TRAIL STOP-LOSS TO 8800

TRAIL STOP-LOSS TO 8800

WORLD MARKETS

US indices fell 1.4%-2.2% a plunge on the back of gloomy economic data and dismal bank earnings.

US March retail sales plunged 8.7%, marking the largest one-month decline since the beginning of the series in 1992. Manufacturing in the New York area also slumped by its biggest margin ever to a historic low, surpassing the levels seen during the Great Recession.

Goldman Sachs and Citigroup saw earnings tumble 46% in the first quarter, with both missing consensus analyst forecasts. Bank of America reported a profit decline of 45% and a $3.6 billion spike in loan-loss reserves.

Brent crude plunged 6.4% to $27.69 per barrel while WTI crude fell 1.2% to settle at $19.87 per barrel, its lowest settle since Feb. 2002 after International Energy Agency (IEA) forecasted a 29 million barrel per day (bpd) dive in April oil demand to levels not seen in 25 years and said no output cut could fully offset the near-term falls facing the market.

European markets slipped 3.3%-4.8%.

AT HOME

After gaining nearly 3% in morning, Sensex and Nifty gave away all the gains in steep noon plunge to end lower by 1% and 0.8% respectively, extending the losing streak to second straight day. Sensex settled at 30380, down 310 points while Nifty lost 68 points to finish at 8925. BSE mid-cap and small-cap indices however gained 1.3% and 1.2% respectively. BSE Bankex and Finance indices slipped 2.5% and 2.4% respectively, becoming top losers among the sectoral indices while FMCG index climbed 4.3%, becoming top gainer, followed by 2.5% higher Basic Materials index.

FIIs net bought stocks and index futures worth Rs 1359 cr and 1283 cr respectively but net sold stock futures worth Rs 195 cr. DIIs were net sellers to the tune of Rs 1098 cr.

Rupee depreciated 17 paise to end at 76.44/$.

Government yesterday allowed select factories, IT and IT enabled services, construction & municipal activity to resume operations after April 20, but with strict conditions. However, no activity will be allowed inside containment zones. Also, there will be no relief for airlines, hotels, malls and cinemas.

Indian Meteorological department said that southwest monsoon is expected to be normal this year.

Wipro's Q4 numbers missed expectations and its own guidance. Constant currency revenue growth was inline with expectations . Company skipped giving a guidance for Q1 saying the coming quarters appear challenging.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.2%-1.4% and SGX Nifty is suggesting about 60 points lower start for our market.

Readers would recall that we had advised going long on Nifty after 8678 hurdle was taken out on 7th April and have advising holding on to long positions with a trailing stop-loss.

In yesterday's report we had said that 9390, the the 38.2% retracement level of 12430-7511 fall, would be the next target/resistance to eye once Nifty sustains above 9134.

Nifty opened above 9134 hurdle and touched a high of 9261, but slipped sharply from there to end at 8925 and is set to open below 8900 today.

9390, the the 38.2% retracement level of the entire 12430-7511 fall, continues to be  immediate resistance to eye.

Immediate support on the hourly chart has moved higher to 8800, with the stop-loss of which, trading longs can be held on to.

TCS will report its quarterly earnings today.