17490 IS THE IMMEDIATE HURDLE; 17161 IMMEDIATE SUPPORT

 

17490 IS THE IMMEDIATE HURDLE; 17161 IMMEDIATE SUPPORT

 

WORLD MARKETS

 

Dow and S & P 500 fell 0.3% and 0.1% respectively while Nasdaq rose 0.4%. Markets are awaiting Friday’s July jobs report, which will give the latest snapshot on the labor market and the health of the economy.

 

China fired multiple missiles near Taiwan in its biggest ever military drills in the Taiwan Strait. Japan Defense Minister said Chinese missiles landed in Japan’s exclusive economic zone and called the military drills a “serious problem,”

 

US initial jobless claims rose to 260,000 for the week ended July 30, in line with estimates. U.S. trade deficit narrowed sharply in June as exports surged to a record high.

 

US 10-year treasury yield fell around 2 bps to 2.69%. Dollar index fell 0.6% to 105.75. Spot gold jumped 1.4% to $1790 per ounce.

 

Brent crude futures ended the day 2.75% lower at $94.12 a barrel and WTI crude futures settled 2.3% lower at $88.54 per barrel.

 

In Europe, FTSE was flat while DAX and CAC gained 0.6% each. The Bank of England hiked interest rates by 50 bps, its largest single increase since 1995.

 

AT HOME

 

Benchmark indices ended marginally in the red after wild intraday swings, snapping 6-day winning streak. Sensex settled at 58298, down 51 points while Nifty lost 6 points to finish at 17382. Nifty mid-cap index rose 0.6% but small-cap index fell 0.4%. BSE Healthcare and IT indices were the top gainers among the sectoral indices, rising 1.9% and 1.2% respectively. Telecom and Realty indices were the top loser, down 1.1% each.

 

FIIs net bought stocks and stock futures worth Rs 1475 cr and 702 cr respectively but net sold index futures worth Rs 830 cr. DIIs were net sellers to the tune of Rs 47 cr.

 

Rupee depreciated 30 paise to end at 79.46/$.

 

OUTLOOK

 

Today morning, Asian markets are trading with gains of 0.2%-0.6% and SGX Nifty is suggesting around 60 points higher start for our market.

 

In yesterday's report we had said that 17487, the 78.6% retracement level of the 18115-15183 fall, continued to be upside level to eye, and had advised trailing the stop-loss in long positions to 17200.

 

Nifty, after touching a high of 17490, reversed and plunged all the way to 17161, but rebounded from there to end at 17382.

 

17490, the top made yesterday, is the immediate hurdle, upon crossover of which, 17750, around which a trendline adjoining tops made in January and April is placed, would be the next target; 17161, the low made yesterday, is the immediate support, below which, 200-DMA, placed around 17000, would be next downside level to eye.

 

For Banknifty, 38232, the top made yesterday, is the immediate hurdle, upon crossover of which, 38637, the 67% retracement levels of the entire 41830-32155 fall, would the next upside levels to eye; 37250, the low made yesterday, is the immediate support, upon breach of which, 37000-36800 would be next support area.

 

RBI's MPC will announce it's interest rate decision today and is expected to hike repo rate by 35-50 bps. As usual markets will watch out for commentary for cues to future rate trajectory.

 

M & M and Titan will report their quarterly earnings today.