11965 BELOW 12017; 12158 IS IMMEDIATE HURDLE

11965 BELOW 12017; 12158 IS IMMEDIATE HURDLE

WORLD MARKETS

US indices fell 0.4%-0.5% on Friday amid strained relations between the U.S. and China over protests in Hong Kong.

After Trump signed two pieces of legislation supporting protesters in Hong Kong, China’s foreign ministry responded, claiming the U.S. had “sinister intentions and added that the country will take “strong counter-measures” against the U.S.

Markets also kept an eye on retail stocks as Black Friday unofficially kicked off the holiday shopping season.

WTI crude futures fell more than 4% to settle at $55.1 while Brent fell $1.44 to settle at $62.43 a barrel on the back of resignation announcement of Iraq’s prime minister after weeks of deadly protests, as well as investors jockeying for position before the OPEC+ meeting next week.

In Europe, FTSE tumbled 0.9% while DAX and CAC fell 0.1% each. Data from U.K. showed consumer confidence remained stuck at its lowest level since 2013 in November, amid uncertainty over the Dec. 12 general election. Meanwhile, French GDP grew by 0.3% in the third quarter, in line with preliminary estimates.

For the week, US indices gained 0.6%-1.7% and European markets rose 0.2%-0.6%. In Asia, Nifty and Nikkei rose 1.2% and 0.8% respectively while Hang Seng and Shanghai fell 0.9% and 0.5% respectively. For the month, US indices surged 3.4%-4.5%, notching their biggest one-month gain since June.

AT HOME

Sensex and Nifty slipped eight tenth of a percent each on the last day of the week as well as month, breaking two-day winning streak. Sensex lost 336 points to settle at 40793 while Nifty finished at 12056, down 95 points. BSE mid-cap and small-cap indices however, rose 0.2% and 0.5% respectively. BSE Energy and Metal indices were the top losers among the sectoral indices, down 1.5% and 1.3% respectively while Telecom index soared 2.5%, becoming top gainer, followed by 0.9% higher Realty index.

FIIs net sold stocks and index futures worth Rs 1892 cr and 2002 cr respectively but net bought stock futures worth Rs 191 cr. DIIs were net buyers to the tune of Rs 954 cr.

Rupee depreciated 13 paise to end at 71.74/$.

For the week, Sesnex and Nifty gained 1.1% and 1.2% respectively, extending the winning streak to fifth and second consecutive week respectively.  For the month, Sensex and Nifty gained 1.6% and 1.5% respectively, extending the rising streak to third consecutive month.

India's GDP growth slowed to 4.5% in the second quarter from 5% in first quarter, marking the slowest pace of growth in over 6 years as manufacturing sector contracted 1%. Core sector, comprising eight core industries, showed a degrowth of 5.8% in October as against degrowth of 5.2% in September. April-October fiscal deficit stood at Rs 7.20 lk cr Vs Rs 6.48 lk cr y-o-y; This is 102.4% of the Rs 7.04 lk cr FY20 target.

GST revenue collection in November stood at Rs 1.03 lk cr, third highest since GST was introduced.

Maruti posted 2% yoy fall in November sales at 1.5 lk units. Tata Motors' total domestic sales fell 25% y-o-y to 38057 units. M & M auto sales fell 9% to 41235 units while tractor sales were down 19% at 25949 units.

Telecom companies announced tariff hikes ranging from 15-40%.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.2%-1% but SGX Nifty is suggesting about 15 points lower start for our market.

In Friday's report we had said that 12350 continued to be the next major target/resistance to eye while immediate support on the hourly chart had moved up to 12050, with the stop-loss of which, trading longs could be held on to.

Nifty slipped to touch a low of 12017 but rebounded to close at 12056.

11965, where 20 DMA as well as a trendline adjoining recent bottoms on the hourly chart is placed, is the next support to eye. If that breaks, 11883, the low made on 22nd November, would be the next important support.

12158, the top made last week, is now the immediate hurdle, a crossover of which is required for a fresh upmove. If that happens, 12350, where an upward sloping trendline adjoining tops made in August 2018 and June 2019 is placed, would be the next major target/resistance to eye.