12170-12200 CONTINUES TO BE RESISTANCE ZONE; 11900 BELOW 12010

12170-12200 CONTINUES TO BE RESISTANCE ZONE; 11900 BELOW 12010

WORLD MARKETS

After falling more than half a percent in the first half on concerns around the coronavirus, US indices rebounded sharply in second half to end with gains of 0.3%-0.4%.

World Health Organization declared a global health emergency over the the coronavirus outbreak, but at the same time, did not recommend travel to China be restricted and said the country had the situation under control.

The death toll in China from the coronavirus hit 171, with confirmed cases of the virus surpassing 8,000. The Centers for Disease Control and Prevention later confirmed the first human-to-human transmission of the virus in the U.S.

Microsoft rose 2.8% after reporting better-than-expected quarterly result. Tesla soared 10.3% after reporting second consecutive quarterly profit on record vehicle deliveries and vowed to produce over 500,000 units this yea. Facebook plunged more than 6% after reporting sharp rise in expenses and narrowing margins.

Brent fell $1.52, or 2.5%, to settle at $58.29 per barrel. WTI crude fell $1.19, or 2.2%, to $52.14 per barrel.

Main European markets tumbled 1.4% each. Euro zone sentiment jumped in January as manufacturing confidence rose to its highest level since August. Bank of England voted 7-2 to keep the base rate at 0.75%.

AT HOME

Sensex and Nifty slipped 0.7% and 0.8% respectively to close at the lowest level since 8th January, marking a 3-week low. Sensex settled at 40913, down 284 points while Nifty lost 93 points to finish at 12035. Nifty mid-cap and small-cap indices tumbled 0.8% and 1.6% respectively, the biggest fall since 6^th January. All the BSE sectoral indices ended in red with Energy and Oil & Gas indices leading the losses, down 2.3% and 1.8% respectively.

FIIs net sold stocks and index futures worth Rs 962 cr and 1534 cr respectively but net bought stock futures worth Rs 175 cr. DIIs were net buyers to the tune of Rs 292 cr.

Rupee depreciated 23 paise to end at 71.48/$.

OUTLOOK

Today morning, Nikkei and Hang Seng are up 1.4% and 0.7% respectively. SGX Nifty is suggesting about 35 points higher start for our market.

Readers would recall that we had said that below 12088, 12000, where an upward sloping trendline adjoining recent bottoms on the daily chart is placed, would be the next important support.

Yesterday, Nifty, after touching a low of 12010, closed at 12035 and is set to open above 12050 today.

12010, the bottom made yesterday, which coincides with the upward sloping trendline adjoining recent bottoms on the daily chart, continues to be immediate support. Below 12010, 11890, where 20-week moving average is placed, would be the next important support.

12170, the top made on Wednesday, is the immediate hurdle on the hourly chart. Moreover, 20 and 34 DMAs are placed at 12190 and 12200 respectively, making 12170-1200 an important resistance zone, a crossover of which is required for a fresh upmove. If that happens, 12300 and 12430 would be next upside targets to eye.

SBI, ITC, HUL,Tech Mahindra and Powergrid will report their quarterly earnings today.

Budget Session of the Parliament starts today. Economic Survey will be tabled today while Union Budget will be presented tomorrow.