19450 BELOW 19563; 19867 IS IMMEDIATE HURDLE

 

19450 BELOW 19563; 19867 IS IMMEDIATE HURDLE

 

WORLD MARKETS

 

U.S. indices gained 0.5%-1.9% on Friday as June data for the personal consumption expenditures price index continued to show easing inflation.

 

June Core Personal Consumption Expenditure rose 4.1% y-o-y, lower than the anticipated 4.2%. Month-on-month increase of 0.2% was in-line with estimate.

 

U.S. 10-year treasury yield fell 5 bps to 3.953%. Dollar index was flat at 101.70. Gold rose 0.7% to $1959 per ounce. Bank of Japan made its yield curve control policy more flexible, which markets took as a step towards an eventual shift in its massive stimulus program.

 

Brent crude settled 75 cents higher to $84.99 a barrel, while WTI crude gained 49 cents to $80.58 a barrel.

 

In Europe, FTSE was little changed while DAX and CAC gained 0.4% and 0.2% respectively.

 

For the week, U.S. indices gained 0.7%-2% with the Dow and S&P 500 closing out their third winning weeks in a row.

 

AT HOME

 

Benchmark indices ended marginally lower after a volatile session, extending the losing streak to second straight day. Sensex settled at 66160, down 106 points while Nifty lost 14 points to finish at 19646. Nifty mid-cap and small-cap indices gained 0.6% and 0.2% respectively with the former extending the winning streak to fourth straight day and hit fresh record high. Nifty Realty and Media indices surged 1.8% and 1.4% respectively, becoming top gainers among the sectoral indices. IT and Bank indices were the top losers, down 0.9% and 0.5% respectively.

 

FIIs net sold stocks, index futures and stock futures worth Rs 1024 cr, 1802 cr and 61 cr respectively. DIIs were net buyers to the tune of Rs 1634 cr.

 

Rupee depreciated 32 paise to end at 82.25/$.

 

For the week, Sensex and Nifty fell 0.8% and 0.5% respectively, snapping a 4-week winning streak.

 

Marico results were largely in-line with estimate and management commentary was positive. NTPC reported muted revenue growth but margins rose to 29% from 24.3% y-o-y.

 

OUTLOOK

 

Today morning, Nikkei and Hang Seng are up 1.8% each and Shanghai is up a percent. GIFT Nifty is suggesting around 40 points higher start for our market.

 

In Friday's report we had said that 20-DMA, placed around 19580 was the next support for Nifty below which 19450, the 78.6% retracement level of the recent 19303-19991 upmove, would be next downside target.

 

Nifty, after touching a low of 19563, rebounded to end at 19646.

 

19563, the bottom made Friday, roughly coincided with 20-DMA, and hence is the immediate support to eye. Below, 19563, 19450, the 78.6% retracement level of the recent 19303-19991 upmove, would be the next downside target. 19867, the top made during last week, is the immediate hurdle, above which, 19991, the top made on 20th July, would be bigger resistance to eye.

 

For Banknifty, 45238, the low made Friday, coincided with the 61.8% retracement level of the recent 44547-46370 upmove and hence is the immediate support to eye. Below this level, 44937, the 78.6% retracement level of this upmove, would be next downside target. On the way up, 45850-45950 is the immediate resistance zone, above which, 46370, the top made last week, which was nearly retested this week, would be bigger hurdle to eye.

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