ALL EYES ON THE FED

 

ALL EYES ON THE FED

 

WORLD MARKETS

 

After opening with gains of nearly a percent, Dow and S & P 500 slipped to end marginally in the red while Nasdaq managed to gain 0.2%.

 

Fed finishes its two-day policy meeting today and markets are awaiting cues on central bank’s plans to taper its bond buying. The Fed will also release its quarterly economic forecasts, the so-called dot plot, along with the statement on interest rates. Fed Chair Powell will have a press conference after the announcements.

 

US 10-year treasury yield ticked up 1.4 basis points to trade at 1.323%. Dollar index was down nearly 0.1% at 93.233. Spot gold rose 0.7% to $1,776 per ounce.

 

Brent crude gained 44 cents, or 0.6%, to settle at $74.36 per barrel and WTI future gained 27 cents, or 0.4%, to settle at $70.56.

 

European markets gained 1.1%-1.5%.

 

AT HOME

 

After falling four tenth of a percent, benchmark indices soared 1.4% from the bottom of the day to end higher by nearly a percent, recouping most of the yesterday's losses. Sensex settled at 59005, up 514 points while Nifty added 165 points to finish at 17562. Nifty mid-cap index gained 0.6% but small-cap index fell 0.1%. BSE Realty and Metal indices climbed 3.5% and 2.6% respectively, becoming top gainers among the sectoral indices, while Utilities and Power indices were the top losers, down 0.6% and 0.5% respectively.

 

FIIs net bought stocks and index futures worth Rs 1042 cr and 284 cr respectively but net sold stock futures worth Rs 177 cr. DIIs were net buyers to the tune of Rs 2168 cr.

 

Rupee appreciated 12 paise to end at 73.61/$.

 

OUTLOOK

 

Markets in Hong Kong and South Korea are closed today for holidays. Other Asian markets are trading with cuts of 0.2%-0.4%. SGX Nifty is suggesting a flattish start for our market.

 

In yesterday's report we had said that 17300-17250 continued to be next support zone while 17623, the top made Monday, was the immediate hurdle.

 

Nifty, after touching a low of 17326, reversed to touch a high of 17578 before closing at 17562.

 

17623, the top made Monday, continues to be the immediate hurdle, above which, 17793, the top made last week, would be the bigger resistance to eye; 17300-17250 continues to be support zone.

 

37450-37500 is the immediate resistance zone for Banknifty, upon crossover of which, 37800, 38100 would be subsequent upside levels to eye; 36350-36150 is the support zone.

 

17300-17250 IS THE NEXT SUPPORT ZONE; 17623 IMMEDIATE HURDLE

 

17300-17250 IS THE NEXT SUPPORT ZONE; 17623 IMMEDIATE HURDLE

 

WORLD MARKETS

 

US indices nosedived 1.7%-2.2% on concerns including the imminent Federal Reserve meeting, liquidity crisis at China Evergrande Group, the lingering delta variant and the debt ceiling deadline. S & P 500 fell the most since May 12 while Dow had its biggest one-day drop since July 19.

 

Fed begins its two-day policy meeting today and markets are awaiting cues on central bank’s plans to taper its bond buying.

 

Hang Seng index plunged 4% as China’s second-largest property developer, Evergrande, is on the brink of default and fear is that the pain that could come from its collapse would extend beyond China. A deadline for an $83.5 million interest payment on one of its bonds is due today, and the company has $305 billion in liabilities.

 

Delta variant remains a global health threat as the colder months approach and vaccination hesitancy persists among some Americans. Markets are also concerned about the deadline to raise the debt ceiling and possible tax increase.

 

US 10-year treasury yield dropped 6 basis points to 1.311%. Dollar index rose 0.025%. Spot gold rose 0.5% to $1,762.66 per ounce.

 

Brent crude fell $1.42, or 1.9%, to $73.92 a barrel while while WTI declined $1.68 or 2.3% to $70.29.

 

European markets fell 0.9%-2.6%.

 

AT HOME

 

Sensex, Nifty nosedived 0.9% and 1.1% respectively, suffering the biggest fall in 2-months. Sensex settled at 58490, down 525 points while Nifty lost 188 points to finish at 17396. Nifty mid-cap and small-cap indices tumbled 2.2% and 1.7% respectively, with the former having worst day in more than 5 months. Except 0.7% higher FMCG index, all the BSE sectoral indices ended in red, with Metal index being the top loser, down 6.8%, followed by 4.1% lower Basic Materials index.

 

FIIs net bought stocks worth Rs 93 cr but net sold index futures and stock futures worth Rs 2560 cr and 653 cr respectively. DIIs were net sellers to the tune of Rs 1627 cr.

 

Rupee depreciated 26 paise to end at 73.73/$.

 

OUTLOOK

 

Markets in mainland China and South Korea are closed today for a holiday. Nikkei is down nearly 2% while Hang Seng is marginally higher. SGX Nifty is suggesting around 40 points higher start for our market.

 

In yesterday's report we had said that 17793, the top made Friday, was the immediate hurdle to eye while immediate support on the hourly chart was placed around 17450, upon breach of which, 17300-17250 would be the next support zone.

 

Nifty broke 17450 support and plunged all the way to 17362 before closing at 17396.

 

17300-17250 continues to be next support zone to eye.

 

17623, the top made yesterday, is the immediate hurdle, above which, 17793, the top made last week, would be the bigger resistance to eye.

 

36850 continues to be immediate support for Banknifty, below which, 36350-36150 would be the next support zone; 38113, the top made Friday, is the immediate hurdle.

TRAIL THE STOP-LOSS TO 17450

 

TRAIL THE STOP-LOSS TO 17450

 

WORLD MARKETS

 

Dow fell half a percent while S & P 500 and Nasdaq slipped 0.9% each on Friday, weighing the prospect of slowing global economic growth and awaiting a Federal Reserve meeting this week.

 

The University of Michigan’s gauge of consumer sentiment rebounded slightly to a preliminary September reading of 71 from a final August reading of 70.3.

 

US 10-year treasury yield advanced by 4 basis points to 1.37%. Dollar index climbed 0.4% to 93.25, hitting its highest level in three weeks. Gold futures fell 0.3% to $1751.40 an ounce.

 

Brent crude fell 33 cents to settle at $75.34 a barrel while WTI fell 64 cents to $71.97.

 

European markets fell 0.8%-1%. U.K. retail sales fell unexpectedly in August, dropping 0.9% month-on-month against a forecast for a 0.5% rise.

 

For the week, US and European markets ended with modest cuts while Hang Seng and Shanghai nosedived 5.8% and 2.6% respectively as concerns about China’s regulatory crackdown and slowing global growth weighed on sentiment. Indian and Japanese equities however gained 1.2% and 0.3% respectively. For the week, Dow and S & P 500 eased 0.1% and 0.6% respectively for their third and second straight week of losses respectively. The Nasdaq Composite dropped 0.5%.

 

In other asset classes, Brent crude gained 3.3% and U.S. crude was up 3.2%, supported by tight supplies due to the hurricane outages and data showing a larger-than-expected drawdown in U.S. crude inventories. Dollar index rose 0.7% to reach 93.25 and Gold fell 1.9% after an unexpected increase in U.S. retail sales raised expectations that the Fed may reduce its stimulus sooner.

 

AT HOME

 

After climbing just under a percent, benchmark indices nosedived more than a percent to end lower by a fifth of a percent, snapping 3-day winning streak. Sensex settled 125 points to settle at 59015 while Nifty lost 44 points to finish at 17585. Nifty mid-cap and small-cap indices slipped 1.3% and 0.7% respectively. BSE Metal and Realty indices tumbled 2.5% and 2% respectively, becoming top losers among the sectoral indices while Bankex and Finance indices were the top gainers, up 0.9% and 0.3% respectively.

 

FIIs net bought stocks and index futures worth Rs 1622 cr and 235 cr respectively but net sold stock futures worth Rs 1878 cr. DIIs were net sellers to the tune of Rs 795 cr.

 

Rupee appreciated 4 paise to end at 73.47/$.

 

For the week, Sensex as well as Nifty gained 1.2% each, extending the winning streak to fourth consecutive week.

 

OUTLOOK

 

Markets in mainland China, Japan and South Korea are closed today for holidays. Hang Seng is trading with cut of more than 2%. SGX Nifty is suggesting around 130 points lower start for our market.

 

In Friday's report we had said that 17900, where an upward sloping trendline adjoining recent tops on the daily chart was placed, was the next target to eye and had advised trailing the stop-loss in long positions to 17430.

 

Nifty, after making a top of 17793, slipped to 17537 before closing at 17585. The benchmark is set to open below 17500 today.

 

17793, the top made on Friday, is the immediate hurdle to eye, upon crossover of which, 18000, where a rising trendline adjoining recent tops is placed, would be the next upside level to eye.

 

On the way down, immediate support on the hourly chart is placed around 17450, upon breach of which, 17300-17250 would be the next support zone.

 

Meanwhile, trading longs can be held on to with the stop-loss of 17460.

 

For Banknifty, 38113, the top made Friday, is the immediate hurdle, upon crossover of which, 38800-38900 would be the next target zone. 36850 is the immediate support, with the stop-loss of which, trading longs can be held on to.

 

TRAIL STOP-LOSS TO 17430

 

TRAIL STOP-LOSS TO 17430

 

WORLD MARKETS

 

After falling about 0.8% each, Dow and S & P 500 rebounded to end lower by 0.2% each while Nasdaq inched up 0.1%.

 

August retail sales unexpectedly increased 0.7% for the month against the estimate of a decline of 0.8%. Weekly jobless claims increased to 332,000 for the week ended Sept. 11, the estimated figure being 320,000.

 

US 10-year treasury yield rose 3.2 basis points to 1.336%. Dollar index surged 0.5% to 92.866, hitting its highest level since Aug. 27. Spot gold slid 2.1% to $1,755.75 per ounce.

 

Brent crude rose 21 cents, or 0.3%, to $75.67 a barrel while WTI was unchanged at $72.61.

 

In Europe, FTSE and DAX inched up 0.2% each while CAC climbed 0.6%.

 

AT HOME

 

Bull rampage continued as Sensex and Nifty climbed 0.7% and 0.6% respectively, extending the winning streak to third straight day and hitting fresh record highs. Sensex added 418 points to settle at 59149 while Nifty finished at 17629, up 110 points. Nifty mid-cap and small-cap indices gained 0.4% and 0.2% respectively. BSE Bankex and Energy indices climbed 2.1% and 1.7% respectively, becoming top gainers among the sectoral indices while IT and Basic Materials indices slipped 0.7% each, becoming the top losers, followed by 0.6% lower Metal and Teck indices.

 

FIIs net bought stocks and index futures worth Rs 1622 cr and 235 cr respectively but net sold stock futures worth Rs 1878 cr. DIIs were net sellers to the tune of Rs 795 cr.

 

Rupee depreciated 3 paise to end at 73.52/$.

 

Finance Minister Nirmala Sitharaman announced that the government will back guarantees worth Rs 30,600 crore for the National Asset Reconstruction Company, which will take over bad loans worth Rs 2 lakh crore from banks.

 

OUTLOOK

 

Today morning, Asian markets are trading with gains of 0.1%-0.6% and SGX Nifty is suggesting around 80 points higher start for our market.

 

In yesterday's report we had said that 17600-17650 was the next target zone to eye and had advised trailing the stop-loss in long positions to 17370.

 

Nifty soared to 17644 before closing at 17629, achieving the target mentioned above and vindicating our view. The benchmark is set to open near 17700 today.

 

17900, where an upward sloping trendline adjoining recent tops on the daily chart is placed, is the next target to eye.

 

Immediate support on the hourly chart has moved up to 17430, with the stop-loss of which, trading longs can be held on to.

 

38100-38200 is the next target zone for Banknifty; 37100 is immediate support, with the stop-loss of which, trading longs can be held on to.

 

TRAIL SL TO 17370

 

TRAIL SL TO 17370

 

WORLD MARKETS

 

US indices gained 0.7%-0.8%, with the Nasdaq snapping a 5-day losing streak  and S & P 500 posting its biggest gain in the month so far.

 

Economic data was mixed. U.S. manufacturing output slowed in August, rising 0.2% from a 1.6% increase the previous month. Import prices fell unexpectedly in August and a New York Fed’s business survey showed a higher-than-expected reading.

 

US 10-year treasury yield ticked up 2.2 basis points to 1.301%. Dollar index eased 0.1% to 92.546. Spot gold fell 0.6% to $1,793.81 per ounce.

 

Brent oil jumped $1.86, or 2.5%, to $75.46 per barrel, while WTI crude climbed $2.15, or 3.05%, to settle at $72.61 per barrel after industry data showed a larger-than-expected drawdown in U.S. crude inventories.

 

Main European markets fell 0.25%-1%. U.K. inflation soared to a nine-year high in August, with consumer prices rising 3.2% y-o-y after a 2% annual rise in July.  Euro zone industrial production for July rose 1.5% month-on-month and 7.7% annually against expectations of 0.6% and 6.3% increases.

 

China’s retail sales for August grew 2.5%, much lower than the 7% expectation.

 

AT HOME

 

Benchmark indices climbed 0.8% each to hit fresh record highs. Sensex added 476 points to settle at 58723 while Nifty finished at 17519, up 139 points. Nifty mid-cap and small-cap indices surged 1% and 0.6% respectively and also hit fresh record highs. All the BSE sectoral indices ended in green, with Telecom and Utilities indices on the top, up 3.4% and 2.3% respectively.

 

FIIs net bought stocks and index futures worth Rs 233 cr and 171 cr respectively but net sold stock futures worth Rs 255 cr. DIIs were net sellers to the tune of Rs 168 cr.

 

Rupee appreciated 19 paise to end at 73.49/$.

 

OUTLOOK

 

Today morning, Nikkei and Hang Seng are down 0.25% and 1% respectively while Shanghai is up 0.2%. SGX Nifty is suggesting a flattish start for our market.

 

In yesterday's report we had said that 17430-17440 was the congestion zone, upon decisive crossover of this, 17600-17650 would be the next target zone and  had advised holding on to trading longs can be held on to with the stop-loss of 17200. 

 

Nifty crossed 17440 hurdle and surged all the way to 17532 before closing at 17519.

 

17600-17650 is the next target zone to eye.

 

Immediate support on the hourly chart has moved up to 17370, with the stop-loss of which, trading longs can be held on to.

 

37140, 37700 are the upside levels for Banknifty; 36500 is immediate support.

 

STAY LONG WITH THE STOP-LOSS OF 17200

 

STAY LONG WITH THE STOP-LOSS OF 17200

 

WORLD MARKETS

 

After a positive start on the back of better-than-feared inflation reading, US indices saw a sustained downward move through the session to end with cuts of 0.5%-0.8%.

 

August consumer price index rose 0.3% month-on-month, or 5.3% y-o-y, below the 0.4% increase and 5.4% annual gain expected. Core CPI, which excludes volatile food and energy prices, increased 4.0% after gaining 4.3% in July and rose just 0.1% month-on-month, coming in below expectations of 0.3%.

 

US 10-year treasury yield fell 4.7 basis points to 1.277%. Dollar index, after starting lower at 92.32, rebounded to end little changed near 92.60. Spot gold rose 0.6% to $1,803.69 per ounce.

 

Brent crude rose 13 cents, or 0.2% to $73.64 a barrel while WTI crude was unchanged at $70.45.

 

In Europe, FTSE and CAC fell 0.5% and 0.4% respectively, while DAX inched up 0.1%.

 

AT HOME

 

After rising half a percent at the open, benchmark indices gave away most of the gains to end just marginally higher. Sensex settled at 58247, up 69 points while Nifty added 24 points to finish at 17380. Nifty mid-cap index soared 1.2% while small-cap index added 0.3%. BSE Utilities and Consumer Discretionary Goods & Services indices climbed 1.6% and 1.3% respectively, becoming top gainers among the sectoral indices, while Metal and FMCG indices were the top losers, down 0.4% and 0.2% respectively.

 

FIIs net bought stocks worth Rs 1650 cr but net sold index futures and stock futures worth Rs 197 cr and 196 cr respectively. DIIs were net sellers to the tune of Rs 310 cr.

 

Rupee depreciated 1 paise to end at 73.68/$.

 

OUTLOOK

 

Today morning, Asian markets are trading with cuts of 0.4%-1.2% but SGX Nifty is suggesting around 25 points higher start for our market.

 

In yesterday's report, we had said that, 17436, the top made last week, continued to be immediate hurdle, upon crossover of which, 17600-17650 would be the next target zone and had advised holding on to long positions with the stop-loss of 17200.

 

Nifty, after touching a high of 17438 in the initial trade, slipped to end at 17380.

 

17430-17440 is the congestion zone, where Nifty is repeatedly getting resisted. Upon decisive crossover of this, 17600-17650 would be the next target zone.

 

17250-17200 continues to be the support zone and trading longs can be held on to with the stop-loss of 17200. 

 

36151, the low made last week, continues to be the immediate support for Banknifty; 37140, the top made on 3rd September, is the immediate hurdle.

 

STAY LONG WITH THE STOP-LOSS OF 17200

 

STAY LONG WITH THE STOP-LOSS OF 17200

 

WORLD MARKETS

 

Dow and S&P 500 gained 0.8% and 0.2% respectively to snap 5-day losing streak while Nasdaq eased 0.1% for its fourth straight negative session. Energy stocks jumped on the back of rising oil prices and led the gainers. Stocks linked to the economic reopening also gained after the seven-day daily U.S. Covid case average declined to around 144,300, down from roughly 167,600 cases per day at the beginning of the month.

 

US 10-year treasury yield fell by 1.5 basis points to 1.326%. The dollar index, after rising to two-week high of 92.887, eased to end flat at 92.664. Spot gold rose 0.4% to $1,795.20 per ounce.

 

Brent crude rose 0.8% to settle at $73.51 per barrel and WTI crude gained 1.05% to finish at $70.45.

 

European markets gained 0.2%-1.4%.

 

AT HOME

 

Sensex and Nifty fell 0.1% and 0.2% respectively, extending last couple of days' consolidation. Sensex lost 127 points to settle at 58177 while Nifty finished at 17355, down 14 points. Nifty mid-cap and small-cap indices extended the outperformance, rising 0.4% and 0.5% respectively. BSE Metal and Utilities climbed 1.5% and 1.2% respectively, becoming top gainers among the sectoral indices while Energy index and Bankex were the top losers, down 1.5% and 0.5% respectively.

 

FIIs net bought stocks worth Rs 1419 cr but net sold index futures and stock futures worth Rs 647 cr and 1160 cr respectively. DIIs were net sellers to the tune of Rs 560 cr.

 

Rupee depreciated 17 paise to end at 73.67/$.

 

India's August CPI slowed to 4-month low of 5.30% from 5.59% in July. Core CPI eased to 5.8% from 6%.

 

OUTLOOK

 

Today morning, Nikkei is up 0.8% while Shanghai and Hang Seng are off nearly half a percent each. SGX Nifty is suggesting around 50 points higher start for our market.

 

In yesterday's report, we had said that, 17436, the top made last week, continued to be immediate hurdle, upon crossover of which, 17600-17650 would be the next target zone. We had also said that 17250-17200 continues to be the support zone and trading longs could be held on to with the stop-loss of 17200.

 

Nifty, after touching a low of 17269, rebounded to end at 17355 and is set to open near 17400 today.

 

17436, the top made last week, continues to be immediate hurdle, upon crossover of which, 17600-17650 would be the next target zone.