NIFTY REBOUNDS AFTER HOLDING 7380 SUPPORT

NIFTY REBOUNDS AFTER HOLDING 7380 SUPPORT

WORLD MARKETS                             

US indices gained 0.2%-0.6%, helped by a rise in oil prices.

Energy sector led the gainers as Nymex oil jumped $1.8 or 5% to $38.29 a barrel, its highest settle since Dec. 4. Weekly crude inventories showed a rise of 3.9 mn barrels but a drop of 4.5 mn barrels in gasoline inventories. Statement by an Iraqi oil official that OPEC and non-OPEC members would meet in Moscow on March 20 to discuss an output freeze, also boosted the sentiment. Brent climbed 4% to $41.07 a barrel.

In economic news, US weekly mortgage application volume increased 0.2%. Wholesale inventories rose 0.3% in January, while sales declined 1.3%.

European markets ended higher by 0.2%-1.1%

AT HOME

After falling about three fourth of a percent in the initial trade, benchmark indices climbed nearly a percent and half from the bottom of the day to end higher by six tenth of a percent, with Nifty closing at the highest level since 1st February 2016. Sensex settled at 24794, up 135 points while Nifty added 46 points to finish at 7532. BSE mid-cap and small-cap indices gained 0.9% and 0.04% respectively. BSE Capital Goods and Realty indices climbed 1.6% and 1.5% respectively, becoming top gainers among the sectoral indices while Metal and Consumer Durable indices lost 0.8% each.

FIIs net bought stocks and index futures worth Rs 463 cr and 155 cr respectively but net sold stock futures worth Rs 1253 cr. DIIs were net sellers to the tune of Rs 824 cr.

Rupee appreciated 14 paise to end at 67.21/$.

OUTLOOK

China's February CPI has come in at 1.6% MoM Vs expectation of 1.9%.

Barring a 0.7% cut in Shanghai, other Asian markets are trading with gains of upto a percent with Nikkei leading the gains and SGX Nifty is suggesting about 20 points higher opening for our market.

In yesterday's report we had reiterated our view that 7540, the erstwhile support, would now act as the hurdle, a crossover of which is required for fresh upmove. We had also said that 7380, the lower level of the gap created by the gap up opening on Thursday, is the immediate support.

The benchmark, after touching a low of 7424 in the initial trade, rebounded smartly to end at 7532.

A higher opening today would take Nifty above 7540 hurdle. Upon sustained trading above 7540, 7600, which is the immediate previous top on the weekly chart would be the next target to eye. Upon a decisive crossover of 7600, next major target to eye would be 7840, where the 34-week moving average is placed.

Immediate support on the hourly chart has moved up to 7450, which should serve as the stop loss for trading longs.

Key event to watch out today would be ECB policy meeting. ECB President Mario Draghi, is expected to announce more stimulative measures, with hopes of expansion of the asset purchase program and a possible further cut to the already negative deposit rate.

NIFTY RETREATS AFTER HITTING 7510-7540 TARGET AREA

NIFTY RETREATS AFTER HITTING 7510-7540 TARGET AREA

WORLD MARKETS                             

US indices fell 0.6%-1.3% yesterday as oil prices reversed and weaker-than-expected Chinese trade data renewed concerns about global growth.

Energy sector led the losers as Nymex oil fell $1.40 or 3.7% to $36.50 a barrel. Brent settled down 3% at $39.65 a barrel.

China's trade data showed that exports fell 25.4% in February in U.S. dollar terms, while imports fell 13.8%, with both declines wider than expectations. The drop in exports was the largest on-year drop since 2009. Several industrial metals including copper, nickel and aluminum saw a sharp drop following the data.

European markets lost 0.2%-1% with basic resources stocks taking the biggest hit.

AT HOME

After gaining about half a percent in the initial trade, benchmark indices gave away all the gains though rest of the session to end flat, extending the consolidation to second day. Sensex settled at 24659, up 13 points while Nifty remained unchanged at 7485. BSE mid-cap index lost 0.2% while the small-cap index gained 0.2%. BSE Metal and Oil & Gas indices gained 1.7% and 1.5% respectively, becoming top gainers among the sectoral indices while Bankex tumbled 1.3%, becoming top loser, followed by 0.6% cut in finance index.

FIIs net bought stocks, index futures and stock futures worth Rs 775 cr, 803 cr and 349 cr respectively. DIIs were net sellers to the tune of Rs 1342 cr.

Rupee depreciated 28 paise to end at 67.36/$.

OUTLOOK

Today morning Asian markets are trading with cuts of upto 2% with Shanghai leading the losses and SGX Nifty is suggesting about 20 points lower opening for our market.

Readers would recall that we had been working with target area of 7512-7540 ever since 7250 hurdle was taken out. We had also advised booking profit in trading longs in this region considering steep run-up over past couple of sessions.

The benchmark touched a high of 7527 yesterday, hitting this target area, and retreated from there to close at 7485.

7540, as we have been mentioning, is the erstwhile double bottom made in September and December 2015 respectively which would now act as a hurdle. A decisive breach of this hurdle is required for the fresh upmove.

7380, the lower level of the gap created by the gap up opening on Thursday, is the immediate support on the way down, a breach of which can take the benchmark to around 7280, where the 34-DMA is placed.

NIFTY NEARLY HITS 7510-7540 TARGET AREA; 7380 CONTINUES TO BE IMMEDIATE SUPPORT

NIFTY NEARLY HITS 7510-7540 TARGET AREA; 7380 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow and S & P 500 gained 0.4% and 0.1% respectively while Nasdaq lost 0.2% yesterday, as gains in energy stocks offset declines in technology. For the Dow and S & P 500, it was the fifth straight day of gains.

Nymex oil climbed $2 to settle at $37.90 a barrel. Brent rose $2.12 to $40.84.

In a big move iron ore prices jumped 19% from $52.40 to $62.60 a tonne.

European markets ended mixed.

China's foreign currency reserves fell to $3.2 trillion at the end of February, dropping from $3.23 trillion the previous month, marking the fourth straight month of declines, although the pace of outflows slowed substantially.

AT HOME

It was a day of consolidation after three days of marathon rally, as benchmark indices ended marginally higher after a rangebound but choppy session. Sensex settled at 24646, up 39 points while Nifty added 10 points to finish at 7485. BSE mid-cap and small-cap indices gained 1.1% and 0.8% respectively. BSE Metal index and Bankex climbed 2.2% and 1.3% respectively, becoming top gainers among the sectoral indices while Telecom and IT indices lost 0.7% and 0.5% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 672 cr, 147 cr and 300 cr respectively. DIIs were net sellers to the tune of Rs 533 cr.

Rupee appreciated 26 paise to end at 67.08/$. For the week, rupee gained 2.3%, its biggest weekly gain since September 2013.

For the week, Sensex and Nifty soared 6.5% and 6.4% respectively, marking the largest weekly gain since the week ended 2nd December 2011.

OUTLOOK

Today morning, Asian markets are trading with cuts of 1%-2.5% with Shanghai leading the losses. SGX Nifty is trading around 7495, which is about 20 points higher than Friday's close of Nifty future.

Nifty on Friday touched a high of 7506 before closing at 7485, nearly achieving the 7510-7540 target area we have been working with ever since 7250 hurdle was taken out.

As advised, traders would do well to book some profit in this region.

7380 continues to be immediate support, with the stop loss of which remaining positions can be held on to.

BOOK SOME PROFIT AS 7512-7540 RESISTANCE AREA APPROACHES

BOOK SOME PROFIT AS 7512-7540 RESISTANCE AREA APPROACHES

WORLD MARKETS                             

After falling about half a percent in the first hour or so, US indices saw a sustained northward move through rest of the session to end with gains of 0.1%-0.3% ahead of Friday's non-farm payroll data.

The ISM non-manufacturing survey for February came in at 53.4, above expectations but a touch below January's 53.5 read. Final February Markit services PMI was 49.7, down from January's final 53.2 print and the lowest since October 2013. January factory orders rose 1.6%. Durable goods orders were revised slightly lower to show a rise of 4.7%, versus the prior 4.9% increase. Weekly jobless claims came in at 278,000. Revised fourth-quarter productivity declined 2.2%, while unit labor costs rose 3.3%.

Nymex oil fell 0.26% to $34.57 a barrel while Brent lost 0.4% to settle at $37.07 a barrel.

Dollar index fell about half a percent. Gold April future climbed 1.3% to $1258 an ounce.

Key European markets ended modestly lower. Healthcare sector ended 2.4% lower after credit rating agency, Moody's cut its outlook on the global pharmaceuticals industry from "positive" to "stable". Basic resources stocks however continued to advance helped by a solid rise in the price of metals.

AT HOME

Fanatic Bull Run extended to third straight day as benchmark indices soared a percent and half to close at the highest level in nearly a month. Sensex settled at 24607, up 364 points while Nifty climbed 107 points to finish at 7476. BSE mid-cap and small-cap indices gained 0.6% and 1.4% respectively. Except a 0.2% cut in BSE FMCG index, all the sectoral indices ended in green with Capital Goods and Metal indices leading the tally, up 4.1% each.

FIIs net bought stock, index futures and stock futures worth Rs 912 cr, 260 cr and 256 cr respectively. DIIs were net sellers to the tune of Rs 465 cr.

Rupee appreciated 20 paise to end at 6-week high of 67.34/$.

India's Services PMI for February came in at a 3-month low of 51.4, down from 54.3 in January.

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 30 points higher opening for our market.

At the risk of repeating, we had advised going long on Nifty ever since 7094, the high made on budget day, was crossed. After the initial target of 7252 was achieved, we have been working with next major target area of 7512-7540.

The benchmark yesterday touched a high of 7484 before closing at 7476, coming in very close to target area mentioned above.

Looking at the steep run-up over past three sessions, traders would do well to book some profits in long positions as 7512-7540 resistance area approaches.

7380, the gap created by yesterday's gap up opening, would now act as the immediate support, which should serve as the stop loss in remaining positions.

Key data to watch out today would be US nonfarm payroll data for February which is expected to show an addition of 190,000 jobs while unemployment rate is expected to remain unchanged at 4.9%.

NIFTY ON TRACK TO ACHIEVE 7510-7540 TARGET; TRAIL STOP LOSS TO 7235

NIFTY ON TRACK TO ACHIEVE 7510-7540 TARGET; TRAIL STOP LOSS TO 7235

WORLD MARKETS                             

After falling more than half a percent in the initial trade, US indices saw a sustained upmove through rest of the session to end with gains of 0.2%-0.4%

Energy sector led the gains as Nymex oil, after hitting $35.17, its highest level since Jan 6, settled at $34.66, up 26 cents or 0.8%. The US oil inventory report showed a build in stockpiles but a continued decline in production, down 25000 to 9.077 million barrels a day. Media reports citing Venezuela's Oil Minister said more than 15 countries will attend an upcoming oil meeting to discuss an output freeze plan and possible further actions. Brent rose 12 cents to $36.93.

Fed's Beige Book said that economic activity increased in most regions. Consumer spending rose in most districts. The ADP employment report showed U.S. private employers added a more-than-expected 214,000 jobs in February. Treasury yields edged higher after the report.

European markets, except a 0.1% lower FTSE, gained 0.4%-1.8% as mining and bank shares rose.

Earlier Nikkei and Shanghai surged more than 4%, shaking off news Moody's lowered its China government bond rating outlook to "negative" from "stable".

Gold rose $11 to $1242 an ounce.

AT HOME

Bull march continued as benchmark indices, after soaring three and a half percent on Tuesday, added another 2% yesterday to close at the highest level since 8th February. Sensex settled at 24243, up 464 points while Nifty surged 147 points to finish at 7369.  BSE mid-cap and small-cap indices gained 1.9% and 2.2% respectively. Except a 0.1% cut in BSE FMCG index, all the sectoral indices ended in green with Realty index and Bankex leading the tally, up 5% and 4.9% respectively.

Banking stocks soared after RBI's decision to relax capital rules for banks to help meet Basel-III norms that will provide additional capital to banking sector.

FIIs net bought stocks, index futures and stock futures worth Rs 1437 cr, 1189 cr and 966 cr respectively. DIIs were net sellers to the tune of Rs 593 cr.

Rupee rose 31 paise to end at 67.54/$.

OUTLOOK

China's February Caixin Services PMI has come in at 51.2, down from 52.4 registered in previous month.

Asian markets are trading with gains of upto a percent and SGX Nifty is suggesting about 50 points higher opening for our market.

Readers would recall that in Tuesday's report we had advised going long above 7090 for target of 7252 which was the top made on 22nd February. In yesterday's report we had mentioned that once Nifty takes out 7252-7280 resistance area, where 7280 was the 34-DMA, the next meaningful target would be 7510-7540 region where 7512 is the top made on 8th February and 7540 is where Nifty had made double bottom in September and December 2015.

The benchmark soared 147 yesterday to end at 7369 and is set to open with a gap up even today and is on course to achieve 7512-7540 target.

7235, the lower end of the gap created by yesterday's gap up opening, would now serve as the immediate support on the way down, with the stop loss of which trading longs should be held on to.

WORLD EQUITIES START MARCH WITH A BANG; NIFTY SET TO ACHIEVE 7250 TARGET AND MORE

WORLD EQUITIES START MARCH WITH A BANG; NIFTY SET TO ACHIEVE 7250 TARGET AND MORE

WORLD MARKETS                             

US indices, supported by a rise in oil prices and a better-than-expected ISM manufacturing report, soared 2.1%-2.9% yesterday, marking the best start to a month in more than three years.

Nymex oil reversed an intraday dip to end higher by 65 cents or 2% at $34.40 a barrel.

February ISM manufacturing came in at 49.5, about 1 point above expectations and topping January's 48.2 print. Construction spending rose 1.5% in January to its highest level since 2007. The Markit manufacturing PMI for February came in at 51.3, up from the flash 51.0 print but down from January's final 52.4 read.

European markets gained 1%-2.3%. ECB President Mario Draghi said that euro area inflation trends are weaker than expected and the ECB's policy review in March has to "be seen against the background of increased downside risks to the earlier outlook."

AT HOME

It was a spectacular beginning to March month as benchmark indices soared nearly three and half percent with Nifty registering the biggest percentage gain since 19th September 2013. Sensex surged 777 points to settle at 23779 while Nifty finished at 7222, up 235 points. BSE mid-cap and small-cap indices gained 3% and 3.2% respectively. All the BSE sectoral indices ended in green with FMCG and Consumer Durable indices leading the tally, up 4.9% and 4.4% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 1761 cr, 706 cr and 495 cr respectively. DIIs were net buyers to the tune of Rs 317 cr.

Rupee appreciated 57 paise to end at 67.86/$.

Maruti reported 0.9% y-o-y dip in February sales at 1.17 lac units. Eicher reported 63% surge in Royal Enfield sales at 49156 units. Ashok Leyland sold 25% higher vehicles at 13403 units. M & M too reported healthy growth of 16% at 44002 units.  Hero Motocorp reported 13.6% growth.

OUTLOOK

Today morning Nikkei is up more than 3%, other Asian markets are up and SGX Nifty is suggesting nearly 100 points higher opening for our market.

In yesterday's report we had mentioned that 7090, the 61.8% retracement level of the recent 7252-6826 fall, which also coincides with the top made on budget day, is the immediate hurdle, upon sustained trading above which 7252 would be the next target to eye.

Nifty crossed this hurdle in first half an hour itself and surged all the way to 7235 before closing at 7222.

A big gap up opening would see the benchmark achieving 7250 target and going much beyond it.

7250 is the immediate previous top on the daily chart made on 22nd February and 34-DMA is placed around 7280 which makes 7250-7280 immediate resistance area. If Nifty is able to sustain above 7280 on closing basis, it would have crossed 34-DMA resistance after nearly 2 months. Upon happening that, next resistance zone or target area would be 7510-7540 where 7512 is the top made on 8th February and 7540 is where Nifty had made double bottom in September and December 2015.

7130 is the immediate support on 15 minute chart with the stop loss of which trading longs should be held on to.

NIFTY CUTS LOSSES ON “FISCALLY PRUDENT” BUDGET; 7090 IS THE IMMEDIATE HURDLE

NIFTY CUTS LOSSES ON “FISCALLY PRUDENT” BUDGET; 7090 IS THE IMMEDIATE HURDLE

WORLD MARKETS                             

US indices reversed gains made in morning session to end lower by about three fourth of a percent

This was despite a rise in Nymex oil which settled up 97 cents or 3% at $33.75 a barrel. Brent rose 87 cents or 2.5% to $35.97.

Chicago PMI came in at 47.6 in February, missing expectations and dropping from 55.6 in January. Pending home sales fell 2.5% in January, versus expectations for a slight gain.

Earlier Shanghai Composite ended lower by 3%. After China's market closed, the People's Bank of China cut the reserve requirement ratio (RRR), the amount of cash the country's bank have to hold, by 0.5%. The cut was the first since October and the fifth since last February.

European markets, except a 0.2% lower DAX and flat FTSE, gained 0.8%-1.3%. Basic resources sector rallied the most following PBOC move. Eurozone inflation fell to negative 0.2% in February, boosting expectations of more policy easing when the ECB meets on March 10.

Gold rose $14 to $1234 an ounce.

For the month, S&P500 and Nasdaq lost 0.4% and 1.2% respectively in their third straight month of decline. Dow managed to gain 0.4%. Nymex oil gained 0.4% for February, its first positive month since October. Gold gained 11%.

AT HOME

After gyrating between a massive 4% intraday range on account of Union Budget, benchmark indices ended lower by about six tenth of a percent. Sensex settled at 23002, down 152 points while Nifty lost 43 points to finish at 6987. BSE mid-cap and small-cap indices ended little changed. BSE IT and Teck indices tumbled 2.1% and 2% respectively, becoming top losers among the sectoral indices while Bankex and Finance indices were the top gainers, up 1.1% and 0.9% respectively.

Presenting his second full-fledged budget, Arun Jaitley adhered to fiscal consolidation roadmap by proposing to keep the deficit at 3.5% of GDP in 2016-17. Total government expenditure in next fiscal would be Rs 19.78 lakh cr out of which plan expenditure would be up 15.3% at Rs 5.5 lakh cr while non-plan expenditure is estimated at Rs 14.28 lakh cr. FY17 food subsidy has been pegged at Rs 1.35 lakh cr while petroleum subsidy is expected at Rs 26900 cr.

FM reduced the Long Term Capital Gain period for unlisted companies to 2 years from 3 years but made no changes for the listed companies which was a positive from stock market perspective.

A 0.5% Krishi Kalyan Cess has been imposed on all taxable services effective June 1, 2016. However this was less than the 2% hike expected in the service tax.

On the flip side, Rs. 25000 cr were provided for the recapitalisation of public sector banks which fell short of market expectation. Corporate tax was cut to 29% for companies with turnover less than Rs 5 cr. which too fell short of expectation. Also dividend income of Rs 10 lakh or more will now attract a 10% tax and the surcharge on people earning more than Rs 1 cr has been upped to 15% from 12%.

FY17 strategic sale has been expected at Rs 20500 cr while the divestment target has been set at Rs 36000 cr.

Other key announcements include reduction in cess on crude from Rs 4500/MT to 20% ad valorem, raising the cess on coal, lignite and peat from current Rs 200 a tonne to Rs 400 per tonne. Also 1% infra cess on small petrol/LPG/CNG cars, 2.5% tax on sub-4 metre diesel cars and 4% tax on higher capacity sedans, MPVs and SUVs has been proposed.

While making no change in personal Income Tax slabs, FM announced deduction for additional interests of Rs 50,000 per annum for loans up to Rs 35 lakh sanctioned in 2016-17 for first time home buyers, where house costs does not exceed Rs 50 lakh.  Jaitley also proposed to increase the limit of deduction of rent paid from Rs 24,000 per annum to Rs 60,000 spelling respite to those who don’t own any house and live in rented accommodation. For those earning less than Rs 5 lakh per annum, FM announced to raise the ceiling of tax rebate from Rs 2000 to Rs 5000 giving an additional relief of Rs 3000 in their tax liability.

FIIs net sold stocks worth Rs 2018 cr but net bought index futures and stock futures worth rs 668 cr and 629 cr respectively. DIIs were net buyers to the tune of Rs 784 cr.

Rupee appreciated 20 paise to end at 68.425/$.

OMC cut petrol price by Rs. 3/litre while hiked diesel price by Rs 1.47/litre.

OUTLOOK

Today morning Asian markets are trading mixed with changes of upto half a percent and SGX Nifty is suggesting about 50 points higher opening for our market.

Yesterday, after making a fresh 52-week low of 6826, Nifty rebounded sharply to 7095 but fell from there to end at 6987.

Yesterday was the last day of February and that's why 6826, the low made yesterday, which is also the monthly low, is a very important support to eye. Also, Nifty has closed below the lower band of monthly bollinger, which last happened in December 2011 when Nifty had made a low of 4531. The nearest support to eye if 6826 is broken would be 6650, where the 61.8% retracement level of the entire 5119-9119 upmove is placed.

On the way up 7090, the 61.8% retracement level of the recent 7252-6826 fall, which also coincided with the top made yesterday, is the immediate hurdle, upon sustained trading above which 7252 would be the next target to eye.

Traders are advised to wait for the sustained crossover of 7090 for taking long position in Nifty.