19223 IS NEXT SUPPORT; 19600 IMMEDIATE HURDLE

 

19223 IS NEXT SUPPORT; 19600 IMMEDIATE HURDLE

 

WORLD MARKETS

 

On Monday, Dow and S & P 500 fell 0.6% and 0.2% respectively while Nasdaq rose 0.3% to snap a 4-day losing streak as Treasury yields retreated from their highs and market looked ahead to the release of corporate earnings from tech industry giants. U.S. 10-year treasury yield, after touching a high of 5.021%, reversed to end 6 bps lower at 4.852% as Pershing Square’s Bill Ackman disclosed that he had covered his bond short position.

 

U.S. indices gained 0.6%-0.9% yesterday on the back of several strong corporate earnings reports.

 

Data showed business output ticked higher in October as manufacturing pulled out of a five-month contraction and services activity accelerated modestly.

 

U.S. 10-year treasury yield fell 3 bps to 4.825%. Dollar index rose 0.6% to 106.24. Gold eased 0.1% to $1971 per ounce.

 

Oil prices fell for the third straight session on the back of soft economic data from Germany, the euro zone and Britain. Brent crude futures fell 2% to settle at $88.07 a barrel, while WTI crude futures fell 2.1% to $83.74.

 

European markets gained 0.2%-0.6%. Eurozone preliminary purchasing managers’ index for October showed an unexpected dip. German readings suggested a recession in that country is underway. Britain’s businesses reported another monthly decline in activity.

 

AT HOME

 

Sensex and Nifty plunged 1.3% each, extending the losing streak to fourth straight day, and closing at the lowest level after 28th June and 31st August respectively. Sensex lost 825 points to finish at 64571 while Nifty finished at 19281, down 260 points. For Nifty, this was the worst fall after 13^th March. Nifty mid-cap and small-cap indices nosedived 2.7% and 3.6% respectively. All the NSE sectoral indices ended in red, with Media and PSU Bank indices being the top losers, down 5% and 3.8% respectively.

 

FIIs net bought stocks and stock futures worth Rs 252 cr and 6372 cr respectively but net sold index futures worth Rs 328 cr. DIIs were net buyers to the tune of Rs 1112 cr.

 

Rupee depreciated 7 paise to end at 83.19/$.

 

OUTLOOK

 

Today morning, Hang Seng is up 2% while Nikkei and Shanghai are up 1% each. GIFT Nifty is suggesting around 30 points higher start for our market.

 

In Monday's report we had said that upon breach of 19512, 19400 would be next downside level to eye.

 

Nifty broke 19512 and plunged all the way to 19257 before closing at 19281.

 

19223, the bottom made on 31st August, is the next downside level to eye; 19600 is the immediate hurdle

 

For Banknifty, upon breach of Monday's low placed at 43029, next support will come at 42500; 43900 is immediate hurdle.

 

Axis Bank and Tech Mahindra will report their quarterly earnings today.

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