12158 CONTINUES TO BE IMMEDIATE HURDLE; 11950 IMMEDIATE SUPPORT

12158 CONTINUES TO BE IMMEDIATE HURDLE; 11950 IMMEDIATE SUPPORT

WORLD MARKETS

US indices gained 0.4%-0.9%, extending the winning streak to fourth straight day and hitting fresh record highs.

National Association of Home Builders/Wells Fargo Housing Market Index rose in December to its highest level in 20 years and data from IHS Markit showed U.S. business activity hit a five-month high in December.

Earlier, data showed Chinese industrial production rose 6.2% in November on a year-over-year basis, topping expectations. Retail sales in China also jumped 8% last month.

Brent futures rose 16 cents to $65.37 a barrel while WTI crude rose 14 cents to settle near a three-month high of $60.21 a barrel.

European markets surge 0.8%-2.2% with FTSE on the top. IHS Markit euro zone flash composite PMI estimates for December came in line with expectations at 50.6, with service sector outperformance offsetting more disappointing manufacturing numbers. Manufacturing PMIs came in at 45.9 against a forecast of 47.3, down from 46.9 in November.

U.K. flash readings showed that both the services and manufacturing sectors had declined more sharply than expected in December. Composite PMI came in at 48.5, its lowest level since mid-2016, suggesting the world’s fifth-largest economy is on course to contract in the fourth quarter.

AT HOME

After rising about four tenth of a percent at the open, Sensex and Nifty slipped to end lower by a 0.2% and 0.3% respectively, breaking 3-day winning streak. Sensex settled at 40938, down 71 points while Nifty lost 33 points to finish at 12054. BSE mid-cap and small-cap indices fell 0.5% and 0.2% respectively. BSE Telecom and Metal indices tumbled 1.6% and 1.4% respectively, becoming top losers among the sectoral indices while IT and Teck indices were the top gainers, up 1.2% and 0.8% respectively.

FIIs net bought stocks worth Rs 728 cr but net sold index futures and stock futures worth Rs 597 cr and 253 cr respectively. DIIs were net sellers to the tune of Rs 796 cr.

Rupee depreciated 18 paise to end at 70.99/$.

November WPI inflation rose to 0.58% from 0.16% in October. Food inflation increased to 9.02% from 7.65%.

OUTLOOK

Today morning, Hang Seng and Nikkei are up 0.8% and 0.4% respectively while Shanghai is flat. SGX Nifty is suggesting about 30 points higher start for our market.

After Nifty achieved 12080 target on Friday, in yesterday's report we had said that 12158, the top made in November, was the next target/resistance to eye and had advised holding on to long positions with the stop-loss of 11950.

Yesterday, Nifty, after touching a high of 12135, slipped to end at 12054 but is set to open higher today.

12158, the top made in November, continues to be important immediate hurdle, a crossover of which is required for a fresh upmove. If that happens, 12325, where an upward sloping trendline adjoining tops made in September and November is placed, would be the next target to eye.

11950 continues to be immediate support, with the stop-loss of which, trading longs can be held on to.