12500, 12700 ABOVE 12430; TRAIL STOP-LOSS TO 12027

 

12500, 12700 ABOVE 12430; TRAIL STOP-LOSS TO 12027

 

WORLD MARKETS

 

Dow fell 0.2% while S & P 500 and Nasdaq ended little changed on Friday, looking for clarity around election results.

 

While, according projections, democratic nominee Joe Biden was leading votes were still being counted in several key states including Nevada, Arizona, Pennsylvania and Georgia.

 

The U.S. economy added 638,000 jobs last month, topping an estimate of 530,000. Unemployment rate fell to 6.9% in October from 7.9% in September.

 

In Europe, FTSE inched up 0.1% while DAX and CAC fell 0.7% and 0.5% respectively.  Italy recorded its highest daily death toll since April on Thursday and Italian regions entered partial lockdowns under the government’s new tiered system. Greece also announced a national lockdown. Germany’s industrial output grew by 1.6%, below a forecast of 2.7%.

 

US indices notched their best weekly performance since April, rising 6.9%-9%. European markets surged 6-8%. Asian equities climbed 2.7%-6.7%.

 

Later, on Saturday, Biden was projected to win Pennsylvania as well as Nevada, taking his tally to 290 and making him the winner of the elction. However, Trump refused to concede and said that as soon as Monday his team will start “prosecuting our case in court to ensure election laws are fully upheld.”

 

Meanwhile, U.S. reported more than 126,000 new cases of the coronavirus two days in a row and has reported a new record daily spike in cases every day over the past four days.

 

AT HOME

 

It was a strong finish to solid week as Sensex and Nifty climbed 1.3% and 1.2% respectively, extending the winning streak to fifth straight day and closing at the highest level since 17th January. Sensex settled at 41893, up 552 points while Nifty added 143 points to finish at 12263. BSE mid-cap and small-cap indices rose 0.4% and 0.5% respectively. BSE Energy index climbed 3.2%, becoming top gainer among the sectoral indices, followed by 1.8% higher Bankex and Finance indices. Telecom and Healthcare indices were the top losers, down 0.9% and 0.6% respectively.

 

FIIs net bought stocks and index futures worth Rs 4870 cr and 521 cr respectively but net sold stock futures worth Rs 23 cr. DIIs were net sellers to the tune of Rs 2939 cr.

 

Rupee appreciated 19 paise to end at 74.20/$.

 

For the week, Sensex and Nifty soared 5.8% and 5.3% respectively, registering the biggest weekly gain in 5 months and closing at the highest level since the week ended 17th January.

 

OUTLOOK

 

Today morning, Asian markets are trading with gains of 1%-2% and SGX Nifty is suggesting around 160 points higher start for our market. US futures are up 1.2%-2%.

 

Readers would recall that we had turned our view on Nifty bullish after 11770 hurdle was taken out and have been advising holding on to long positions with the trailing stop-loss. Afer 12025 hurdle was taken out, we had given next target of 12246, which was achieved on Friday as Nifty soared to close at 12263. The benchmark is set to open above 12400 today.

 

12430, the top made in January, is the next upside target above which 12500 would be the next level to eye. Once 12500 is taken out, 12700, where a rising trendline adjoining tops made in August 2018 and June 2019 is placed, would be the next major target/resistance to eye.

 

On the way down, 12027-11930, the gap created by gap-up opening on Thursday, would be the support zone. Meanwhile, long positions can be held on to with the stop-loss of 12027.