NIFTY ACHIEVES 13700 TARGET; 14300 IS IMMEDIATE HURDLE

 

NIFTY ACHIEVES 13700 TARGET; 14300 IS IMMEDIATE HURDLE

 

WORLD MARKETS

 

Dow and S & P 500 gained 1% each while Nasdaq rose half a percent, rebounding from worst sell-off in 3 months in Wednesday's session on concerns over heightened speculative trading.

 

Several e-brokers took steps to curb the deliberate buying of heavily shorted names such as GameStop. Concerns are that if GameStop continues to rise, it may force bigger losses at hedge funds, which in turn could cause ripples in the market as these funds are forced to sell other securities to raise cash.

 

Data showed that the U.S. economy contracted 3.5% in 2020, its sharpest pace since World War Two in 2020. Weekly jobless claims fell by 67000 to 847,000.

 

Biotech firm Novavax said that its vaccine was more than 89% effective in protecting against Covid-19.

 

Visa, Mondelez, Western Digital and Skyworks Solutions all rose in extended trading after reporting better-than-expected profits and sales for their quarterly results.

 

Brent crude for March delivery fell 27 cents, or 0.5%, to $55.54 per barrel while WTI crude settled 51 cents, or 1%, lower at $52.34 per barrel.

 

Dollar index fell 0.2% to 90.45. Spot gold fell 0.2% to $1841.40 an ounce.

 

In Europe, except 0.6% lower FTSE, other markets rose 0.3%-1.2%.

 

AT HOME

 

After plunging 1.8%, benchmark indices recouped nearly a third of the losses in late noon trade to end lower by 1.1%, extending the losing streak to fifth consecutive day and closing at the lowest level in more than a month. Sesnex settled at 46874, down 535 points while Nifty lost 150 points to finish at 13817. Nifty mid-cap and small-cap indices fell 0.6% and 0.7% respectively. BSE Realty and IT indices slipped 2.1% and 1.9% respectively, becoming top losers among the sectoral indices while Oil & Gas and Telecom indices were the top gainers, up 0.8% and 0.4% respectively.

 

FIIs net sold stocks and index futures worth Rs 3713 cr and 1389 cr respectively but net bought stock futures worth Rs 920 cr. DIIs were net buyers to the tune of Rs 1737 cr.

 

Rupee depreciated 12 paise to end at 75.04/$.

 

OUTLOOK

 

Today morning Asian markets are trading with gains of 0.2%-0.7% and SGX Nifty is suggesting around 125 points higher start for our market.

 

At the risk of repeating, we had turned our view on Nifty negative after 14490 support was breached and have been advising holding on to short positions with a trailing stop-loss.

 

In yesterday's report we had said that 13700-13800 was the next support zone to eye.

 

Nifty touched a low of 13713 before closing at 13821, nearly achieving 13700 target and vindicating our view. The benchmark is set to open near 13950 today.

 

13700 continues to be important immediate support, a breach of which would be required to initiate fresh bearish view.

 

Immediate resistance on the hourly chart has moved to 14300, a crossover of which is required to turn the near term view positive.

 

Meanwhile, positional shorts can be held on to with the stop-loss of 14300.

 

Tata Motors, Cipla, Dr Reddy, Indusind Bank, IOC, Sun Pharma, Tech Mahindra and UPL will report their quarterly earnings today.