NIFTY STAGES A SHARP REBOUND AFTER ACHIEVING 11090 TARGET

NIFTY STAGES A SHARP REBOUND AFTER ACHIEVING 11090 TARGET

WORLD MARKETS

US indices gained 0.7%-1%, breaking two-day losing streak, on news that China is prepared to accept a partial trade deal.

The report said that China is willing to discuss a potential accord providing no more tariffs are imposed by President Donald Trump’s administration, including duties scheduled this month and in December.

Minutes of September Fed meeting showed the trade war remains a concern for Fed officials. However, they also showed central-bank officials think the market may be overly optimistic about the number of rate cuts moving forward. S

Brent crude rose 22 cents to $58.44 a barrel while WTI fell 4 cents to $52.59.

European markets rose 0.3%-0.8%.

AT HOME

After falling about a third of a percent in the initial trade, benchmark indices jumped two percent from the bottom of the day to end higher by 1.7%, breaking six-day losing streak. Sensex settled at 38178, up 646 points while Nifty added 187 points to finish at 11313. BSE mid-cap and small-cap indices gained 1.4% and 0.7% respectively. BSE Telecom index and Bankex soared  4.9% and 3.7% respectively, becoming top gainers among the sectoral indices while IT and Consumer Durables indices fell 0.9% and 0.4% respectively, becoming top losers.

FIIs net sold stocks and index futures worth Rs 485 cr and 167 cr respectively but net bought stock futures worth Rs 903 cr. DIIs were net buyers to the tune of Rs 956 cr.

Rupee depreciated 5 paise to end at 71.07/$.

OUTLOOK

A South China Morning Post report earlier today said US and China, in deputy-level negotiations that were held earlier this week, made no progress and China refused to discuss the issue of forced technology transfers. The report also said that high-level trade negotiations including Chinese Vice Premier Liu He would be cut to one day now.

Today morning, Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 60 points lower start for our market.

Readers would recall that after Nifty breached 200-DMA support placed at 11250, we had given next downside target of 34-DMA, which was placed around 11090.

Nifty, yesterday touched a low of 11090, exactly achieving this target and rebounded sharply from there to end at 11313 but is set to open near 11250 today.

11322, the top made yesterday, is the immediate hurdle to eye, upon crossover of which, 11390, the 50% retracement level of the recent 11695-11090 fall, would be the next upside target to eye.

11090, the low made yesterday, continues to be important immediate support.

TCS and Indusind Bank will report their quarterly earnings today.