8320-8380 MAJOR RESISTANCE AREA; 8200 IMMEDIATE SUPPORT

8320-8380 MAJOR RESISTANCE AREA; 8200 IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow and S & P 500 ended marginally lower while Nasdaq lost half a percent yesterday, digesting a slew of corporate earnings reports and U.S. housing starts data.

IBM tumbled nearly 6% after revenues came in far below consensus.

September housing starts came in well above expectations at 1.206 million.

Nymex oil fell 0.7% to $45.55 a barrel while Brent rose 15 cents.

European markets ended with cuts of upto 1%.

AT HOME

After trading with a positive bias in the first half, benchmark indices slipped in the late noon trade to end modestly lower, breaking three-day winning streak. Sensex settled at 27307, down 58 points while Nifty lost 13 points to finish at 8262. BSE mid-cap and small-cap indices however gained 0.5% and 0.2% respectively. BSE Metal and Oil & Gas indices lost 1.8% and 0.7% respectively, becoming top losers among the sectoral indices whereas Power and IT indices were the top gainers, putting on 1.4% and 1% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 524 cr, 31 cr and 475 cr respectively. DIIs were net sellers to the tune of Rs 355 cr.

Rupee depreciated 26 paise to end at 65.06/$.

Hero Motocorp reported better-than-estimated 1.1% rise in September quarter net profit at Rs 772 cr on better operational performance. Revenue declined 1.1% to Rs 6837 cr. Operating margin expanded by 230 bps to 15.8%.

ACC reported 40% dip in net profit at Rs 115 cr, hit by sales decline as well as subdued prices. Income fell 1% to Rs 2789 cr.  Operating margin fell to 11.2% from 13.5%.

OUTLOOK

Today morning Asian markets are trading with modest gains and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had mentioned that 8320-8380 is the next major target as well as the resistance area where 8320 is the 34-week moving average and 8380 is the 200 DMA.

Nifty, after touching a high of 8294, slipped to end at 8262.

Considering the fact that Nifty has risen nearly 10% from the bottom of 7540 made in early September and is close to major resistances as mentioned above, it would not be a bad idea to book some profit in long positions and hold on to remaining ones with the stop loss of 8200, which is the immediate support on the hourly chart.

HDFC Bank, Bajaj Auto, Wipro, Cairn and Idea will report their quarterly earnings today.

NIFTY ENDS AT TWO MONTH HIGH; TRAIL STOP LOSS TO 8170

NIFTY ENDS AT TWO MONTH HIGH; TRAIL STOP LOSS TO 8170

WORLD MARKETS                             

Dow and S & P 500 ended marginally higher while Nasdaq gained 0.4% yesterday as a rebound in biotech counters offset weak quarterly earnings and a tumble in energy prices sparked by China's economic data. 

China's third-quarter GDP grew at 6.9%, slightly above the expected 6.8%, but also its lowest in six years. Industrial production rose 5.%, below the expected 6% increase.

Banking giant Morgan Stanley posted earnings per share 20 cents below estimates before the bell, with revenue also disappointing. NAHB/Wells Fargo Housing Market index came in at its highest in a decade.

Nymex oil fell nearly 3% to $45.89 a barrel. Brent slipped 3.7% to $48.80. Dollar index rose 0.4% with the euro hitting a 10-day low against the dollar. Gold fell $10 to $1172 per ounce.

European markets ended mixed. FTSE and Spain fell while DAX, CAC and Italy gained.

AT HOME

Benchmark indices ended higher by about half a percent, extending the winning streak to third straight day and closing at the fresh high since 21st August. Sensex settled at 27365, up 150 points while Nifty put on 37 points to finish at 8275. BSE mid-cap and small-cap indices gained 0.7% and 0.8% respectively. BSE Realty and Healthcare indices climbed 2.6% and 1.3% respectively, becoming top gainers among the sectoral indices while Capital Goods and Metal indices lost 0.9% and 0.6% respectively.

FIIs net bought stocks and stock futures worth Rs 898 cr and 238 cr respectively but net sold index futures worth Rs 403 cr. DIIs were net sellers to the tune of Rs 246 cr.

Rupee appreciated 1 paise to end at 64.80/$.

HCL Tech missed street estimates for the September quarter earnings. Dollar revenue rose half a percent sequentially to USD 1545 mn. In rupee terms, revenue rose 3.3% to Rs 10097 cr while Net profit dipped 3.2% to Rs 1726 cr.  Margins eased to 19.4% from 20.2%.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting a flattish start for our market.

After achieving the first upside target of 8225, Nifty has been gradually moving towards the next major target area of 8320-8380 where 8320 is the 34-week moving average and 8380 is the 200-DMA.

Immediate support on the hourly chart has moved up to 8170, with the stop loss of trading longs should be held on to.

Hero Motocorp and ACC will report its quarterly earnings today.

8340-8380 IS THE NEXT TARGET AREA; 8150 IMMEDIATE SUPPORT

8340-8380 IS THE NEXT TARGET AREA; 8150 IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices gained about four tenth of a percent on Friday on the back of surging General Electric shares and upbeat consumer sentiment data.

The preliminary read on October consumer sentiment came in at 92.1. Industrial production declined 0.2% in September, with capacity utilization at 77.5%.

GE rose 3.4% after posting above expected earnings per share.

Nymex oil rose 88 cents or 1.9% to $47.26 a barrel after data showed U.S. rigs falling for the seventh straight week. For the week however, oil fell 4.8%, its worst since Aug. 21.

European markets gained 0.4%-1.3%. European car sales rose 9.8% year-on-year in September helped by demand for German vehicles.

Earlier Nikkei rose 1.1% and Shanghai gained 1.6%.

For the week US indices gained 0.8%-1.2%.  European markets ended mixed. FTSE and Spain lost 0.6% and 0.8% respectively while DAX, CAC and Italy saw modest gains.

AT HOME

After trading in a narrow range for better part of the day, benchmark indices spiked up in the late noon trade to end higher by about three fourth of a percent to close at the highest level since 21st August. Sensex settled at 27215, up 204 points while Nifty rose 59 points to finish at 8238. BSE Capital Goods index and Bankex gained the most among the sectoral indices, rising 1.8% and 1.3% respectively whereas Realty index tumbled 1.4%, becoming top loser, followed by 0.4% cut in Metal and Consumer Durable indices.

FIIs net bought stocks worth Rs 437 cr but net sold index futures and stock futures worth Rs 831 cr and 458 cr respectively. DIIs were net buyers to the tune of Rs 102 cr.

Rupee appreciated 1 paise to end at 64.805/$.

For the week, Sensex and Nifty gained 0.5% and 0.6% respectively, extending the winning streak to third straight week.

Reliance Industries reported better-than-estimated 3.8% q-o-q rise in September quarter net profit at Rs 6561 cr driven by strong operational performance in refining business. Gross refining margin (GRM) was the highest in last seven years, coming in at USD 10.6 a barrel against USD 10.4 in the preceding quarter and ahead of estimates of USD 9-9.5 a barrel.

OUTLOOK

China’s third quarter GDP growth has come in at 6.9% versus 7% in Q2 and expected figure of 6.8%. September Industrial Output is up 5.7% versus expectation of 6%.

Asian markets are trading mixed and SGX Nifty is suggesting about 15 points lower opening for our market.

Readers would recall that ever since Nifty regained higher-top higher-bottom formation by crossing 8055 on 5th October, we have been working with intermediate target of 8225 followed by ultimate target of around 8380.

The benchmark, after achieving the first target on 9th October, consolidated for a few days and ended last week at 8238.

8340-8380, where the 34-week moving average and 200-DMA are placed, continues to be next target area. Immediate support on the hourly chart has moved up to 8150, with the stop loss of which trading longs can be held on to.

HCL Tech and Ultratech Cement will report their quarterly earnings today.

AFTER HOLDING ON TO 8100 SUPPORT, NIFTY SET TO CHALLENGE 8225 HURDLE

AFTER HOLDING ON TO 8100 SUPPORT, NIFTY SET TO CHALLENGE 8225 HURDLE

WORLD MARKETS                             

US indices soared 1.3%-1.8% yesterday as financial stocks rallied and mostly soft economic data supported the case for a rate hike delay.

Goldman Sachs and Boeing contributed the most to gains.

U.S. CPI declined 0.2% in September, matching expectations. Ex-food and energy, the price index rose 0.2% for the month, following a 0.1% rise in August. Weekly jobless claims declined to 255,000, falling back to a 42-year low. October Empire State index came in at negative 11.36 as against negative 14.67 in September. The Philly Fed index stood at negative 4.5 for October.

Nymex oil fell 26 cents or 0.6% to $46.38 a barrel. Gold rose $8 to $1188 an ounce.

European markets gained 0.6%-1.7%

Earlier Nikkei and Shanghai gained 1.2% and 2.3%.

AT HOME

Benchmark indices climbed nine tenth of a percent in today's trade, breaking the three-day losing streak. Sensex settled at 27010, up 230 points while Nifty rose 72 points to finish at 8180. BSE mid-cap and small-cap indices gained 0.8% and 0.5% respectively. Except a 0.1% cut in BSE IT index, all the BSE sectoral indices ended in green with Auto and Oil & Gas indices leading the tally, putting on 2.3% and 1.5% respectively.

FIIs net bought stocks worth Rs 292 cr but net sold index futures and stock futures worth Rs 105 cr and 196 cr respectively. DIIs were net buyers to the tune of Rs 102 cr.

Rupee appreciated 22 paise to end at 64.82/$.

Tata Motors soared 8% after decent growth in Jaguar Land Rover (JLR) September sales.

India's exports fell for the tenth consecutive month in September by falling 24.33% to $21.84 bn. Imports fell 25.4% to $32.32 bn. Trade deficit narrowed to $10.48 bn from $12.5 bn in August as gold and oil imports declined.

Oil marketing companies hiked diesel price by 95 paise per liter while keeping petrol price unchanged.

OUTLOOK

Today morning Asian markets are trading with gains of 1%-1.5% and SGX Nifty is suggesting about 30 points higher opening for our market.

For past couple of sessions, we have been telling about 8100-8225 range. Nifty has been taking support in the vicinity of 8100 while region in the vicinity of 8225 is acting as the supply zone.

After a positive start today, Nifty will be closer to the higher level of this range. A decisive crossover of 8225 will open up the space for the further upside till about 8340-8380 where 34 week average and 200 DMA are placed.

8100 continues to be immediate support, with the stop loss of which trading longs can be held on to.

Reliance Industries will report its quarterly earnings today. Net profit is expected to fall to Rs 6000 cr from Rs 6318 in the April-June quarter mainly on the back of fall in Gross refining margin, which is expected to ease to $9-9.5 from $10.4. 

NIFTY EXTENDS CONSOLIDATION; 8100 CONTINUES TO BE IMMEDIATE SUPPORT

NIFTY EXTENDS CONSOLIDATION; 8100 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices fell 0.3%-0.9%, digesting mixed results from the banking sector as well as the release of lower-than-expected sales forecasts

U.S. retail sales barely rose in September while producer prices posted their biggest decline in 8 months.

Wal-Mart plunged 10% after the company said it expects sales to be flat in fiscal year 2016. Boeing tumbled 4.3% amid concerns about aircraft demand following Delta comments in its earnings call yesterday about a "huge bubble in excess wide-body airplanes,". Intel gained 2.4% following earnings that beat on both the top and bottom line.

Following JPMorgan's disappointing results late Tuesday, Bank of America reported earnings that beat analysts' expectations.

US 10-year treasury yield fell to 1.98%, falling below 2% for the first time since Oct. 5. Dollar index fell nearly a percent with the euro above $1.14 and the yen at 118.77 against the dollar. Gold climbed $14 to $1180 an ounce. Nymex oil settled down 2 cents at $46.64 a barrel.

Earlier data showed that China's consumer price index (CPI) rose 1.6% in September from a year earlier, against forecasts of a 1.8% rise and following August's 2% gain.

European markets gave away 0.7%-1.2%

AT HOME

Benchmark indices ended lower by a fourth of a percent after a rangebound trade, extending the losing streak to third straight day. Sensex settled at 26780, down 67 points while Nifty lost 24 points to finish at 8108. BSE mid-cap index lost 0.3% while the small-cap index gained 0.4%. BSE IT and Teck indices lost 1.3% and 1.2% respectively, becoming top losers among the sectoral indices whereas Consumer Durable and Healthcare indices gained 1.4% and 0.4% respectively.

FIIs net bought stocks worth Rs 122 cr but net sold index futures and stock futures worth Rs 873 cr and 688 cr respectively. DIIs were net sellers to the tune of Rs 208 cr.

Rupee appreciated 15 paise to end at 65.04/$.

India's wholesale price inflation for September came in at -4.54%, improving somewhat from -4.95% in August.

HUL reported 2.6% y-o-y dip in September quarter net profit at Rs 962 cr. Revenue rose 4.1% to Rs 7955 cr. Domestic consumer business grew at 5%, with 7% underlying volume growth.

Zee Entertainment Ltd posted 7.3% y-o-y growth in September quarter net profit at Rs 246.3 cr. Consolidated revenue rose 24% to Rs 1385 cr. Advertising revenue grew at a solid 35% at Rs 843 cr. Subscription revenue rose 13% to Rs 479 cr.

OUTLOOK

Today morning, Asian markets, except a marginally lower Shanghai, are trading with gains of 0.5%-1.5% and SGX Nifty is suggesting about 30 points higher opening for our market.

As we have been mentioning for couple of days, 8100 continues to be immediate support, a sustained trading below which will generate a sell on the hourly chart. On the way up, 8225 continues to be immediate hurdle, a sustained trading above which is required for a fresh upmove.

8100-8225 CONTINUES TO BE IMMEDIATE RANGE

8100-8225 CONTINUES TO BE IMMEDIATE RANGE

WORLD MARKETS                             

US indices lost 0.3%-0.9% yesterday, with the Dow breaking seven-day winning streak, weighing slight declines in oil prices and more indications of slowdown in China's economy.

China's dollar-denominated imports plunged by a worse-than-expected 20.4% in September from a year earlier, while exports slipped 3.7%, producing a trade surplus of $60.34 billion.

Johnson & Johnson reported earnings that beat but missed on revenue.

Nymex oil fell 44 cents or 0.9% to $46.66 a barrel. Brent declined to below $49 a barrel. The International Energy Agency reported that global oil demand growth would slow in 2016 to 1.2 mn barrels per day from 1.8 million in 2015.

European markets fell 0.2%-1% with DAX leading the tally. Basic resources sector was the worst hit with Glencore falling 2.5%. The world's two biggest beer brewers - Anheuser-Busch InBev and SABMiller - announced that Belgium's AB InBev will buy the U.K.-listed SABMiller for £44 per share ($67.6) in cash.

AT HOME

After falling nearly two third of a percent, benchmark indices rebounded in last hour or so to end just modestly lower. Sensex settled at 26847, down 58 points while Nifty lost 12 points to end at 8132. BSE mid-cap index ended flat while the small-cap index gained 0.4%. BSE IT and Teck indices were the top losers among the sectoral indices, falling 1% and 0.9% respectively while Realty index soared 1.3%, becoming top gainer, followed by 0.3% rise in Power index.

FIIs net bought stocks worth Rs 273 cr but net sold index futures and stock futures worth Rs 387 cr and 331 cr respectively. DIIs were net sellers to the tune of Rs 274 cr.

Rupee tumbled 44 paise to end at 65.18/$.

TCS reported in-line with estimated profit and volume growth figures for the quarter ended September but revenue missed forecast for the fifth consecutive quarter. Dollar revenue rose 3% to USD 4156 mn and 3.9% in constant currency. Rupee revenue grew by 5.8% to Rs 27165 cr and net profit rose 6.1% to Rs 6055 cr. Volume growth was 4.9%. EBIDTA margin expanded by 80 bps to 27.1%.

OUTLOOK

China's September CPI has come in at 1.6% vs estimate of 1.8% and August's 2% reading. PPI fell 5.9%, unchanged from previous month and in-line with estimate.

Asian markets are trading with cuts of 0.5%-1.5% with Nikkei leading the losses and SGX Nifty is suggesting about 25 points lower opening for our market.

In yesterday's report we had mentioned that "8100 continues to be immediate support, a sustained trading below which will generate a sell on the hourly chart".

The benchmark, after touching a low of 8089, recovered to end at 8132.

After today's lower opening, Nifty would again be close to 8100 support, upon sustained trading below which trading longs should be cut. 7900, where 34-DMA is placed, would be the next meaningful target if 8100 is violated decisively.

On the other hand a sustained trading above 8225 is required for the fresh upmove.

WPI for September would be released today and is expected to show a reading of -4.4% versus -4.95% in August.

HUL and ZEEL will report their quarterly earnings today.

NIFTY STRUGGLES TO CROSS 8225 HURDLE; 8100 CONTINUES TO BE IMMEDIATE SUPPORT

NIFTY STRUGGLES TO CROSS 8225 HURDLE; 8100 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices ended with gains of upto 0.3% yesterday as gains in utility counters offset a retreat in energy plays.

Nymex oil fell $2.53 or 5% to $47.10 a barrel, giving back more than half of last week's rally of nearly 9%. Gold rose $9 to $1164 an ounce.

Dell announced a $67 billion cash and stock deal with MSD Partners and Silver Lake to buy cloud computing firm EMC.

European markets, except a 0.2% higher DAX, fell 0.3%-0.8%. Glencore sank over 6% after the London-listed mining giant said it planned to sell copper mines as part of efforts to slash its debt pile.

Earlier, the Shanghai Composite surged more than 3% and the Hang Seng closed up 1.2% amid expectations that Beijing would roll out further stimulus measures to ward off a sharper slowdown.

AT HOME

After gaining more than half a percent in the opening trade, benchmark indices tumbled more than a percent from the top of the day to end lower by about six tenth of a percent. Sensex settled at 26904, down 175 points while Nifty lost 46 points to finish at 8144. BSE mid-cap index however gained 0.2% and the small-cap index ended flat. BSE IT and Teck indices plunged 2% and 1.8% respectively, becoming top losers among the sectoral indices while Metal and Power indices gained 1.2% and 0.9% respectively.

Infosys stock tumbled 3.8% despite reporting better-than-estimated quarterly numbers as the company did not raise full year revenue growth guidance and CFO Rajiv Bansal announced a surprise resignation. A dip in volume growth, a slight uptick in attrition rate and an ESOP that could lead to a 2% equity dilution going forward also weighed on the sentiment. Dollar revenue for the quarter surged 6%-the steepest in the last 16 quarter-to USD 2.392 bn. Net profit rose 12.1% to Rs 3398 cr and rupee revenues grew 8.9% to Rs 15635 cr. Operating margin improved by 153 bps to 25.53%. The company maintained its constant currency revenue growth of 10-12% for the full year but tweaked its dollar revenue guidance to 6.9-8.4% from 7.2%-9.2%.

Bank OF Baroda fell 3.4% after the Central Bureau of Investigation (CBI) raided 50 locations in connection with alleged irregularities at one of its Delhi branch. Reports said the raids were in connection with suspected money laundering involving around Rs 6,000 crore.

FIIs net bought stocks and index futures worth Rs 318 cr and 743 cr respectively but net sold stock futures worth Rs 65 cr. DIIs were net sellers to the tune of Rs 175 cr.

Rupee depreciated 1 paise to end at 64.75/$.

The Consumer Price Inflation for the month of September came in at 4.41%, up from 3.66% in August but lower than the estimated figure of 4.49%.

Index of industrial production (IIP) for August came in near 3-year high at 6.4% versus 4.2% seen in July.

OUTLOOK

Today morning Asian markets are trading flat to modestly lower and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had mentioned that having achieved the 8225 target, next target for Nifty is 8350-8380 and had advised holding on to trading longs with the stop loss of 8100.

The benchmark, after touching a high of 8244 in the opening trade, slipped to end at 8144.

8100 continues to be immediate support, a sustained trading below which will generate a sell on the hourly chart. On the way up a sustained trading above 8225 can take the benchmark to 8350-8380 region.

Traders are advised to hold existing longs with the stop loss of 8100.

TCS will report its quarterly earnings today.