11620 ABOVE 11400; 11180-11080 IS THE SUPPORT ZONE

11620 ABOVE 11400; 11180-11080 IS THE SUPPORT ZONE

WORLD MARKETS

US indices fell 0.5%-0.8% on Friday on news that Chinese officials were cutting short their visit to the U.S., dampening hope around trade negotiations between the two countries.

Earlier, deputy trade negotiators from the U.S. and China resumed face-to-face talks for the first time in almost two months.

St. Louis Fed President James Bullard explained in a note why he thought the Fed should have made a deeper cut this week.

Earlier, China cut a key lending rate for the second consecutive month , following in the footsteps of the European Central Bank and the U.S. Federal Reserve.

WTI crude fell 4 cents, or 0.1% to $58.09 per barrel while Brent futures fell 12 cents to settle at $64.28.

In Europe, FTSE fell 0.2% while DAX and CAC rose 0.1% and 0.6% respectively.

For the week, US indices fell 0.5%-1.1%, breaking three-week winning streak. In Europe, FTSE fell 0.3%, DAX was flat while CAC rose 0.6%. In Asia, Nikkei rose 1.5% but Hang Seng nosedived 3.4% and Shanghai fell 0.8%. For the week, Brent rose 6.7%, its biggest gain since January while WTI rose 5.9%, notching its biggest weekly gain since a 9% surge in June.

AT HOME

Thanks to big bang announcement from FM, Sensex and Nifty soared 5.3%, registering biggest percentage gain in a decade. Sensex settled at 38014, up 1921 points while Nifty added 569 points to finish at 11274. BSE mid-cap and small-cap indices jumped 6.3% and 3.9% respectively. Except 1.1% and 0.4% lower IT and Teck indices respectively, all the BSE sectoral indices ended in green with Auto index and Bankex leading the tally, up 9.8% and 8.2% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 36 cr, 5079 cr and 1682 cr respectively. DIIs were net buyers to the tune of Rs 3001 cr.

Rupee appreciated 37 paise to end at 70.94/$.

In a surprise and big move, government, on Friday, cut corporate tax rate for companies that do not avail of any tax incentive to 22% from 30%. Companies, incorporated after 1st October, 2019 will have to pay an even lower corporate tax rate of 15%. Minimum Alternate Tax (MAT) was cut to 15% from 18.5% for companies that continues to avail exemptions and incentives. These measures will cost the exchequer Rs 1.45 lakh cr.

FM Sitharaman also announced that the government will not levy enhanced surcharge introduced in Budget on capital gain arising from the sale of equity shares and units of mutual funds where STT has been paid. The super-rich tax will also not apply on capital gains arising from the sale of any security including derivatives in hands of foreign portfolio investors (FPIs). She added that listed companies which had announced share buybacks before 5 July, the day the Union Budget brought share buybacks under the tax net, will be exempt from buyback tax.

GST Council scrapped tax on hotel rooms with tariff below Rs 1000 and cut rate on hotel rooms with tariff over Rs 7500 to 18%. The council rejected the proposal of rate reduction on biscuit while proposal on rte reduction on auto was not considered. Rate on Caffeinated drinks was hiked to 28% from 18%.

OUTLOOK

China’s Ministry of Commerce said over the weekend that economic and trade teams from the two economic powerhouses held “constructive” discussions in Washington late last week. They added that both the U.S. and China agreed to maintain in contact.

Today morning, Nikkei is shut while Hang Seng is flat and Shanghai is off 0.9%. SGX Nifty is trading around 11450, suggesting nearly 150 points higher start for our market when compared to close of Nifty future on Friday.

After the mammoth upmove on Friday, Nifty is very close to important resistance levels. 20 and 34-week moving averages are placed at 11362 and 11401 respectively while 11370 is where 50% retracement level of the entire 12103-10637 fall is placed. This makes 11360-11400 important resistance zone, a crossover of which is required for a fresh upmove. If that happens, 11620, the 67% retracement level of the entire fall, would be the next upside target.

On the way down, 11180-11080, where erstwhile tops made on daily chart are placed, would now act as the support zone.

NIFTY NEARS 10637 TARGET AFTER ACHIEVING 10746

NIFTY NEARS 10637 TARGET AFTER ACHIEVING 10746

WORLD MARKETS

Dow fell 0.2%, S & P 500 finished flat while Nasdaq ended marginally higher after some media reports dented hopes of US-China trade deal.

A state-backed Chinese media report said that known China hawk and Trump advisor Michael Pillsbury warned the U.S. is ready to escalate the trade war if a deal isn’t struck soon. Also, a tabloid editor at the official newspaper of the Communist Party of China tweeted that China was in no rush to make a trade deal with the U.S.

Brent futures gained 72 cents to $64.33 a barrel, while U.S. West Texas Intermediate crude settled up 2 cents at $58.13.

European markets gained 0.6%-1.2%. The Bank of England held interest rates steady at 0.75% amidst continued uncertainty over Brexit.

AT HOME

After yesterday's pause, bulls were back to work as benchmark indices plunged nearly a percent and third to close at the lowest level since 1st March and 19th February respectively, marking a near seven month low. Sensex settled at 36093, down 470 points while Nifty lost 136 points to finish at 10704. BSE mid-cap and small-cap indices fell 1.2% and 1.5% respectively.  Except 0.2% lower Telecom index, all the BSE sectoral indices ended in red with Energy and Oil & Gas indices leading the losses, down 2% and 1.9% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 893 cr, 1700 cr and 408 cr respectively. DIIs were net buyers to the tune of Rs 646 cr.

Rupee depreciated 8 paise to end at 71.31/$.

Yes Bank plunged after CARE downgraded NCDs of the bank's promoter, MCPL. After market hour filing revealed that Morgan Crdit sold 2.3% shareholding in the bank. ZEEL fell after media reports suggested that Zee promoters met MF lenders for an extension of the September 30 deadline for the repayment of debt.

Finance Minister Nirmala Sitharaman, in a bid to push credit, said banks will orgainse loan gatherings across 200 districts. Also, MSME stressed loans will not be declared NPAs till March 2020.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.2%-0.5% and SGX Nifty is suggesting a marginally higher start for our market.

In yesterday's report we had reiterated the view that "10746, the low made on 4th September, continues to be next downside support, upon breach of which, 10637, the low made in August, would be the crucial support".

Nifty, after achieving 10746 target, went further to touch a low of 10670 before closing at 10704, vindicating our negative bias.

10637, the bottom made in August, continues to be crucial support to eye. If that breaks, next meaningful support will come around 10450, where 34-month moving average is placed.

Immediate hurdle on the hourly chart has moved lower to 10900, with the stop-loss of which, trading shorts can be held on to.

10746 CONTINUES TO BE NEXT SUPPORT; 10990 IMMEDIATE HURDLE

10746 CONTINUES TO BE NEXT SUPPORT; 10990 IMMEDIATE HURDLE

WORLD MARKETS

Dow rose 0.1%, S & P 500 ended flat while Nasdaq fell 0.1% after the U.S. Federal Reserve cut interest rates overnight but appeared divided on its next course of action for the year.

The Fed, as expected, cut its benchmark overnight rate by 25 basis points to a range of 1.75% to 2%. It was, however, divided in its decision to lower rates, with three officials dissenting. Central bank officials are also split on further action this year. Five Fed members wanted to keep rates unchanged while five others supported lowering them to the current range and keeping them there. Seven others wanted at least one more rate cut.

Chairman Jerome Powell told reported the Fed could initiate a “sequence” of rate cuts if the economy slows down, but noted he does not see that right now.

Treasury yields pared their losses from earlier in the day.

Brent crude fell 36 cents, or 0.6%, to $64.21 a barrel while WTI  futures settled 2.1% or $1.23 lower at $58.11 a barrel after Trump said he ordered the Treasury Department to “substantially increase” sanctions on Iran. This was a softer stance compared to threat of military action given by him on Sunday.

European markets, except 0.1% lower FTSE, gained 0.1%-0.7%. Retail inflation in Britain rose at an annual rate of 1.7% last month, after a 2.1% increase in July, marking the slowest rate of expansion since December 2016.

AT HOME

Benchmark indices managed to end higher by a fifth of a percent after a rangebound but choppy session. Sensex settled at 36563, up 82 points while Nifty added 23 points to finish at 10840. BSE mid-cap and small-cap indices gained 0.4% and 0.3% respectively. Except 0.4% and 0.1% lower Telecom and Auto indices respectively, all the BSE sectoral indices ended in green with Realty and Metal indices leading the tally, up 1.5% and 1.3% respectively.

FIIs net sold stocks worth Rs 959 cr but net bought index futures and stock futures worth Rs 542 cr and 601 cr respectively. DIIs were net buyers to the tune of Rs 780 cr.

Rupee appreciated 55 paise to end at 71.23/$.

OUTLOOK

Today morning, Nikkei is up more than a percent while Hang Seng and Shanghai are up about a fourth of a percent each. SGX Nifty is suggesting  a modestly lower start for our market.

In yesterday's report we had said that "10746, the low made on 4th September, is the next downside support to eye" while "Immediate hurdle on the hourly chart is placed around 10990, with the stop-loss of which, trading shorts can be held on to".

Nifty, after touching a high of 10885 in the initial trade, slipped to end at 10840 and is set to open modestly lower today.

10746, the low made on 4th September, continues to be next downside support, upon breach of which, 10637, the low made in August, would be the crucial support.

10990 continues to be immediate hurdle, with the stop-loss of which, trading shorts can be held on to.

10746 IS NEXT SUPPORT; 10990 IMMEDIATE HURDLE

10746 IS NEXT SUPPORT; 10990 IMMEDIATE HURDLE

WORLD MARKETS

US indices gained 0.1%-0.4%, waiting to hear from Federal Reserve, which kicked off a two-day monetary policy meeting.

Stocks briefly jumped after President Donald Trump said a U.S.-China trade deal could come soon.

Brent dropped 6.6% or $4.5, to $64.46 per barrel and WTI fell 5.7% or $3.56 to $59.3 after the Saudi energy minister said the country’s oil supply will be back online by the end of the month.

In Europe, CAC rose 0.2% while FTSE and DAX ended marginally in the red.

AT HOME

Sensex and Nifty nosedived 1.7% each to close at the lowest level since 22nd August and 3rd September respectively. Sensex settled at 36481, down 642 points while Nifty lost 185 points to finish at 10817. BSE mid-cap and small-cap indices tumbled 1.8% each. All the BSE sectoral indices ended in red with Auto and Realty indices leading the losses, down 3.8% and 3.7% respectively.

FIIs net sold stocks worth Rs 808 cr but net bought index futures and stock futures worth Rs 592 cr and 365 cr respectively. DIIs were net buyers to the tune of Rs 86 cr.

Rupee depreciated 19 paise to end at 71.78/$.

OUTLOOK

Today morning, Nikkei is little changed while Hang Seng and Shanghai are up about a fifth of a percent. SGX Nifty is suggesting about 50 points higher start for our market.

In yesterday's report we had said that "10945, the low made on Friday, continues to be the immediate support, upon breach of which, 10870, where a trendline adjoining recent bottoms on the daily chart is placed, would be the next support to eye".

Nifty broke 10945 support and plunged all the way to 10796 before closing at 10817.

10746, the low made on 4th September, is the next downside support to eye upon breach of which, 10637, the low made in August, would be the crucial support.

Immediate hurdle on the hourly chart is placed around 10990, with the stop-loss of which, trading shorts can be held on to.

10945 CONTINUES TO BE IMMEDIATE SUPPORT

10945 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS

US indices fell 0.3%-0.5%, with the Dow breaking eight day winning streak, amid fears that a surge in oil prices following an attack in Saudi Arabia could slow down global economic growth.

Brent crude futures surged 19.5% to $71.95 per barrel at the open, the biggest jump on record before closing 14.6% up at $69.02. U.S. crude futures climbed as much as 15.5% to $63.34, the biggest climb since December 2008 and settled at $62.9, up $8.05 or 14.8%.

The attack was claimed by Yemen’s Houthi rebels and the Trump administration has blamed Iran. A Saudi-led military coalition said Monday the attack was carried out by “Iranian weapons” and did not originate from Yemen.

Earlier, data showed China’s industrial production fell to a new 17½-year low. Production rose 4.4% in August as against expectation of a gain of 5.2%.

European markets fell 0.6%-1%.

AT HOME

Benchmark indices tumbled seven tenth of a percent as crude oil shot up nearly 10% following weekend attacks on Saudi oil facilities. Sensex lost 261 points to settle at 37123 while Nifty finished at 11003, down 72 points. Broader indices however outperformed as BSE mid-cap index fell 0.2% while Small-cap index rose 0.6%. BSE Oil & Gas and Energy indices fell 1.6% and 1.3% respectively, becoming top losers among the sectoral indices while Consumer Durable and FMCG indices were the top gainers, up 1.2% and 0.6% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 751 cr, 1634 cr and 397 cr respectively. DIIs were net buyers to the tune of Rs 309 cr.

Rupee depreciated 67 paise to close at 71.59/$.

India's August WPI remained unchanged month-on-month at 1.08%.

OUTLOOK

Today morning, Nikkei is little changed while Hang Seng and Shanghai are off 0.7% and 0.2% respectively. SGX Nifty is suggesting about 20 points lower start for our market.

In yesterday's report we had said that 10945, the low made on Friday, was the immediate support.

Nifty, after touching a low of 10968, recovered to end at 11003 and is se to open lower today.

10945, the low made on Friday, continues to be the immediate support, upon breach of which, 10870, where a trendline adjoining recent bottoms on the daily chart is placed, would be the next support to eye.

11140-11120 continues to be resistance zone.

10860 BELOW 10945; 11140-11220 CONTINUES TO BE RESISTANCE ZONE

10860 BELOW 10945; 11140-11220 CONTINUES TO BE RESISTANCE ZONE

WORLD MARKETS

Dow gained 0.1%, extending the winning streak to eight straight day while S & P 500 and Nasdaq fell 0.1% and 0.2% respectively on Friday.

Sentiment around the trade war improved after the New York Times reported Friday that China will exempt some U.S. agricultural products, including soybeans and pork, from additional tariffs. Earlier on Thursday, US President Trump said he would not rule out an interim trade deal with China.

On the data front, consumer sentiment for September topped expectations as consumers felt better about the economy.

European markets gained 0.2%-0.6%. The euro zone’s trade surplus in goods with the U.S. hit a record high in July. Exports to the U.S. rose to 32.8 billion euros, their highest level since records began in 1999, while imports into the bloc from the U.S. rose to 18 billion euros.

AT HOME

After falling about a third of a percent in the first hour, benchmark indices soared more than a percent from the bottom of the day to end higher by eight tenth of a percent. Sensex settled at 37384, up 280 points while Nifty added 93 points to finish at 11075. BSE mid-cap and small-cap indices rose 0.4% and 0.8% respectively. Except 0.5% and 0.4% lower Telecom and Healthcare indices respectively, all the BSE sectoral indices ended in green with Oil & Gas and Consumer Durable indices leading the tally, up 2.7% and 1.9% respectively.

FIIs net sold stocks worth Rs 405 cr but net bought index futures and stock futures worth Rs 300 cr and 127 cr respectively. DIIs were net buyers to the tune of Rs 210 c.

Rupee appreciated 21 paise to end at 70.91/$.

For the week, Sensex and Nifty gained 1.1% and 1.2% respectively.

Finance minister Nirmala Sitharaman on Saturday announced a slew of measures to boost exports and the flagging housing sector. The first one is a new export promotion scheme for the remission of duties or taxes on export products. This scheme will completely replace Merchandise Exports from India Scheme (MEIS) and Rebate of State Levies (ROSL). The second announcement is the set-up of a Rs 10,000 crore special fund, a special window for affordable and mid-income housing. The fund will provide the last-mile funding for housing projects that are non-NPA and non-NCLT projects and are stuck due to lack of funding.

OUTLOOK

Over the weekend, drone attacks hit Saudi Arabia’s oil production facilities which led to stoppage of half the country’s oil production which represent around 5% of world oil output.  Owing to this Brent is up 11.5% at $67.12 per barrel while WTI is up 10.4% at 60.54 in today’s trade.

Today, Nikkei is shut while Hang Seng is down half a percent and Shanghai is up about 0.4%. SGX Nifty is suggesting about 90 points lower start for our market.

In Friday's report we had reiterated the view that 11140-11220 continues to be next target zone and had advised holding on to long positions with the stop-loss of 10930.

Nifty, after touching a low of 10945, reversed and surged all the way to 11084 before closing at 11075 but is set to open below 11000 today.

10945, the low made on Friday, is the immediate support, upon breach of which, 10860, where a trendline adjoining recent bottoms on the daily chart is placed, would be the next support to eye.

11141-11220 continues to be upside target/resistance zone where 11141 and 11181 are the tops made on 27th August and 9th August respectively while 11220 is where 200-DMA is placed.

TRAIL STOP-LOSS TO 10930

TRAIL STOP-LOSS TO 10930

WORLD MARKETS

US indices gained 0.2%-0.3% after digesting a slew of U.S.-China trade news along with a large bond buying program from Europe’s central bank.

President Trump agreed on Wednesday to delay an additional increase in tariffs on Chinese goods by two weeks “as a gesture of good will.

Yesterday, indices touched session highs after Bloomberg News reported that Trump’s advisors were considering an interim deal with China but came off the day high after a senior White House official denied such a deal.

European Central Bank cut its deposit rate to a record low -0.5% from -0.4% and said it will restart bond purchases of 20 billion euros a month from November to prop up euro zone growth.

Brent crude futures fell 74 cents, or 1.2%, to $60.07 a barrel while WTI futures fell 92 cents, or 1.7%, to $54.83 after a media report cast doubt on the possibility of an interim U.S.-China trade deal and as a meeting of the OPEC+ alliance yielded no decision on deepening crude supply cuts.

European markets rose 0.1%-0.9%.

AT HOME

After gaining nearly half a percent in the initial trade, benchmark indices reversed these gains through the sessions to end lower by about half a percent, with Nifty breaking 5-day winning streak. Sensex settled at 37104, down 166 points while Nifty lost 53 points to finish at 10982. BSE mid-cap index fell 0.2% while small-cap index rose 0.1%. BSE Auto and Telecom indices tumbled 1.9% and 1.7% respectively, becoming top losers among the sectoral indices while Finance index rose 0.4%, becoming top gainer, followed by 0.2% higher Bankex and Capital Goods indices.

FIIs net bought stocks worth Rs 784 cr but net sold index futures and stock futures worth Rs 1006 cr and 200 cr respectively. DIIs were net sellers to the tune of Rs 127 cr.

Rupee appreciated 52 paise to end at 71.13/$.

July IIP growth came in at 4.3%, up from 2% growth registered in June. August CPI rose marginally to 3.21% from 3.15% in July.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.2%-0.9% and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had reiterated the view that 11140-11220 continues to be next target zone and had advised holding on to long positions with the stop-loss of 10900.

Nifty, after touching a high of 11081, slipped to end at 10982 and is set to open little changed today.

11140-11220 continues to be upside target/resistance zone to eye.

Immediate support on the hourly chart has moved up to 10930, with the stop-loss of which, existing longs can be held on to.