16500-16550 IS THE NEXT TARGET ZONE; 16275 IMMEDIATE SUPPORT

 

16500-16550 IS THE NEXT TARGET ZONE; 16275 IMMEDIATE SUPPORT

 

WORLD MARKETS

 

Dow was little changed while S & P 500 and Nasdaq gained 0.3% each after digesting mixed economic data.

 

Weekly jobless claims came in at 375,000, matching estimates and declining for a third straight week. U.S. producer prices jumped by a record 7.8% y-o-y. Excluding volatile food, trade services and energy components, PPI rose 0.9% month-on-month versus a forecast for a 0.5% gain.

 

The U.S. Senate approved a $3.5 trillion budget plan.

 

The yield on the benchmark 10-year Treasury note was unchanged at 1.361%. Dollar index was 0.1% higher at 93.019. Spot gold was steady at $1,750.91 per ounce.

 

Brent crude dipped 13 cents to settle at $71.31 per barrel while WTI eased 16 cents to $69.09 per barrel as the International Energy Agency (IEA) said the spread of the Delta variant of the coronavirus would slow the global oil demand recovery.

 

In Europe, except 0.4% lower FTSE, other markets gained 0.4%-0.7%. U.K. GDP grew by a stronger-than-expected 1% in June, but remains 2.2% below its pre-pandemic level. A preliminary estimate of second-quarter GDP showed growth of 22.2% from the same period last year.

 

AT HOME

 

Sensex and Nifty surged 0.6% and 0.5% respectively and hit fresh record highs. Sensex settled at 54843, up 318 points while Nifty added 82 points to finish at 16364. Nifty mid-cap and small-cap indices too participated in the party, rising 1% and 2.1% respectively and snapping a 3-day losing streak.  Except 0.2% lower Energy index, all the BSE sectoral indices ended in green, with Utilities and Power indices leading the tally, up 3.1% and 2.6% respectively.

 

FIIs net sold stocks worth Rs 212 cr but net bought index futures and stock futures worth Rs 889 cr and 575 cr respectively. DIIs were net buyers to the tune of Rs 308 cr.

 

Rupee appreciated 18 paise to end at 74.25/$.

 

July CPI eased to 5.59% from 6.26% in June. June IIP growth stood at 13.6% as against 29.3% in May.

 

OUTLOOK

 

Today morning, Nikkei and Shanghai are little changed while Hang Seng is off half a percent. SGX Nifty is suggesting a flattish start for our market.

 

In yesterday's report we had said that 16359, the top made Tuesday, was the immediate hurdle, upon crossover of which, 16500-16550 would be the next target zone. We had also advised holding on to long positions with the stop-loss of 16146.

 

Nifty surged to touch a high of 16375 before closing at 16364.

 

16500-16550 continues to be next target zone.

 

16275 is the immediate support on the hourly chart below which, 16176-16146, the gap created by 4th August gap-up opening, would be the crucial support zone.

 

For Banknifty, 35531, the low made Wednesday, continues to be the immediate support to eye. 36317, the top made Tuesday, is the immediate hurdle, above which, 36500 and 37200 would be next targets to eye.