12160 CONTINUES TO BE IMMEDIATE HURDLE; 11925 IMMEDIATE SUPPORT

12160 CONTINUES TO BE IMMEDIATE HURDLE; 11925 IMMEDIATE SUPPORT

WORLD MARKETS

Dow tumbled 0.9% while S & P 500 and Nasdaq fell 0.5% each to snap four-day winning streak as worries over the coronavirus’ impact on the Chinese economy outweighed the release of stronger-than-expected U.S. jobs data.

China’s National Health Commission on Friday confirmed 31,131 cases of the deadly coronavirus in the country, with 636 deaths.

The U.S. economy added 225,000 jobs in January as against expected figure of 158,000. Wages rose 3.1% y-o-y, also topping expectations.

Brent futures lost 41 cents to $54.52 a barrel while WTI futures fell 63 cents, or 1.2%, to settle at $50.32 per barrel.

European markets fell 0.1%-0.5%.  German industrial output fell 3.5% from November in calendar-adjusted terms, well below the 0.1% rise expected. French industrial output also fell further than expected in December, tumbling 2.8% against an expectation of -0.4%.

For the week, Nasdaq soared 4% while Dow and S&P 500 rose 3% each. For the week, Brent plunged 6% while WTI fell 2.4% for its fifth straight week of losses.

AT HOME

Sensex and Nifty fell 0.4% and 0.3% respectively, breaking 4-day winning streak. Sesnex settled at 41141, down 164 points while Nifty lost 40 points to finish at 12098. BSE mid-cap and small-cap indices however ended higher by 0.4% and 0.8% respectively. BSE Realty index tumbled 2%, becoming top loser among the sectoral indices, followed by 1% lower Auto index. Healthcare and Consumer Durables indices were the top gainers, up 1.7% and 1.4% respectively.

FIIs net bought stocks and stock futures worth Rs 162 cr and 273 cr respectively but net sold index futures worth Rs 428 cr. DIIs were net sellers to the tune of Rs 179 cr.

Rupee depreciated 25 paise to end at 71.45/$.

For the week, Sensex and Nifty soared 3.7% and 3.5% respectively, breaking 2-week losing streak.

M & M's net profit plunged due to a one-time loss of Rs 601 cr but operationally, results were slightly above estimates. Revenue fell 6% y-o-y to Rs 12120, EBITDA rose 5% to Rs 1788 cr, margin improved 160 bps to 14.8% while Net profit fell 72.8% to Rs 380 cr.

Exit polls over the weekend predicted a clean sweep for Aam Aadmi Party in Delhi Assembly elections.

OUTLOOK

Latest update from China says that the death toll due to coronavirus has crossed 900 and confimed cases have topped 40000.

Today morning, Asian markets are trading with cuts of 0.6%-1% and SGX Nifty is suggesting about 30 points lower start for our market.

In Friday's report we had said that 12160, the top made Thursday, which coincided with 34-DMA as well as the 67% retracement level of the entire 12430-11614 fall, was the immediate hurdle to eye.

Nifty, after touching a high of 12155 in the initial trade, slipped to close at 12098, vindicating our view.

12160, the top made last week, continues to be important immediate hurdle, a crossover of which is required for a fresh upmove. If that happens, 12272, the top made on 24th January, would be the next target.

11925 continues to be immediate support on the hourly chart, with the stop-loss of which, positional longs can be held on to.

GAIL and Grasim will report its quarterly earnings today.