10885 CONTINUES TO BE IMMEDIATE HURDLE; 10630 IMMEDIATE SUPPORT

10885 CONTINUES TO BE IMMEDIATE HURDLE; 10630 IMMEDIATE SUPPORT

WORLD MARKETS

Dow and S & P 500 fell 1.4% and 0.6% respectively as coronavirus resurgence raised questions about the health of the economy moving forward. Nasdaq however gained 0.5% to hit fresh record as Amazon jumped 3% to a record.

United States reported more than 60,000 new COVID-19 infections on Wednesday, setting a single-day global record. Coronavirus-related hospitalizations hit a record in Florida. In California, the state’s daily average increase of coronavirus cases went up to a record as well.

Jobs data released by the Labor Department Thursday showed 1.314 million Americans filed for unemployment benefits last week, down from 1.43 million in the previous week.

Brent crude futures fell 90 cents, or 2%, to $42.39 per barrel while WTI futures slipped $1.3, or 3.1%, to settle at $39.62 per barrel.

In Europe, FTSE and CAC slipped 1.7% and 1.2% respectively while DAX closed flat.

AT HOME

Bulls came back with a vengeance as benchmark indices surged nearly a percent to end at fresh four-month high. Sensex settled at 36737, up 408 points while Nifty added 107 points to finish at 10813. Broader indices however underperformed with BSE mid-cap and small-cap indices rising 0.1% and 0.5% respectively. BSE Metal index climbed 2.1%, becoming top gainer among the sectoral indices, followed by 1.6% higher Finance index. FMCG index was the top loser, down 0.4%, followed by 0.3% lower Power and Capital Goods indices.

FIIs net bought stocks and index futures worth Rs 213 cr and 1331 cr respectively but net sold stock futures worth Rs 751 cr. DIIs were net sellers to the tune of Rs 804 cr.

Rupee appreciated 2 paise to end at 74.99/$.

TCS missed estimates as constant currency revenue growth declined more than expected 6.9% q-o-q, margin dipped 150 bps and profit fell 13%. The company however said that the impact of covid has bottomed out and it expects growth to come back second quarter onwards.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.3%-0.8% and SGX Nifty is suggesting around 30 points lower start for our market.

In yesterday's report we had said that 200 Day Simple Moving Average, placed around 10885, continued to be important immediate hurdle and had advised raising the stop-loss in long positions to 10630.

Nifty soared to close at 10813 and is set to open below 10800 today.

10885, where 200 Day Simple Moving Average is placed, continues to be immediate upside target as well as resistance to eye. Above 10885, 10935, where 34-month moving average is placed, would be the next target/resistance to eye.

10630 continues to be immediate support, with the stop-loss of which, trading longs can be held on to.