NIFTY RETREATS FROM 12294 HURDLE; 12118 CONTINUES TO BE IMMEDIATE SUPPORT

NIFTY RETREATS FROM 12294 HURDLE; 12118 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS

US indices fell 0.6%-0.7%, as investors took off some profits on the second last trading day of the calendar 2019.

The South China Morning Post reported yesterday that Chinese Vice Premier Liu He will visit Washington this week to sign the agreement. White House trade advisor Peter Navarro said that the signing will likely happen within next week or so with both sides waiting for the translation.

Data on Friday showed the trade deficit shrank to its narrowest since 2016 in November.

WTI futures fell 4 cents to settle at $61.88 per barrel while Brent futures gained 28 cents to settle at $68.44.

European markets fell 0.7%-1.1%.

AT HOME

Sensex ended marginally lower while Nifty inched up a bit on the second last trading day of the calendar 2019. Sensex settled at 41558, down 17 points while Nifty added 10 points to finish at 12255. BSE mid-cap and small-cap indices outperformed, rising 0.3% and 0.8% respectively. BSE Auto and Metal indices climbed 1.4% and 1.2% respectively, becoming top gainers among the sectoral indices while IT index and Bankex were the top losers, down 0.3% each.

FIIs net sold stocks, index futures and stock futures worth Rs 130 cr, 337 cr and 98 cr respectively. DIIs were net buyers to the tune of Rs 201 cr.

Rupee appreciated 4 paise to end at 71.31/$.

OUTLOOK

China's December manufacturing PMI has come in unchanged at 50.2 month-on-month.

Today, markets in Japan and South Korea are closed, while Hong Kong, Singapore and Australia will end their trading day earlier. Meanwhile, Shanghai is little changed and Hang Seng is down 0.3% at the time of writing this report. SGX Nifty is suggesting about 45 points lower start for our market.

In yesterday's report we had said that 12294, the top made on 20th December, was the upside resistance to eye while, 12118, the bottom made last week, was the immediate support.

Nifty, after touching a high of 12286, eased to end at 12255 and is set to open near 12200 today.

12294, the top made on 20th December, continues to be immediate hurdle, a crossover of which is required for a fresh upmove. If that happens, 12425, where an upward sloping trendline adjoining tops made in September and November is placed, would be the next major target/resistance to eye.

12118, the bottom made last week, continues to be immediate support.