14900 ABOVE 14653; 14320 CONTINUES TO BE IMMEDIATE SUPPORT

 

14900 ABOVE 14653; 14320 CONTINUES TO BE IMMEDIATE SUPPORT

 

WORLD MARKETS

 

After a positive start US indices slipped to end with cuts of 0.1%-0.4%  on the back of weak economic data.

 

Jobless claims jumped to its highest since last August at 965,000 last week, more than the expected figure of 800,000  and previous week's 787,000 number.

 

Fed Chair Powell said an interest rate hike is coming “no time soon” and pushed back against suggestions that the central bank might start tapering its bond purchases any time soon.

 

In the evening, President-elect Joe Biden announced details of a $1.9 trillion stimulus plan which includes increasing the additional federal unemployment payments to $400 per week and extending them through September, direct payments to many Americans of $1,400, and extending the federal moratoriums on evictions and foreclosures through September. The plan also calls for $350 billion in aid to state and local governments, $70 billion for Covid testing and vaccination programs and raising the federal minimum wage to $15 per hour.

 

10-year Treasury yield gained 4 basis points to 1.129%, while the yield on the 30-year Treasury bond rose 6 bps to 1.876%. Dollar index fell 0.2%. Spot gold rose 0.8%.

 

Brent crude rose 26 cents, or 0.5%, to $56.32 a barrel WTI crude settled 66 cents, or 1.25%, higher at $53.57 per barrel.

 

In Europe, FTSE rose 0.8% while DAX and CAC were up a third of a percent. The German economy shrank by 5% in 2020, according to preliminary data, slightly beating the -5.1% expectation.

 

Earlier, Chinese trade data for December showed the country’s exports rose 18.1% in December, higher than expectations for a 15% increase. Imports grew 6.5%, as compared with expectations for a 5% rise.

 

AT HOME

 

Benchmark indices rose a fifth of a percent, making fresh record highs on closing basis. Sensex settled at 49584, up 91 points while Nifty added 30 points to finish at 14595. Nifty mid-cap and small-cap indices rose 0.1% and 0.6% respectively. BSE Capital Goods and Oil & Gas indices climbed 1.7% and 1.4% respectively, becoming top gainers among the sectoral indices while Metal index slipped 1.2%, becoming top loser, followed by 0.6% lower Basic Materials index.

 

FIIs net bought stocks and index futures worth Rs 1077 cr and 9 cr respectively but net sold stock futures worth Rs 569 cr. DIIs were net sellers to the tune of Rs 188 cr.

 

Rupee appreciated 10 paise to end at 73.04/$.

 

December WPI inflation came in at 1.22%, down from 1.55% in the previous months.

 

OUTLOOK

 

Today morning, Shanghai is marginally higher while Nikkei and Hang Seng are down a fifth of a percent each. SGX Nifty is suggesting around 60 points lower start for our market.

 

In yesterday's report we had said that 14900, around which an upward sloping trendline adjoining tops made in 2010 and 2015 is placed, is the next major target as well as resistance to eye and had advised trailing stop-loss in long positions to 14320.

 

Nifty touched a high of 14617 before closing at 14595 and is set to open below 14550 today.

 

14653, the top made Wednesday, is the immediate hurdle to eye, upon crossover of which, 14900-15000, around which an upward sloping trendline adjoining tops made in 2010 and 2015 is placed, would be next major target as well as resistance to eye.

 

14320 continues to be immediate support, with the stop-loss of which, trading longs can be held on to.

 

HCL Tech will report its quarterly earnings today.