TRAIL SL TO 11730

 

TRAIL SL TO 11730

 

WORLD MARKETS

 

US indices gained 0.6%-1.4% as President Trump signaled support for a bigger coronavirus aid package.

 

Trump, in a media interaction, said he “would like to see a bigger stimulus package frankly than either the Democrats or Republicans are offering.” Trump also tweeted on Friday that “Covid Relief Negotiations are moving along. Go Big!”

 

Brent futures fell 49 cents, or 1.13%, to settle at $42.85 per barrel, while WTI crude settled 59 cents, or 1.4%, lower at $40.60 per barrel.

 

In Europe, FTSE and CAC rose 0.7% each while DAX was little changed.  U.K. economy grew 2.1% in August on a monthly basis, well below expectations of a 4.6% expansion.

 

For the week, the Dow jumped 3.3%  for its biggest one-week gain since August. The S&P 500 and Nasdaq were up 3.8% and 4.6%, respectively, and had their best weekly performance since early July.  WTI as well as Brent climbed nearly 10%, snapping two-week losing streak.

 

AT HOME

 

Sensex and Nifty gained 0.8% and 0.7% respectively, extending the winning streak to seventh straight day and closing at the highest level since 20th February. Sensex settled at 40509, up 326 points while Nifty added 80 points to finish at 11914. BSE mid-cap and small-cap indices however fell 0.4% and 0.3% respectively. BSE Bankex climbed 2.6%, becoming top gainer among the sectoral indices, followed by 1.8% higher Finance index. Realty and Healthcare indices were the top losers, down 1.6% and 1% respectively.

 

FIIs net sold stocks and stock futures worth Rs 39 cr and 1040 cr respectively but bought index futures worth Rs 739 cr. DIIs were net buyers to the tune of Rs 127 cr.

 

Rupee appreciated 8 paise to end at 73.16/$.

 

For the week, Senex and Nifty gained 4.7% and 4.4% respectively, extending the rising streak to second straight week and closing at the highest level since the week ended 20th February.

 

RBI, while left the key rates unchanged, unleashed slew of measures to boost liquidity. The newly-appointed MPC voted unanimously to keep the policy repo rate unchanged at 4% and maintained "accommodative" stance, and said the real GDP growth rate in 2020-21 could be a negative 9.5%, with “risks tilted to the downside.” Retail inflation is expected to remain elevated in September but ease over Q3 and Q4.

 

Liquidity boosting measures included commitment to conduct adequate OMOs, first time OMOs of state loans and On Tap TLTROs. RBI also rejigged home loan rules by linking home loan risk weights to the up front money the borrower brings.

 

OUTLOOK

 

Today morning, Hang Seng and Shanghai are up 1.4% and 1.2% respectively while Nikkei is off 0.2%. SGX Nifty is suggesting around 75 points higher start for our market.

 

Readers would recall that we had initiated positive view on Nifty after 11225 hurdle was taken out and have been advising holding on to long positions with a trailing stop-loss.

 

After 11794 target was achieved, we have been working with next upside target of 12000.

 

Nifty, on Friday, touched a high of 11938 before closing at 11914 and is set to open near 12000 today.

 

12000 continues to be immediate upside target, upon crossover of which 12246, the top made in February, would be the next target to eye.

 

Immediate support on the hourly chart has moved up to 11730, with the stop-loss of which, trading longs should be held on to.