10000 UNDER THREAT

10000 UNDER THREAT

WORLD MARKETS

US indices nosedived 4.7%-5.9%, with the Dow Jones Industrial Average plunging into bear market territory as the World Health Organization (WHO) declared the coronavirus outbreak a global pandemic.

The disease has infected at least 121,000 and more than 4,300 people have died so far, according to the latest figures from the Johns Hopkins University.

President Donald Trump pitched a 0% payroll tax rate for the rest of 2020, but the timing of such policies being implemented remains uncertain.

The Bank of England cut its benchmark rate by 50 basis points to 0.25% and announced a new term-funding scheme to support small and medium-sized businesses, along with measures to help commercial banks lend more. The Federal Reserve also increased the amount of money it is providing to banks through overnight repo lending to $175 billion.

Brent crude slid $1.27, or 3.4%, to $35.95 per barrel, while WTI dropped $1.38, or 4.02%, to settle at $32.98 per barrel after Saudi Aramco said it had been directed by the energy ministry to raise its production capacity by a million barrels per day.

Main European markets fell 0.4%-1.4%.

AT HOME

It was a day of consolidation as benchamrk indices ended little changed after a choppy session. Sensex settled at 35697, up 62 points while Nifty added 7 points to finish at 10458. BSE mid-cap and small-cap indices fell 0.9% and 0.4% respectively. BSE Energy index climbed 2.1%, becoming top gainer among the sectoral indices, followed by 0.4% higher Capital Goods and Finance indices. Realty and Metal indices were the top losers, down 2% and 1.6% respectively.

FIIs net sold stocks worth Rs 3515 cr but net bought index futures and stock futures worth Rs 1216 cr and 429 cr respectively. DIIs were net buyers to the tune of Rs 2835 cr.

Rupee appreciated 46 paise to end at 73.64/$.

OUTLOOK

Indian Health Ministry has suspended all existing visas (with some exceptions) till April 15.

Today morning, Asian markets are trading with cuts of 1.1%-3.5%. US futures are down more than 3%. SGX Nifty is suggesting about 400 points lower start for our market.

In yesterday's report we had reiterated the view that 10300-10150 continued to be important support zone while 10751-10827 was the immediate resistance zone. We has also advised holding on to short positions with the stop-loss of 10827.

Nifty, after touching a high of 10545, slipped to end at 10458 and is set to open near 10000 today.

10004, the bottom made in October 2018, would be the next support to eye after today's big gap-down opening. If 10004 also gives way, next meaningful support will come only at 9630, which is the 50% retracement level of the entire 6825-12430 upmove.

10751, the lower end of the gap created by Monday's gap down opening, would now act as immediate hurdle, with the stop-loss of which, trading shorts can be held on to.

February CPI will be released today and is expected to soften to 6.8% as against 7.6% in the previous month. January IIP will also be out today and is expected at 0.6%, up from negative 0.3% in December.