ALL EYES ON THE FED

 

ALL EYES ON THE FED

 

WORLD MARKETS

 

After opening with gains of nearly a percent, Dow and S & P 500 slipped to end marginally in the red while Nasdaq managed to gain 0.2%.

 

Fed finishes its two-day policy meeting today and markets are awaiting cues on central bank’s plans to taper its bond buying. The Fed will also release its quarterly economic forecasts, the so-called dot plot, along with the statement on interest rates. Fed Chair Powell will have a press conference after the announcements.

 

US 10-year treasury yield ticked up 1.4 basis points to trade at 1.323%. Dollar index was down nearly 0.1% at 93.233. Spot gold rose 0.7% to $1,776 per ounce.

 

Brent crude gained 44 cents, or 0.6%, to settle at $74.36 per barrel and WTI future gained 27 cents, or 0.4%, to settle at $70.56.

 

European markets gained 1.1%-1.5%.

 

AT HOME

 

After falling four tenth of a percent, benchmark indices soared 1.4% from the bottom of the day to end higher by nearly a percent, recouping most of the yesterday's losses. Sensex settled at 59005, up 514 points while Nifty added 165 points to finish at 17562. Nifty mid-cap index gained 0.6% but small-cap index fell 0.1%. BSE Realty and Metal indices climbed 3.5% and 2.6% respectively, becoming top gainers among the sectoral indices, while Utilities and Power indices were the top losers, down 0.6% and 0.5% respectively.

 

FIIs net bought stocks and index futures worth Rs 1042 cr and 284 cr respectively but net sold stock futures worth Rs 177 cr. DIIs were net buyers to the tune of Rs 2168 cr.

 

Rupee appreciated 12 paise to end at 73.61/$.

 

OUTLOOK

 

Markets in Hong Kong and South Korea are closed today for holidays. Other Asian markets are trading with cuts of 0.2%-0.4%. SGX Nifty is suggesting a flattish start for our market.

 

In yesterday's report we had said that 17300-17250 continued to be next support zone while 17623, the top made Monday, was the immediate hurdle.

 

Nifty, after touching a low of 17326, reversed to touch a high of 17578 before closing at 17562.

 

17623, the top made Monday, continues to be the immediate hurdle, above which, 17793, the top made last week, would be the bigger resistance to eye; 17300-17250 continues to be support zone.

 

37450-37500 is the immediate resistance zone for Banknifty, upon crossover of which, 37800, 38100 would be subsequent upside levels to eye; 36350-36150 is the support zone.