energy and Telecom indices fell 2% and 1.4% respectively, becoming top losers among the sectoral indices while Power and Realty indices were the top gainers, up 0.8% and 0.7% respectively.

FIIs net bought stocks and index futures worth Rs 1375 cr and 550 cr respectively but net sold stock futures worth Rs 1885 cr. DIIs were net sellers to the tune of Rs 675 cr.

Rupee depreciated 13 paise to end at 68.95/$.

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

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.5%-3% and SGX Nifty is suggesting about 50 points lower start for our market.

Readers would recall that we had tuned our view positive ever since immediate hurdle of 10723 was taken out on 20th February and have been advising holding on to long positions with a trailing stop-loss.

In Friday's report we had asked trailing the stop-loss to 11450.

Nifty, after touching a high of 11572 in the initial trade, slipped to touch a low of 11434 before closing at 11456 and is set to open near 11400 today.

11412, the low made last week, is the immediate support to eye, upon sustained trading below which, 11313, the low made on 14th March, would be the next support.

11573, the top made on Friday, is now the immediate hurdle, a crossover of which is required for a fresh upmove.