11908 BELOW 11990; 12152 IS THE IMMEDIATE HURDLE

11908 BELOW 11990; 12152 IS THE IMMEDIATE HURDLE

WORLD MARKETS

US indices fell 0.8%-1.8% on Friday, extending Thursday's losses, after the number of new coronavirus cases escalated, fueling worries over a pronounced global economic slowdown.

China’s National Health Commission said another 889 cases had been confirmed in the mainland, while the death toll rose by 118 to 2,236. South Korea  also reported more than 200 cases. Also, data from the China Passenger Car Association showed auto sales plummeted by 92% in the first two weeks of February.

IHS Markit  said activity in the U.S. services sector hit its lowest level in more than six years, noting confidence was “subdued” to the coronavirus.

Safe haven buying pushed the 30-year bond yield to an all-time low, breaking below 1.9%. Gold hit a fresh seven-year high, gaining more than 1%.

Brent crude fell 1.4% to $58.46 a barrel, while U.S. crude dropped 0.9% to $53.38 a barrel.

European markets fell 0.4%-0.6%. Euro zone composite flash PMI came in at 51.6 in February, up from 51.3 in January and beating forecasts, while manufacturing jumped to 49.1 from 47.9, hitting a 12-month high and significantly exceeding expectations of 47.5. U.K. composite PMI came in at 53.3 in February, beating the forecast of 52.8.

For the week, US indices fell more than 1%. Brent and  U.S. crude rose 1.8% and 2.3% respectively, extending the rising streak to second straight week.

AT HOME

After rising modestly in the morning session, benchmark indices slipped in noon trade to end lower by four tenth of a percent on the last day of the truncated trading week. Sensex settled at 41170, down 152 points while Nifty lost 45 points to finish at 12080. Nifty mid-cap and small-cap indices however rose 0.7% and 0.4% respectively, extending the winning streak to second straight day. BSE Energy index fell 1%, becoming top loser among the sectoral indices, followed by 0.8% lower Oil & Gas and IT indices. Metal and Telecom indices were the top gainers, up 0.9% and 0.6% respectively.

FIIs net bought stocks and stock futures worth Rs 1495 cr and 97 cr respectively but net sold index futures worth Rs 753 cr. DIIs were net sellers to the tune of Rs 700 cr.

Rupee depreciated 13 paise to end at 71.65/$.

For the week, Sensex and Nifty lost 0.2% and 0.3% respectively, breaking two-week winning streak.

OUTLOOK

Today morning, Nikkei is shut while Hang Seng and Shanghai are down 0.9% and 0.3% respectively. SGX Nifty is trading around 11960, suggesting around 120 points lower start for our market when compared to Thursday's close of Nifty future, 12080.

In Thursday's report we had said that 12247, the top made the previous week, was the next upside target/resistance to eye and 12042-12030, the gap created by Wednesday's gap-up opening, would  act as the immediate support zone.

Nifty, after touching a high of 12152, slipped to end at 12080 and is set to open below 12000 today.

11990, the 67% retracement level of the recent 11908-12152 upmove, would be the support to eye in case of today's gap down opening. Upon sustained trading below 11990, 11908, the bottom made last week, would be the next support.

12152, the top made on Thursday, would now work as immediate hurdle.