NIFTY REBOUNDS FROM THE VICINITY OF 11625 SUPPORT; RESISTED NEAR 11844 HURDLE

NIFTY REBOUNDS FROM THE VICINITY OF 11625 SUPPORT; RESISTED NEAR 11844 HURDLE

WORLD MARKETS

US indices fell 0.7%-1.5% after comments from top Federal Reserve officials cooled market optimism around a potential rate cut next month.

Fed Chair Jerome Powell said the U.S. central bank is assessing whether current economic uncertainties call for lower rates. Powell noted the Fed will take a wait-and-see approach given how rapid recent economic changes have been, but added the Fed is “insulated from short-term political interests. ” Earlier, James Bullard, president of the St. Louis Fed, said in a media interaction that “Just sitting here today I think 50 basis points would be overdone”.

The Conference Board said its consumer confidence index fell to 121.5, hitting its lowest level since September 2017.

US oil rose 18 cents to $58.09 a barrel while Brent rose 32 cents to $65.18.

European markets, except a 0.1% higher FTSE, fell 0.1%-0.7% with Italy leading the losses. French business confidence figures showed sentiment for June falling to its lowest since November 2016, down to 102 from 104 in May.

AT HOME

After starting with a cut of about four tenth of a percent, benchmark saw a sustained northward move through the session to end higher by eight tenth of a percent, breaking 2-day losing streak. Sensex settled at 39434, up 311 points while Nifty added 96 points to finish at 11796. BSE mid-cap and small-cap indices gained 0.7% and 0.3% respectively. Except a 0.2% lower Capital Goods index, all the BSE sectoral indices ended in green with Energy and Metal indices leading the tally, up 2.2% and 1.8% respectively.

FIIs net bought stocks and stock futures worth Rs 1158 cr and 694 cr respectively but net sold index futures worth Rs 1103 cr. DIIs were net buyers to the tune of Rs 377 cr.

Rupee appreciated 1 paise to end at 64.34/$.

OUTLOOK

Today morning, key Asian markets are trading with cuts in the vicinity of half a percent and SGX Nifty is suggesting about 40 points lower start for our market.

In yesterday's report we had said that "11625, the bottom made last week, is the next support to eye" while 11844, the top made last week, continues to be immediate hurdle.

Nifty, after touching a low of 11651, reversed to touch a high of 11814 before closing at 11796 and is set to open near 11750 today.

11844, the top made last week, continues to be immediate hurdle, a crossover of which is required for the next leg of upmove. If that happens, 11945, the two-third retracement level of the recent 12103-11625 fall, would be the next target.

11625 continues to be important immediate support.