NIFTY ACHIEVES 12095 TARGET; 12265 IS IMMEDIATE HURDLE

NIFTY ACHIEVES 12095 TARGET; 12265 IS IMMEDIATE HURDLE

WORLD MARKETS

Dow and S & P 500 ended little changed while Nasdaq rose 0.1% as IBM shares surged while worries over the spreading of the deadly coronavirus dampened sentiment.

IBM climbed 3% after quarterly numbers and 2020 earnings guidance  beat expectations.

Brent crude fell $1.39, or 2.2% to $63.20 per barrel while WTI fell 2.8%, or $1.64, to settle at $56.74 per barrel as a market surplus forecast by the International Energy Agency (IEA) and demand worries outweighed concern over disruptions to Libya’s crude output.

European markets fell 0.3%-0.6%. Germany's ZEW economic sentiment survey logged the highest “expectations” reading since July 2015, while the “current situation” gauge saw double-digit improvement.

AT HOME

After a positive start, benchmark indices saw a sustained downward move through the session to end lower by half a percent, with Sensex and Nifty extending the losing streak to third and fourth day respectively. Sensex settled at 41115, down 208 points while Nifty lost 63 points to finish at 12107. BSE mid-cap and small-cap indices fell 0.3% and 0.1% respectively. BSE Metal and Oil & Gas indices tumbled 1.6% and 1.5% respectively, becoming top losers among the sectoral indices while IT and Teck indices were the top gainers, up 1.1% each.

FIIs net sold stocks, index futures and stock futures worth Rs 176 cr, 927 cr and 1739 cr respectively. DIIs were net sellers to the tune of Rs 326 cr.

Rupee appreciated 1 paise to end at 71.19/$.

L & T reported weak performance for the third quarter but maintained FY20 revenue growth guidance at 12-15% and order inflow guidance at 10-12%.

Axis Bank's net profit missed estimate but loan growth, at 15.8% hit 7-quarter high and non watch list slippages, at Rs 2290 cr,  were best in 3 quarters. Net interest margin, at 3.57%, was a 10-quarter high.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.7%-1.1% as the death toll in China due to a mysterious pneumonia-like virus has risen to 17. SGX Nifty is suggesting a flattish start for our market.

Readers would recall that we had turned our view on Nifty negative below 12278 and have been advising holding on to short position with a trailing stop-loss.

After the benchmark achieved 34-DMA target of 12150, we had given next target of 12095 in yesterday's report.

Nifty yesterday touched a low of 12088 before closing at 12108, achieving this target and vindicating our view.

12088, the low made yesterday, which also coincides with the 67% retracement level of the recent 12930-12430 upmove, is the immediate support to eye upon breach of which 12000, where an upward sloping trendline adjoining recent bottoms on the daily chart is placed, would be the next support.

Immediate hurdle on the hourly chart has moved lower to 12265, with the stop-loss of which, trading shorts can be held on to.