LOWER STOP-LOSS TO 14910

 

LOWER STOP-LOSS TO 14910

 

WORLD MARKETS

 

US indices fell 0.5%-3%, with Nasdaq leading the losses as a spike in bond yields fueled concern about equity valuations particularly in high growth tech stocks. Bank stocks rose on higher yields while Energy stocks slipped as oil tumbled.

 

The 10-year Treasury yield jumped 11 bps above 1.75% at its day high, hitting its highest level since January 2020, before easing to 1.719%. The 30-year rate rose 6 bps at session high, breaching the 2.5% level for the first time since August 2019. The jump in bond yields came after the Fed expressed its willingness to allow an overshoot in inflation.

 

Weekly initial jobless claims totaled 770,000 for the week ended March 13, worse than an estimate of 700,000. Philadelphia Fed manufacturing index, at 51.8, well exceeded consensus of 22.0 and hit the highest level since 1973.

 

Both Brent and WTI oil plunged nearly 7% to settle at $63.28 and $60 per barrel respectively, extending the losing streak to fifth straight day on the back of a stronger dollar, a further increase in U.S. crude and fuel inventories and a slowdown in some vaccination programmes and the prospect of more restrictions to control the coronavirus.

 

The U.S. dollar index rose 0.53% to 91.853. Spot gold fell 0.7% to $1,732.99 an ounce

 

European markets rose 0.1%-1.2% with DAX on the top.

 

AT HOME

 

After opening higher by a percent, benchmark indices nosedived nearly 2% from the top of the day to end lower by more than a percent, extending the losing streak to fifth straight day and closing at the lowest level after 26th February. Sensex settled at 49216, down 585 points while Nifty lost 163 points to finish at 14557. Nifty mid-cap and small-cap indices fell 1.4% and 1.3% respectively. Except 0.2% higher FMCG index, all the BSE sectoral indices ended in red, with IT and Teck indices leading the losses, down 3% and 2.5% respectively.

 

The sell-off happened on the back of resurgence in US treasury yields with the 10-year yield hitting a high of 1.74%.

 

FIIs net bought stocks, index futures and stock futures worth Rs 1258 cr, 361 cr and 859 cr respectively. DIIs were net sellers to the tune of Rs 1116 cr.

 

Rupee appreciated 1 paise to end at 72.53/$.

 

OUTLOOK

 

Today morning, Asian markets are trading with cuts of about three fourth of a percent. SGX Nifty is suggesting around 70 points lower start for our market.

 

Readers would recall that we had turned our view on Nifty negative after 15060 was breached and have been advising holding on to short positions with a trailing stop-loss.

 

In yesterday's report we had said that 14696, the low made Wednesday, was the immediate support and had advised trailing stop-loss in short positions to 14990.

 

Nifty, after touching a high of 14875 in the initial trade, reversed, broke 14696 and plunged all the way to 14478 before closing at 14557.

The benchmark is set to open near 14500 today.

 

14478, the low made yesterday, also coincides with the 14467 bottom made on 26th February. Below 14467, 14336, the lower end of the gap created by gap-up opening on 2nd February, would be the next downside level to eye.

 

Immediate hurdle on the hourly chart has moved to 14910, with the stop-loss of which, trading shorts can be held on to.