NIFTY NEARS CRUCIAL SUPPORTS; 11940 IS IMMEDIATE HURDLE

NIFTY NEARS CRUCIAL SUPPORTS; 11940 IS IMMEDIATE HURDLE

WORLD MARKETS

After gaining more than a percent in the initial trade, Dow and S & P 500 saw a sustained downward move through rest of the session to end with cuts of 0.5% and 0.4% respectively while Nasdaq gained just 0.2% as the 10-year Treasury yield traded at a record low amid concerns over the coronavirus spreading even further.

After hovering around 1.36% earlier in the day, the 10-year Treasury yield slid to an all-time low of 1.3%  after Bloomberg News cited a Food and Drug Administration official saying the coronavirus was on the cusp of a pandemic.

Brent crude fell $1.52 or 2.7% to settle at $53.43 per barrel, while WTI fell 2.34%, or $1.17, to $48.73 per barrel.

In Europe, FTSE and CAC gained 0.4% and 0.1% respectively while DAX fell 0.1%. French consumer confidence slightly exceeded expectations to remain stable in February at a reading of 104.

AT HOME

Sensex and Nifty nosedived 1% each, extending the losing streak to fourth straight day and closing at the lowest level since 3rd February and 1st February respectively. Sensex settled at 39888, down 392 points while Nifty lost 119 points to finish at 11678. BSE mid-cap and small-cap indices fell 1.3% and 0.8% respectively. Except 0.2% higher Telecom index, all the BSE sectoral indices ended in red with Realty index leading the fall, down 2.2%, followed by 2.1% lower Auto and Capital Goods indices.

FIIs net sold stocks, index futures and stock futures worth Rs 3337 cr, 1262 cr and 1477 cr respectively. DIIs were net buyers to the tune of Rs 2786 cr.

Rupee appreciated 9 paise to end at 71.64/$.

OUTLOOK

Today morning, Nikkei and Hang Seng are down 1.4% and 0.6% respectively while Shanghai is marginally higher. SGX Nifty is suggesting about 30 points lower start for our market.

In yesterday's report we had said that 11684, where 200-DMA was placed, was the next immediate support, upon breach of which, 11614, the bottom made on 3rd February, would be the next crucial support. We had also advised holding on to short positions with the stop-loss of 11985.

Nifty, after achieving 200-DMA target, fell further to 11640 and finally closed at 11678.

11614, the bottom made on 3rd February, continues to be next important support to eye. If 11614 breaks, 20-month moving average, placed around 11400, would be the next support.

Immediate hurdle on the hourly chart has moved lower to 11940, with the stop-loss of which, trading shorts can be held on to.