NIFTY TESTS IMMEDIATE SUPPORT

 

NIFTY TESTS IMMEDIATE SUPPORT

 

WORLD MARKETS

 

US indices ended higher by 0.6%-1.5% after digesting minutes from the latest Fed meeting.

 

Minutes from May Fed meeting showed that officials are prepared to move ahead with several 50 bps interest rate hikes. FOMC also said policy may have to move away from “neutral” and into “restrictive” territory. Data showed new orders for U.S.-made capital goods rose less than expected in April.

 

Nvidia dropped more than 6% in extended trading after the company delivered weaker-than-expected guidance for the second quarter.

 

US 10-year treasury yield was little changed at 2.749%. Dollar index rose 0.3% to 102.07. Gold slipped 0.8% to $1852 per ounce, snapping a five-session winning streak.

 

Brent crude rose 0.6% to $114.37 per barrel and WTI crude inched up 0.4% to $110.67. Natural gas surged above $9 per MMBtu, hitting the highest level in more than a decade.

 

European markets rose 0.5%-1.6%. German GDP grew 0.2% in the first quarter of 2022, narrowly avoiding a recession on the back of strong construction and machinery investments.

 

AT HOME

 

After gaining six tenth of a percent at the open, benchmark indices saw an exact reversal through the session to end lower by six tenth of a percent, extending the losing streak to third straight day. Sensex settled at 53749, down 303 points while Nifty finished at 16025, down 99 points. Nifty mid-cap and small-cap indices tumbled 2.4% and 3.5% respectively, with the latter suffering worst cut in 3-months and closing at the lowest level after 5^th May 2021. Except 0.3% and 0.2% higher Finance and Bankex indices, all the BSE sectoral indices ended in red, with IT and Realty indices leading the losses, down 3.2% and 3% respectively.

 

FIIs net sold stocks worth Rs 1158 cr but net bought index futures and stock futures worth Rs 1158 cr and 164 cr respectively. DIIs were net buyers to the tune of Rs 125 cr.

 

Rupee appreciated 6 paise to end at 77.52/$.

 

Asian Paints tumbled on fears of competition after Grasim Industries doubled the capital expenditure for its foray into the paints business to Rs 10,000 crore.

 

OUTLOOK

 

Today morning, Nikkei is up 0.1% but Hang Seng and Shanghai are down 0.8% and 0.6% respectively. SGX Nifty is suggesting around 90 points higher start for our market.

 

In yesterday's report we had said that 16003, the low made Friday, continued to be immediate support, while 16414, the top made Monday, continued to be immediate hurdle.

 

Nifty, after touching a low of 16006, closed at 16025 and is set to open near 16100 today.

 

16003, the low made Friday, continues to be immediate support, upon breach of which, 15735, the low made on 12th May, would be the next downside level to eye; 16414, the top made Monday, continues to be immediate hurdle.

 

For Banknifty, 34820, the top made Monday, continues to be immediate hurdle, upon crossover of which, 35133, the upper end of the gap created by gap-down opening on 6th May, would be the next upside level to eye; 33658, the low made Friday, is the immediate support, below which, 33000 would be the next downside level to eye.

 

Hindalco and Coal India will report their quarterly earnings today.