NIFTY TESTS 34-DMA SUPPORT

 

NIFTY TESTS 34-DMA SUPPORT

 

WORLD MARKETS

 

U.S. indices fell 0.6%-1.1% as Salesforce plunged 20% for its worst day in around two decades.

 

U.S. economy grew at an 1.3% annualized rate from January through March, down from the advance estimate of 1.6% after downward revisions to consumer spending. U.S. jobless claims, meanwhile, rose in the latest week.

 

Salesforce plunged 20% after missing revenue expectations for the fiscal first quarter and providing a weak outlook, marking its worst session since 2004.

 

U.S. 10-year treasury yield fell 6 bps to 4.55%. Dollar index fell 0.4% to 104.74. Gold rose quarter of a percent to $2344 per ounce.

 

WTI crude futures fell 1.7% $77.91 while Brent futures fell 2.1% to $81.86 a barrel.

 

In Europe, FTSE and CAC gained 0.6% each while DAX inched up 0.1%. Seasonally-adjusted unemployment rate in the euro area was 6.4% in April, down from 6.5% in March and a fresh record low.

 

AT HOME

 

Sensex and Nifty fell 0.8% and 1% respectively, extending the losing streak to fifth straight day and closing at 2-week low. Sensex settled at 73885, down 617 points while Nifty lost 216 points to finish at 22488. Nifty mid-cap and small-cap indices nosedived 1.3% and 1.6% respectively, both suffering their worst cut in 3-weeks. Nifty Metal and IT indices tumbled 3% and 2.2% respectively, becoming top losers among the sectoral indices while Media and Bank indices were the top gainers, up 0.5% and 0.4% respectively.

 

FIIs net sold stocks, index futures and stock futures worth Rs 3050 cr, 7925 cr and 8443 cr respectively. DIIs were net buyers to the tune of Rs 3433 cr.

 

Rupee appreciated 3 paise to end at 83.32/$.

 

OUTLOOK

 

Today morning, Hang Seng is up 1.7% while Shanghai and Nikkei are up nearly half a percent each, GIFT Nifty is suggesting around 60 points higher start for our market.

 

In yesterday's report we had said that 34-DMA, placed around 22450, was the next downside level to eye while 22900 was the immediate hurdle on the hourly chart, with the stop-loss of which, trading shorts can be held on to.

 

Nifty plunged all the way to 22417 before closing at 22488.

 

22417, the low made yesterday, which roughly coincided with 34-DMA, is the important immediate support to eye, upon breach of which, 22313 and 22100, the 61.8% and 78.6% retracement levels of the recent 21821-23110 upmove, would be next downside levels to eye; 22850 is the immediate hurdle on the hourly chart.

 

For Banknifty, 48300, followed by 48000, continues to be downside levels to eye; 49000-49100 is the immediate resistance zone, upon crossover of which, 49400, the 78.6% retracement level of the recent fall, would be next upside target.

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