9530 ABOVE 9450; TRAIL STOP-LOSS TO 9370

9530 ABOVE 9450; TRAIL STOP-LOSS TO 9370

WORLD MARKETS                             

US indices gained 0.4%-0.5% with S & P 500 and Nasdaq closing at fresh record high on the back of rise in tech and oil prices.

WTI and Brent oil climbed nearly 2% each to $48.85 and $51.82 a barrel respectively after the Russian and Saudi energy ministers said the two countries agreed to extend a production cut until March 2018.

Large cap tech and cybersecurity stocks gained after a "ransomware" virus dubbed WannaCry hit 200,000 computers in more than 100 countries on Friday.

National Association of Home Builders survey showed sentiment among home builders came in at 70 for May, up from 58 in May of last year. The Empire State manufacturing index dropped to negative 1 in May from a print of 5.2 last month.

Dollar index fell to 98.879.

European markets gained 0.3%-0.6% on the back of a regional election win for German Chancellor Angela Merkel's party and extended oil output cuts.

AT HOME

Benchmark indices added half a percent to close at fresh record high. Sensex settled at 30322, up 134 points while Nifty gained 44 points to finish at 9445. BSE mid-cap and small-cap indices soared 1.2% and 0.8% respectively. BSE Metal and Basic Material indices were the top gainers among the sectoral indices, rising 2.4% and 1.6% respectively whereas Telecom and Teck indices were the top losers, down 0.9% and 0.5% respectively.

FIIs net bought stocks and stock futures worth Rs 235 cr and 191 cr respectively but net sold index futures worth Rs 117 cr. DIIs were net sellers to the tune of Rs 66 cr.

Rupee appreciated 26 paise to end at a fresh 21-month high of 64.05/$.

Vedanta's overall earnings beat street expectations. The company posted consolidated net profit of Rs 2988 cr as against loss of Rs 21103 cr (which included an exceptional loss of Rs 12312 cr). Revenue rose 40.5% to Rs 23691 cr. Operating profit more than doubled to Rs 7350 cr and margin expanded by 1060 bps to 32.7%.

India's exports and imports rose 19.8% and 49% respectively in April, leaving a trade deficit of $13.2 bn.

Oil marketing companies cut petrol and diesel prices by Rs 2.16 and Rs 2.10 per litre.

OUTLOOK

Today Nikkei is up above half a percent but other Asian markets are trading with cuts of 0.2%-0.6%. SGX Nifty is suggesting about 10 points higher start for our market.

In yesterday's report we had mentioned that 9451, the top made last week, is the immediate hurdle above which 9530 would be the next target to eye.

Nifty gained 44 points to close at 9445 and is set to open higher today. As mentioned above 9530 would be the next target upon a sustained crossover of 9450.

Immediate support on the hourly chart has moved up to 9370, with the stop-loss of which, trading longs should be held on to.

Tata Steel and PNB will report their quarterly earnings today.

STAY LONG WITH THE STOP-LOSS OF 9330; 9530 ABOVE 9450

STAY LONG WITH THE STOP-LOSS OF 9330; 9530 ABOVE 9450

WORLD MARKETS                             

Dow and S & P 500 fell 0.1% and 0.2% respectively while Nasdaq gained 0.1% on Friday after economic data proved to be a mixed bag, and on the back of the drop in retails stocks.

J.C. Penney plunged 14% after earnings topped expectations but same-stores sales fell more than expected.

Retail sales increased 0.4% in April from March, less than expected. Consumer prices rose 0.2% in April, in line with expectations. In the 12 months through April, the CPI increased 2.2%, down from March's 2.4% read.

Treasury yields fell on the back of the data. The benchmark 10-year note yield slipped to trade near 2.32%, while the two-year note yield hovered near 1.29%. Dollar index fell half a percent to 99.20.

Oil prices settled slightly higher.

European market gained 0.3%-0.7%. Provisional data from Germany showed the economy grew by 0.6% in the first-quarter.

For the week, Dow and S & P 500 fell 0.4% and 0.2% respectively, breaking 3-week winning streak. Nasdaq gained 0.2%. In Europe, while FTSE soared 1.2%, DAX ended flat while CAC lost 0.9%.

G7 finance ministers and central bankers highlighted the risks the Trump administration's trade policies could pose to global growth during their meeting in Italy. This follows an earlier meeting in March this year, when G20 leaders failed to endorse free trade in their joint communique.

Concerns over North Korea's nuclear program grew after the hermit state launched a new missile over the weekend.

AT HOME

Benchmark indices ended lower by a fifth of a percent on the last day of the week, breaking four-day winning streak. Sensex lost 63 points to settle at 30188 while Nifty finished at 9401, down 21 points. BSE mid-cap and small-cap indices fell 0.7% and 0.8% respectively. BSE Consumer Durable index was the top loser among sectoral indices, down 1%, followed by 0.9% cut in Finance index and Bankex. BSE IT and Realty indices were the top gainers, up 1.2% and 0.8% respectively.

FIIs net bought stocks worth Rs 842 cr but net sold index futures and stock futures worth Rs 916 cr and 191 cr respectively. DIIs were net sellers to the tune of Rs 711 cr.

Rupee appreciated 8 paise to end at 64.30/$.

Dr Reddy reported 175% rise in March quarter net profit at Rs 337.6 cr due to low base. Revenue fell 4.8% to Rs 3612 cr. Consolidated operating profit rose 31.3% to Rs 630 cr and margin expanded by 490 bps to 17.7%. All the parameters fell short of expectation.

European markets, except a marginally lower CAC, were trading with gains of upto 0.5%.

The government on Friday revised the base year for wholesale price index (WPI)-based inflation  and the Index of Industrial Production (IIP) to 2011-12 from 2004-05. As per the new series, April WPI inflation eased to four-month low of 3.85% from 5.29% in March. March IIP growth improved to 2.7% from 1.9% in February. The Consumer Price Index-based inflation in April stood at 2.99%, down from 3.81% in March and a record low. Core CPI fell to 4.5% from 4.9%.

OUTLOOK

Today morning, except a modestly lower Nikkei, other Asian markets are trading with gains of 0.3%-0.5% and SGX Nifty is suggesting about 35 points higher start for our market.

Readers would recall that we had given a target of 9470 after immediate target of 9350 was achieved. Nifty, after touching a high of 9451 on Thursday, slipped to end at 9401 on Friday, but is set to open higher today.

9450, the top made last week, is the immediate hurdle above which 9530 would be the next target to eye.

9330 continues to be immediate support, with the stop-loss of which trading longs should be held on to.

STAY LONG WITH THE STOP-LOSS OF 9330

STAY LONG WITH THE STOP-LOSS OF 9330

WORLD MARKETS                             

US indices fell 0.1%-0.2% with retail stocks taking a plunge on the back of Macy's weak quarterly results.

Producer price index rose 0.5% in April, more than the expected increase of 0.2%. Initial jobless claims totaled 236,000, below the expected 245,000.

Dollar index, after touching a high of 99.88, gave away all the gains to end at 99.65.

WTI and Brent oil gained a percent to settle at $47.83 and $50.72 a barrel respectively.

European markets, except a flat FTSE, fell 0.3%-0.4%. Basic resources however bucked the trend, buoyed by rising oil prices and major gains for mining giants Fresnillo and Polymetal. The Bank of England left interest rates unchanged at 0.25% but lowered its growth projections for the United Kingdom. Sterling fell shortly after the decision as some investors had expected more than one vote for a rate rise. Meanwhile, UK industrial production shrank 0.5% in March.

AT HOME

After opening higher by half a percent, benchmark indices gave away most of the gains through the session to end just marginally higher. Sensex settled at 30250, up 3 points while Nifty added 15 points to finish at 9422. BSE mid-cap index ended 0.05% higher while small-cap index lost 0.05%. BSE Consumer Durable and Consumer Discretionary Goods & Services indices gained 1.6% and 1.2% respectively, becoming top gainers among the sectoral indices while Power and Utilities indices were the top losers, down 1.2% and 1% respectively.

FIIs net bought stocks and stock futures worth Rs 1307 cr and 434 cr respectively but net sold index futures worth Rs 155 cr. DIIs were net sellers to the tune of Rs 1037 cr.

Rupee appreciated 25 paise to end at 64.37/$.

HCL Technologies reported better than expected results in terms of revenue, EBIT as well as dollar revenue for the quarter ended March 31. Dollar revenue rose 4.1% q-o-q to $1817 mn while constant currency growth stood at 3.8%. Rupee revenue grew 2% to Rs 12053 cr and net profit was up 20.8% at Rs 2325 cr. For FY18, the company guided for a revenue growth of 10.5-12.5% in constant currency terms while EBIT margin guidance stood at 19.5-20.5%.

Asian Paints reported 7.8% y-o-y growth in topline at Rs 3852 cr. EBIDTA rose 2.2% to Rs 712 cr and margin contracted by 100 bps to 18%. Net Profit rose 10.3% to Rs 480 cr. Volume growth at 10% was better-than-expected.

OUTLOOK

Today morning, Asian markets, except a marginally higher Hang Seng, are trading with modest cuts and SGX Nifty is suggesting a flattish start for our market.

We had given a target of 9470 after Nifty broke out of 9370-9270 consolidation. The benchmark yesterday touched a high of 8451, moving very close to the 9470 target, but slipped from there to end at 9422.

9470-9500 continues to be the next target area to eye. Immediate support on the hourly chart has moved up to 9330, with the stop-loss of which trading longs should be held on to.

Dr Reddy, Titan and Nestle will report their quarterly earnings today.

The government today will release the new Index of Industrial Production (IIP) and Wholesale Price Index (WPI) series with 2011-12 base year replacing the 2004-05 base years. IIP for March is expected to show a growth of 1.5%, up from a decline of 1.2% in February. April CPI is expected at 3.49%, down from 3.81% in March. April WPI is expected to ease to 4.79% from 5.70%.

NIFTY BREAKS OUT OF 8-DAY CONSOLIDATION; 9470 NEXT

NIFTY BREAKS OUT OF 8-DAY CONSOLIDATION; 9470 NEXT

WORLD MARKETS                             

While Dow fell 0.2%, S & P 500 and Nasdaq gained 0.1% each with S & P 500 and Nasdaq posting a record close and Nasdaq posting a 5-day winning streak after digesting Trump's firing of FBI Director James Comey.

The White House claimed the sudden termination of Comey's contract was over his handling of Hilary Clinton's emails. However, Democrats said the decision was most likely as a result of the FBI investigating alleged links between the Trump campaign and Russia.

In economic news, mortgage applications rose 2.4% on a seasonally adjusted basis last week. Import prices rose 0.5%, more than expected.

Oil bounced back more than 3% with WTI and Brent at $47.33 and $50.54 respectively after U.S. inventories fell 5.25 mn barrels, their largest one-week drop this year.

Dollar index extend the upmove, rising about 0.1% to 99.63.

European markets gained upto 0.6% with FTSE on top.

AT HOME

Benchmark indices soared a percent in today's trade to close at fresh record high. Sensex added 315 points to settle at 30248 while Nifty finished at 9407, up 90 points. BSE mid-cap and small-cap indices gained 0.9% and 0.8% respectively.  Except a 0.4% and 0.2% lower IT and Realty indices respectively, all the BSE sectoral indices ended in green with Telecom index leading the tally, up 4.6%, followed by 1.8% rise in FMCG index.

FIIs net bought stocks and stock futures worth Rs 893 cr and 383 cr respectively but net sold index futures worth Rs 395 cr. DIIs were net sellers to the tune of Rs 230 cr.

Currency market was shut on account of "Buddha Purnima".

Hero MotoCorp reported 13.9% y-o-y dip in quarterly net profit at Rs 718 cr. Total income fell 7% to Rs 7488 cr. EBIDTA fell 19.5% to Rs 957.6 cr and margin was 13.9%, down from 15.8%.

OUTLOOK

Today morning, except about half a percent lower Shanghai, other Asian markets are trading with modest gains and SGX Nifty is suggesting about 25 points higher start for our market.

At the risk of repeating, while Nifty was in a consolidation mode for eight consecutive sessions, we had maintained our positive bias and had said that once 9370 hurdle is taken out, 9470 would be the next upside target.

Nifty finally broke out of this long consolidation yesterday, touched a high of 9415 and closed at 9407.

9470 continues to be immediate upside target. Immediate support on the hourly chart has now moved up to 9330, with the stop-loss of which long positions should be held on to.

HCL Tech and Asian Paints will report their quarterly earnings today. HCL Tech is expected to show a dollar revenue growth of 4% but around 40 bps dip in margin. Markets would watch out for FY18 guidance. In case of Asian Paint, key parameter, volume growth, is expected between 7-8%.

CONSOLIDATION CONTINUES

CONSOLIDATION CONTINUES

WORLD MARKETS                             

Dow and S & P 500 fell 0.2% and 0.1% respectively while Nasdaq gained 0.3% yesterday. Comments from North Korea indicating the country would continue with its nuclear tests weighed on the sentiment.

In economic news, the NFIB survey showed small-business confidence slipped in April. Wholesale inventories for March rose 0.2% as against expectation of a 0.1% decline. The JOLTs (job openings and labor turnover survey) showed job openings totaled 5.7 million in March.

Dollar strengthened for the third consecutive day, rising about 0.4% to 99.54.

WTI crude fell 1.2% to close at the lowest level since Nov 29, the day before the Organization of the Petroleum Exporting Countries (OPEC) agreed to cut production during the first half of 2017.

European markets gained 0.3%-0.6%. German imports and exports hit a record high in March.

Back in the US FBI Director James Comey was fired by U.S. President Donald Trump on the recommendation of Attorney General and Deputy Attorney General.

AT HOME

Benchmark indices ended little changed after trading in a narrow range through the day, extending the consolidation to eighth straight day. Sensex settled at 29933, up 7 points while Nifty added 3 points to finish at 9317. BSE mid-cap and small-cap indices outperformed yet again, rising 0.2% and 0.5% respectively. BSE Capital Goods and Industrial indices climbed 1.9% and 1.3% respectively, becoming top gainers among the sectoral indices while Telecom and Consumer Durable indices were the top loser, down 0.8% and 0.6% respectively.

FIIs net bought stocks worth Rs 333 cr but net sold index futures and stock futures worth Rs 1083 cr and 594 cr respectively. DIIs were net buyers to the tune of Rs 17 cr.

Rupee depreciated 32 paise to end at 64.63/$.

IMD said India is likely to receive above average monsoon rainfall as concern over the El Nino weather condition has eased in the past few weeks.

Bharti Airtel reported worse than expected 69% fall in quarterly profit at Rs 471 cr. Net sales dropped 12% to Rs 21935 cr. EBIDTA margin fell to 36.4% from 36.72% but were better-than-expected. There was a sharp decline in voice and data RPM while volumes jump.

OUTLOOK

Today morning SGX Nifty is suggesting about 15-20 points higher start for our market.

Yesterday was the eight day of consolidation as Nifty traded within the 100 point 9370-9270 range. A breach of this range, on either side, is required for a fresh directional view.

Above 9370, 9470 would be the next upside target. Below 9270, 34-DMA, placed around 9200, would be the next downside target.

Existing longs can be held on to with the stop-loss of 9270.

Hero MotoCorp, Zee Entertainment and Siemens will report their quarterly earnings today.

SEVENTH CONSECUTIVE DAY OF CONSOLIDATION WITHIN 9370-9270 RANGE

SEVENTH CONSECUTIVE DAY OF CONSOLIDATION WITHIN 9370-9270 RANGE

WORLD MARKETS                             

US indices ended flat to marginally higher.

Cleveland Fed President Loretta Mester, in a speech, said "We have met the maximum employment part of our mandate and inflation is nearing our 2% goal." St. Louis Federal Reserve President James Bullard however struck a more dovish note by saying that continued strong demand for safe assets along with sluggish growth in the U.S. workforce will hold down U.S. interest rates for the foreseeable future.

Dollar index gained 0.6% to 99.16.

U.S. crude rose 21 cents to settle at $46.43 a barrel while Brent crude added 24 cents to settle at $49.34.

Earlier data showed China's exports grew 8% y-o-y in April, slowing from a 16.4% rise in March. Imports rose 11.9%, down from 19.8% growth in March.

European market, except a marginally higher FTSE, fell 0.2%-0.9%. Basic resources fell after weak iron ore imports data from China. The euro briefly climbed above $1.10 against the dollar for the first time in six months after Le Pen was defeated, before trading about half a percent lower at $1.093.

AT HOME

Benchmark indices ended with gains in vicinity of a fourth of a percent while broader market outperformed. Sensex added 67 points to settle at 29926 while Nifty finished at 9314, up 29 points. BSE mid-cap and small-cap indices climbed 0.5% and 0.7% respectively. BSE Realty index soared 4.5%, becoming top gainer among the sectoral indices, followed by 2% rise in Telecom index. FMCG and Capital Goods indices were the top losers, down 0.6% and 0.3% respectively.

FIIs net sold stocks and index futures worth Rs 542 cr and 238 cr respectively but net bought stock future worth Rs 682 cr. DIIs were net buyers to the tune of Rs 663 cr.

Rupee appreciated 6 paise to end at 64.4775/$.

SBI announced a 25 bps cut for home loans, bringing the rate down to 8.35% per annum for sub Rs 30 lakh loan. 

OUTLOOK

Today morning Asian markets are trading mixed with modest changes and SGX Nifty is suggesting about 10 points higher start for our market.

Yesterday was the seventh consecutive day of consolidation. During these seven days, Nifty has traded in a 100 point range of 9370-9270. Obviously, a crossover of this range, on either side, is required for taking a fresh directional view.

Below 9270, 34-DMA, placed around 9200, would be the next support to eye. Above 9370, 9470 would be the next upside target.

Meanwhile existing longs can be held on to with the stop-loss of 9270.

Bharti Airtel will report its quarterly earnings today.

NIFTY EXTENDS CONSOLIDATION BETWEEN 9367-9250 RANGE

NIFTY EXTENDS CONSOLIDATION BETWEEN 9367-9250 RANGE

WORLD MARKETS                             

US indices gained 0.3%-0.4% on Friday with S & P 500 and Nasdaq closing at record levels after solid jobs report. Apple too closed at record high.

The U.S. economy added 211,000 jobs in April and the unemployment rate fell to 4.4% as against expectation of 185,000 and 4.5% respectively. Average hourly wages rose 0.3%.

The benchmark 10-year note yield fell to 2.353% after a brief rise following the data release. The two-year note yield, meanwhile, rose to 1.32%.

Oil rebounded with WTI and Brent closing 1.5% higher at $46.22 and $49.10 per barrel respectively.

European markets added 0.6%-1.5%. Basic resources stocks were the best performers after copper prices recovered from a five-month low.

For the week, US indices gained 0.3%-0.9%. European markets climbed 1.3%-3.1% with CAC on the top. Asia however was more down that up with 1.3% higher Nikkei but 1.6% down Shanghai and 0.6% lower Hang Seng.

AT HOME

Benchmark indices nosedived just under a percent, registering the largest single day fall since 22nd March. Sensex tumbled 267 points to settle at 29859 while Nifty finished at 9285, down 75 points. BSE mid-cap and small-cap indices lost 1.1% and 0.8% respectively. Except a flat Consumer Durable index, all the BSE sectoral indices ended in red with Metal and Energy indices leading the losers, down 2.5% and 1.7% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 364 cr, 1088 cr and 470 cr respectively. DIIs were net buyers to the tune of Rs 298 cr.

Rupee depreciated 17 paise to end at 64.54/$.

For the week, Sensex and Nifty lost 0.2% each.

Government notified the ordinance to amend the Banking Regulation Act, empowering the Reserve Bank of India (RBI) and banks to initiate bankruptcy proceedings against chronic defaulters.

OUTLOOK

In the second and last round of the French presidential election, Macron defeated far-right candidate Marine Le Pen by securing 65.1% vote.

Nikkei is up a percent and half, other Asian markets are trading with gains of upto half a percent but Shanghai is down 0.4%. SGX Nifty is suggesting about 15 points higher start for our market.

Nifty has been in a consolidation mode over past six sessions and as we have been saying, 9367, the top made towards end of April, is the immediate hurdle, a decisive crossover of which is required for a fresh upmove. Also 9250-9225, where a gap on the daily chart as well as 20 DMA is placed, continue to be immediate support to eye.