16410 BELOW 16809; 17100-17300 IS THE RESISTANCE ZONE

 

16410 BELOW 16809; 17100-17300 IS THE RESISTANCE ZONE

 

WORLD MARKETS

 

After a choppy session, Dow and S & P 500 ended lower by 0.5% and 0.4% respectively while Nasdaq was absolutely flat. These moves came as markets monitored developments over Russia-Ukraine conflict and digested comments from Fed official.

 

US Secretary of State Blinken ordered the closing of the U.S. embassy in Kyiv, Ukraine, citing a “dramatic acceleration in the buildup of Russian forces” on Ukraine’s border.

 

St. Louis Fed President James Bullard, in a media interaction, said the Fed should “front-load” the tightening of its monetary policy.

 

US 10-year treasury yield rose nearly 7 bps to 1.989%. Dollar index rose 0.3% to 96.29. Spot gold climbed 0.6% to $1,871.71 per ounce.

 

Brent crude rose $2.04, or 2.2%, to $96.48 a barrel and WTI crude rose $2.36, or 2.5%, to settle at $95.46 a barrel.

 

European markets fell 1.7%-2.3%.

 

AT HOME

 

Benchmark indices nosedived 3%, suffering the worst cut in 10 months and closed at the lowest level after 21st December, 2021. Sensex settled at 56405, down 1747 points while Nifty lost 532 points to finish at 16842. Nifty mid-cap and small-cap indices collapsed 3.9% and 4.4% respectively and closed at the lowest level after August 2021, marking a 5-1/2 month low. All the BSE sectoral indices ended in red, with Realty and Metal indices leading the losses, down 5.2% and 5% respectively.

 

FIIs net sold stocks and index futures worth Rs 4254 cr and 253 cr respectively but net bought stock futures worth Rs 557 cr. DIIs were net buyers to the tune of Rs 2170 cr.

 

Rupee depreciated 22 paise to end at 75.60/$.

 

India's January CPI came in at 6.01% as against 5.59% in the previous month. Core CPI stood at 6% Vs 6.1%.

 

OUTLOOK

 

Today morning, Nikkei and Hang Seng are down 0.4% and 0.1% respectively while Shanghai is up 0.2%. US futures and modestly higher and SGX Nifty is suggesting around 80 points higher start for our market.

 

In yesterday's report we had said that 17150 was the immediate support, upon breach of which, 17043, the low made last week, would be the next support. Also, in our weekly technical report, we had said that if 17043 also gives way, 16836, the low made in January, would be the downside level to eye.

 

Nifty plunged all the way to 16809 before closing at 16842, vindicating above mentioned view.

 

16809, the low made yesterday, which also coincides with the 200-DMA, is the immediate support to eye, upon breach of which, 16410, the low made in December, would be the next downside level to eye; 17100-17300, the gap created by yesterday's gap-down opening, would act as the resistance zone.

 

36400 is the next support for Banknifty; 37800, the lower end of the gap created by yesterday's gap-down opening would be the immediate hurdle to eye.