19600 BELOW 19710; 20000 IS IMMEDIATE HURDLE

 

19600 BELOW 19710; 20000 IS IMMEDIATE HURDLE

 

WORLD MARKETS

 

U.S. indices nosedived 1.1%-1.8%, notching a third straight day of losses as Treasury yields surged to multiyear highs and investors Markets also became concerned about a government shutdown.

 

Weekly jobless claims decreased by 20,000 to an eight-month low of 201,000 for the week ending Sept. 16, much lower than the 225,000 claims expected.

 

House Republican leaders sent the chamber into recess, bolstering fears that federal lawmakers won’t pass a bill to avert a government shutdown.

 

U.S. 10-year treasury yield rose 8 bps to 4.496%. Dollar index fell 0.1% to 105.38. Gold fell 0.6% to $1920 per ounce.

 

Brent futures for November delivery settled down 23 cents to $93.30 a barrel, while WTI crude settled down 3 cents to $89.63.

 

European markets fell 0.7%-1.8%. The Bank of England keeping the policy rate at 5.25%, pausing its hiking cycle. The Swedish and Norwegian central banks both opted to hike interest rates, while the Swiss National Bank paused its hiking cycle.

 

AT HOME

 

Benchmark indices fell 0.8% each, extending the losing streak to third straight day and closing at the lowest level after the first week of this month. Sensex lost 570 points to settle at 66230 and Nifty finished at 19742, down 159 points. Nifty mid-cap and small-cap indices fell 0.9% and 1.3% respectively. Except 0.03% higher Media index, all the NSE sectoral indices ended lower, with Bank and Financial Services indices leading the losses, down 1.7% each.

 

Rupee depreciated 2 paise to end at 83.09/$.

 

FIIs net sold stocks, index futures and stock futures worth Rs 3007 cr, 880 cr and 856 cr respectively. DIIs were net buyers to the tune of Rs 1158 cr.

 

JP Morgan will add India to its emerging-market bond index from June 2024.

 

OUTLOOK

 

Today morning, Nikkei is down a percent but Hang Seng and Shanghai are modestly higher. GIFT Nifty is suggesting nearly 100 points lower start for our market.

 

In yesterday's report we had said that 19840 and 19723, the 38.2% and 50% retracement levels of the recent 19223-20222 upmove, were the next downside levels to eye and had advised holding on to short positions with the stop-loss of 20100.

 

Nifty plunged all the way to 19710 before closing at 19742, achieving both the targets mentioned above and vindicating our view.

 

19710, the low made yesterday, around which 20-DMA has also progressed, is the immediate support, upon breach of which, 34-DMA, placed around 19600, would be crucial support to eye; 20000 is the immediate resistance on the hourly chart.

 

For Banknifty, 44360, the 78.6% retracement level of the upmove seen in September, is the next downside level to eye; 45700 is immediate hurdle.

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