14862 IS THE IMPORTANT SUPPORT; 15336 IMMEDIATE HURDLE

 

14862 IS THE IMPORTANT SUPPORT; 15336 IMMEDIATE HURDLE

 

WORLD MARKETS

 

Dow and S & P 500 rose 0.9% and 0.1% respectively while Nasdaq fell 0.6% on Friday as cyclical stocks rose on rising reopening optimism while surging bond yields weighed on tech names. Dow hit a fresh record while S & P 500 eked out a record close.

 

The 10-year Treasury yield jumped 10 bps to 1.64%, hitting highest level since February 2020, before easing to 1.626%.

 

Data showed U.S. producer prices (PPI) had their largest annual gain in nearly 2-1/2 years.

 

Biden announced he would direct states to make all adults eligible for the vaccine by May.

 

The dollar index rose 0.25% to 91.668. Spot gold rose 0.2% to $1,724.16 per ounce.

 

Brent crude futures slipped 13 cents, or 0.2%, to $69.50 a barrel while WTI fell 14 cents, or 0.26% to $65.88 a barrel.

 

In Europe, FTSE and CAC rose 0.4% and 0.2% respectively while DAX slipped half a percent. The U.K. economy shrank by 2.9% in January from the previous month, a less severe contraction than expected.

 

AT HOME

 

After rising a percent at the open, benchmark indices saw a sharp reversal through the session to end lower by a percent, snapping 3-day winning streak. Sensex settled at 50792, down 487 points while Nifty lost 143 points to finish at 15030. Nifty mid-cap index fell 0.4% but small-cap index rose 0.5%. BSE Auto and Energy indices tumbled 1.6% and 1.4% respectively, becoming top losers among the sectoral indices while Utilities and Power indices were the top gainers, up 1.3% and 0.7% respectively.

 

The reversal happened after yield on the benchmark U.S. 10-year Treasury note rose again, briefly hitting 1.6%.

 

FIIs net sold stocks, index futures and stock futures worth Rs 943 cr, 586 cr and 1357 cr respectively. DIIs were net sellers to the tune of Rs 164 cr.

 

Rupee appreciated 12 paise to close at 72.78/$.

 

For the week, Sensex and Nifty gained 0.8% and 0.6% respectively, extending the winning streak to second straight week.

 

The retail inflation, measured Consumer Price Index (CPI), rose to 5.03% in February, up from 4.06% in January and hitting a 3-month high. Separately, the factory output, measured in terms of Index of Industrial Production (IIP), contracted by 1.6% in January as against expansion of 1% in December.

 

OUTLOOK

 

Today morning, except half a percent lower Shanghai, other Asian markets are trading with gains of 0.3%-0.7% and SGX Nifty is suggesting around 60 points higher start for our market.

 

In Friday's report we had said that 15431, the top made on 16th February, was the next upside target and had suggested trailing stop-loss in long positions to 15060.

 

Nifty, after touching a high of 15336 in the initial trade, plunged to 14953 before closing at 15030. The benchmark is set to open near 15100 today.

 

15336, the top made on Friday, would work as immediate hurdle, upon crossover of which, 15431, the top made on 16th February, would be the next upside level to eye.

 

14862, the bottom made on 5th March, which also roughly coincides with the 34-DMA, is the next important support to eye.