TRAIL STOP-LOSS TO 17100

 

TRAIL STOP-LOSS TO 17100

 

WORLD MARKETS

 

Dow fell 0.2%, S & P 500 was little changed while Nasdaq gained 0.2% on Friday after the August jobs report came in short of expectations, showing the impact of the delta-fueled Covid resurgence.

 

Nonfarm payrolls increased by 235,000 in August, missing the expected 7,20,000 number by a wide margin and marking a significant slowdown from July’s revised number of 1.053 million. The unemployment rate dropped to 5.2% from 5.4%, in line with estimates. Average hourly earnings showed a strong 0.6% rise month over month.

 

US 10-year treasury yield gained 3 bps to 1.322%. Dollar index fell 0.2% to 92.03. Spot gold climbed 1.2% to $1,830.71 per ounce, its highest since mid-June.

 

Brent crude rose 0.5% to $73.42 a barrel while WTI crude futures were up 21 cents or 0.3% to $70.20 a barrel.

 

China's Caixin/Markit services PMI came in at 46.7, against July’s reading of 54.9. Earlier this week, the official non-manufacturing PMI for August showed contraction in the sector for the first time since early 2020.

 

In Europe, FTSE and DAX fell 0.4% each while CAC plunged 1.1%. Eurozone final IHS Markit composite PMI dropped to 59.0 from July’s 15-year high of 60.2.

 

For the week, Dow fell 0.2% while Nasdaq and S & P 500 gained 1.6% and 0.6% respectively. In Europe, FTSE and DAX fell 0.1% and 0.4% respectively while CAC inched up 0.1%. In Asia, Nikkei and Nifty soared 5.4% and 3.7% respectively while Hang Seng and Shanghai were up 1.9% and 1.7% respectively.

 

AT HOME

 

Record run continues as benchmark indices added another half a percent to hit fresh record highs. Sensex settled at 58129, up 277 points while Nifty added 89 points to finish at 17323. Nifty mid-cap and small-cap indices gained 0.5% and 0.4% respectively with the former hitting fresh record high. BSE Energy and Oil & Gas indices soared 3.6% and 2.2% respectively, becoming top gainers among the sectoral indices while Telecom index was the top loser, down 0.5%, followed by 0.2% lower Finance, FMCG and Bankex indices.

 

FIIs net bought stocks worth Rs 769 cr but net sold index futures and stock futures worth Rs 742 cr and 593 cr respectively. DIIs were net buyers to the tune of Rs 669 cr.

 

Rupee appreciated 4 paise to end at 73.02/$.

 

For the week, Senesx and Nifty gained 3.6% and 3.7% respectively.

 

OUTLOOK

 

Today morning, Nikkei is trading with gains of 1.5% while Hang Seng and Shanghai are up nearly half a percent. SGX Nifty is suggesting around 40 points higher start for our market.

 

Readers would recall that we had turned our view bullish after 15950 hurdle was taken out and have been advising holding on to long positions with a trailing stop-loss.

 

On Friday, we had said that 17350-17400 was the next target zone to eye and had advised trailing the stop-loss in long positions to 16990.

 

Nifty touched the high of 17340 before closing at 17323 and is set to open above 17350 today.

 

17400, where an upward sloping trendline adjoining recent tops on the hourly chart is placed, is the next upside target to eye. Above 17400, 17650, which is the target of the flag pattern breakout that happened in early August, would be the next upside level to eye.

 

Immediate support on the hourly chart has moved up to 17100, with the stop-loss of which, trading longs can be held on to.

 

For Banknifty, above Friday's high of 37140, 37708, the top made in February, would be the next upside target to eye; 36400 is the immediate support, with the stop-loss of which, trading longs can be held on to.