NIFTY SET TO ACHIEVE 16450; 16570 NEXT

 

NIFTY SET TO ACHIEVE 16450; 16570 NEXT

 

WORLD MARKETS

 

US indices soared 2.4%-3.1% following strong earnings reports.

 

Bank shares outperformed with Goldman Sachs, Bank of America and Wells Fargo climbing 3.4%-5.6%. Shares of IBM fell 5.3% after the tech company lowered its forecast for cash flow. Johnson & Johnson reported better-than-expected top and bottom line but cut full-year revenue and profit guidance on stronger dollar.

 

U.S. housing starts fell 2% in June to a seasonally adjusted annual rate of 1.559 million units.

 

US 10-year treasury yield rose 4 bps to 3.03%. Dollar index slipped 0.7% to 106.68. Euro gained 0.8% against the dollar as markets priced in a higher probability of a 50 bps hike from ECB on Thursday. Gold inched up 0.1% to $1711 per ounce.

 

Brent crude futures finished the day 1% higher at $107.35 a barrel and WTI crude settled 1.6% higher at $104.22 per barrel.

 

European markets gained 1%-2.7%.

 

AT HOME

 

After starting nearly half a percent lower, benchmark indices reversed these losses through the session to end higher by four tenth of a percent each, extending the winning streak to third straight day. Sensex settled at 54767, up 246 points while Nifty added 62 points to finish at 16340. Nifty mid-cap and small-cap indices climbed 0.7% and 1% respectively. Except 0.3% lower Oil & Gas index, all the BSE sectoral indices ended higher, with Realty index on the top, up 2.7%, followed by 1% higher Bankex.

 

FIIs net bought stocks and index futures worth Rs 976 cr and 310 cr respectively but net sold stock futures worth Rs 815 cr. DIIs were net sellers to the tune of Rs 101 cr.

 

Rupee appreciated 3 paise to end at 79.94/$.

 

HUL reported all-round beat as far as quarterly results were concerned however management commentary lacked optimism. Ambuja Cement revenue beat estimate while margins were in-line with estimates.

 

OUTLOOK

 

Today morning, Asian markets are trading with gains of 0.4%-2.4% with Nikkei on the top. SGX Nifty is suggesting around 170 points higher start for our market.

 

In yesterday's report we had said that 16450, the 78.6% retracement level of the 16794-15183 fall, was the next upside level to eye and had adivsed holding on to long positions with the stop-loss of 16060.

 

Nifty surged to touch a high of 16359 before closing at 16340 and is set to open near 16500 today.

 

16570, around which a rising trendline adjoining recent tops on daily chart is placed, is the next upside level to eye; 16100 is the immediate support, with the stop-loss of which, trading longs can be held on to.

 

35950-36100 is the next target zone for Banknifty, above which 200-DMA, placed around 36400, would be next upside level to eye; 35000 is immediate support.

 

Wipro and Indusind Bank will report their quarterly earnings today.