11780 ABOVE 11721; TRAIL STOP-LOSS TO 11585

11780 ABOVE 11721; TRAIL STOP-LOSS TO 11585

WORLD MARKETS

US indices fell 0.4%-0.6% after media reports suggested that progress on a trade deal with China are stalled over restrictions on Huawei.

Bank of America and United Airlines reported better-than-expected earnings.

Brent crude futures fell 74 cents to $63.61 a barrel and WTI futures fell 84 cents to $56.78 after data from the U.S. Energy Information Administration showed large builds in refined product stockpiles last week.

European markets fell 0.6%-1%. Euro zone inflation year-on-year for June came in slightly higher than initially forecast at 1.3%, but remained below the  ECB target of a rate of just below 2%. British inflation matched the Bank of England’s 2% target for the second consecutive month.

AT HOME

Benchmark indices ended higher by a fifth of a percent after a choppy session, extending the winning streak to third straight day. Sensex added 84 points to settle at 39215 while Nifty finished at 11687, up 24 points. Broader market however underperformed, with BSE mid-cap and small-cap indices down 0.2% and 0.1% respectively. BSE IT and Teck indices gained 0.9% and 0.8% respectively, becoming top gainers among the sectoral indices while Auto index tumbled 1%, becoming top loser, followed by 0.8% lower Utilities index.

FIIs net sold stocks, index futures and stock futures worth Rs 17 cr, 385 cr and 204 cr respectively. DIIs were net buyers to the tune of Rs 209 cr.

Rupee depreciated 10 paise to end at 68.81/$.

Wipro results was a miss on revenue front. Dollar revenue de-grew by 1.8% q-o-q. In constant currency terms, revenue fell 0.7%. The company guided for 0-2% growth in Q2 IT services dollar revenue.

OUTLOOK

Today morning, Nikkei is down 1.3% while Hang Seng and Shanghai are off 0.7% and 0.3% respectively. SGX Nifty is suggesting about 25 points lower start for our market.

After Nifty crossed 11650 hurdle, in yesterday's report we had said that 11721, the 50% retracement level of the recent 11981-11461 fall, is the next upside target to eye.

Nifty yesterday touched a high of 11706 before closing at 11687 and is set to open near 11650 today.

11721, as mentioned above, continues to be immediate upside target to eye above which, 11780 and 11810, which are the 61.8% and 67% retracement levels of this fall, would be next important targets/hurdles.

Immediate support on the hourly chart has moved up to 11585, with the stop-loss of which, trading longs should be held on to.

ACC, Colgae and L & T infotech are the key earnings to eye today.