TRAIL STOP-LOSS TO 20750

 

TRAIL STOP-LOSS TO 20750

 

WORLD MARKETS

 

U.S. indices gained 0.4% each on Friday, after the November jobs report and University of Michigan consumer survey data signaled a resilient economy and cooling inflation, fueling hopes for a "soft landing" scenario.

 

November’s nonfarm payrolls report showed the economy added 199,000 jobs, slightly ahead of the 190,000 estimate and well ahead of the 150,000 jobs added in October. The jobless rate fell to 3.7% in November from 3.9% the prior month.  Average hourly earnings, seen as a leading indicator of inflation, rose about as expected. Meanwhile, a closely watched University of Michigan survey showed inflation expectations drop and consumer sentiment jump in December to it highest level since July.

 

U.S. 10-year treasury yield rose 7 bps to 4.229%. Dollar index rose a third of a percent to 103.98. Gold slipped 1.2% to $2004 per ounce.

 

The WTI contract for January rose 2.7% to settle at $71.23 a barrel while Brent crude for February gained 2.4% to $75.84 a barrel.

 

European markets gained 0.5%-1.3%.

 

Earlier, Japan’s third-quarter GDP was revised downward to a 0.7% fall q-o-q, a sharper slide compared with the 0.5% decline estimated earlier.

 

For the week, Dow ended marginally higher, S & P 500 inched up 0.2% while Nasdaq rose 0.7%, all extending the winning streak to sixth consecutive week.

 

AT HOME

 

Sensex and Nifty gained 0.4% and 0.3% respectively, hitting fresh record highs. Sensex settled at 69825, up 303 points while Nifty added 68 points to finish at 20969. Nifty mid-cap and small-cap indices however fell 0.2% and 1.1% respectively, snapping 25-day and 10-day winning streak. Nifty IT index was the top gainer among the sectoral indices, up 1.3%, followed by 0.9% higher Bank and Financial Services indices

 

FIIs net bought stocks, index futures and stock futures worth Rs 3632 cr, 360 cr and 228 cr respectively. DIIs were net sellers to the tune of Rs 434 cr.

 

Rupee depreciated 4 paise to end at 83.39/$.

 

For the week, Sensex and Nifty surged 3.5% each, extending the winning streak to sixth straight week and posting highest weekly gain since the week ended 22^nd July 2022.

 

The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) unanimously decided to keep rep rate unchanged at 6.5%, raised its GDP growth projection for 2023-24 to 7% from 6.5%, and retained its average inflation forecast at 5.4%. The MPC also decided by a majority of 5:1 to remain focused on the withdrawal of accommodation to ensure that inflation aligns to the target, while supporting growth.

 

OUTLOOK

 

China's November CPI fell 0.5% y-o-y, more than the 0.1% drop expected and the fastest slide since November 2020. The producer price index fell 3% y-o-y, compared with October’s 2.6% drop and expectations of a 2.8% decline. It also marked the 14th straight month of PPI decline and the quickest since August.

 

Today morning, Nikkei is up 1.7% while Hang Seng and Shanghai are down 1.4% and 1% respectively. GIFT Nifty is suggesting a flattish start for our market.

 

In Friday's report we had said that 21050 continued to be next upside level to eye while 20525 continued to be immediate support, with the stop-loss of which, trading longs could be held on to.

 

Nifty rose to touch a high of 21006 before closing at 20969.

 

21050-21100 is the next target area, above which, 21550, around which the upper end of a rising channel formation is placed, is the next upside target to eye; 20750 is the immediate support on the hourly chart, with the stop-loss of which, trading longs can be held on to.

 

For Banknifty, 48000, around which a rising trendline adjoining tops made in December 2022 and July 2023 is placed, is the next upside target, above which, 50000 would be the major target to eye; 46500 is the immediate support on the hourly chart, with the stop-loss of which, trading longs can be held on to.

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