10138 CONTINUES TO BE IMMEDIATE HURDLE; 20-DMA SUPPORT AT 9960

10138 CONTINUES TO BE IMMEDIATE HURDLE; 20-DMA SUPPORT AT 9960

WORLD MARKETS                             

Dow and S & P 500 rose 0.1% and 0.2% respectively while Nasdaq climbed half a percent. Dow Jones industrial average recorded its 9th straight record close. S & P 500 registered its first record close since July 26.

St. Louis Federal Reserve President James Bullard said the central bank won't need to raise rates in the near term. Minneapolis Fed President said in a separate speech that immigration cuts proposed by the Trump administration will cut economic growth.

European markets, except a 0.3% lower DAX, gained upto 0.4%. Basic resources stocks gained amid an uptick in Chinese iron ore prices. The Sentix investor confidence index for euro zone dropped to 27.7 in August, down from 28.3 in July.

AT HOME

Benchmark indices ended marginally lower after trading in a narrow range. Sensex lost 52 points to settle at 32274 while Nifty finished at 10057, down 9 points. BSE mid-cap and small-cap indices however outperformed significantly, rising 1.1% each. BSE Oil & Gas and Realty indices climbed 1.6% and 1.4% respectively, becoming top gainers among sectoral indices while IT and Teck indices were the top losers, down 0.9% and 0.8% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 199 cr, 773 cr and 376 cr respectively. DIIs were net buyers to the tune of Rs 308 cr.

Rupee depreciated 22 paise to end at 63.80/$.

Sebi has directed stock exchanges to initiate action against 331 suspected shell companies. The list includes names like Assam Company, Pincon Spirit, REI Agro, Prakash Ind, SQS BFSI, Rohit Ferro etc.

Tata Steel reported more than four-fold jump in June quarter net profit at Rs 933 cr, driven by strong operational performance of India as well as Europe businesses. Profit however also included forex gain of Rs 543 cr. Revenue rose 19.3% to Rs 30973 and operating profit jumped 52% to Rs 4973 cr.

OUTLOOK

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

In yesterday's report we had mentioned that 10138, the top made last week, is the immediate hurdle, a crossover of which is required for a fresh upmove.

Nifty, after touching a high of 10088 in the initial trade, slipped to end at 10057 and is set to open flat today.

10138 continues to be immediate hurdle, a crossover of which is required for a fresh upmove. 10300 would be the next target if that happens.

20-DMA has now moved up to 9960 and would be the immediate support to eye.

Jindal Steel will report its quarterly earnings today.

10138 CONTINUES TO BE IMMEDIATE HURDLE; 20-DMA LANDS SUPPORT AROUND 9950

10138 CONTINUES TO BE IMMEDIATE HURDLE; 20-DMA LANDS SUPPORT AROUND 9950

WORLD MARKETS                             

Dow ended little changed while S & P 500 and Nasdaq lost 0.2% and 0.4% respectively on Friday.

The U.S. economy added 209,000 jobs last month, according to the Labor Department, well above the expected gain of 183,000.

U.S. Treasury yields jumped on the data, with the benchmark 10-year yield climbing to 2.264%, while the short-term two-year yield rose to 1.355%. Dollar index gained 0.8% to 93.49.

European markets gained 0.5%-1.4%.

For the week, Dow and S & P 500 gained 1.2% and 0.2% respectively but Nasdaq fell 0.4%. European markets gained 1.1%-2%. In Asia, Hang Seng surged 2.2%, Shanghai added 0.3% but Nikkei ended marginally in the red.

On Saturday, the United Nations Security Council unanimously imposed new sanctions on North over its intercontinental ballistic missile tests in July. The sanctions could slash Korea's $3 billion annual export revenue by a third.

AT HOME

After a lackluster morning trade, Sensex and Nifty indices spiked up in the noon trade to end higher by 0.3% and 0.5% respectively. Sensex settled at 32325, up 88 points while Nifty climbed 53 points to finish at 10066. BSE mid-cap and small-cap indices added 0.7% and 0.1% respectively. Except 0.9% and 0.4% lower Healthcare and Telecom indices respectively, all the BSE sectoral indices closed in green with Consumer Durable index leading the tally, up 4.2%, followed by 2.6% higher Oil & Gas index.

FIIs net sold stocks and index futures worth Rs 854 cr and 286 cr respectively but net bought stock futures worth Rs 50 cr. DIIs were net buyers to the tune of Rs 1017 cr.

Rupee appreciated 11 paise to end at 63.58/$.

For the week, Sensex ended little changed while Nifty added half a percent.

M & M reported 20% y-o-y dip in net profit at Rs 768 cr. Revenue rose 5.4% to Rs 11094 cr. Operating profit fell 2.9% to Rs 1454 cr and margin contracted by 110 bps to 13.1%.

Finance Minister Arun Jaitley announced the formation of Bharat-22 ETF in order to speed up its divestment drive and meet the target for FY18. The ETF will comprise of Central Public Sector Enterprise (CPSE), public sector banks (PSBs) and will also have some strategic holding in the Specified Undertaking of the Unit trust of India (SUUTI).

GST Council on Saturday rationalised rates of 19 services including textile jobs and government work contracts, cut taxes on certain tractor parts to 18% from 28%, and approved e-way bill rules that will remove checkposts at state borders.

OUTLOOK

Today morning, except a 0.3% lower Shanghai, other Asian markets are trading with gains of 0.2%-0.6% and SGX Nifty is suggesting a marginally higher start for our market.

On Friday, we had said that upon breach of 9998, next downside target to eye would be about 9930, where 20-DMA was placed.

Nifty, after touching a low of 9988 in the morning session, rebounded sharply in the noon trade to end at 10066 and is set to open marginally higher today.

10138, the top made last week, continues to be immediate hurdle above which 10300 would be the next upside target.

20-DMA has now moved up to 9950 and would be the immediate support to eye.

Tata Steel and Britannia will report their quarterly earnings today.

EXIT TRADING LONGS BELOW 9998

EXIT TRADING LONGS BELOW 9998

WORLD MARKETS                             

US Dow ended marginally in the green while S & P 500 and Nasdaq fell 0.2% and 0.4% respectively

Media reports suggested that Robert Mueller, the special counsel overseeing the investigation into possible Trump campaign collusion with Russia, has impaneled a grand jury in Washington, which indicates the probe is intensifying.

U.S. jobless claims totaled 240,000 versus expectations of 242,000. IHS Markit Services PMI Index hit 54.7 in July, slightly higher than in June, but ISM nonmanufacturing index showed growth in the services sector slowed last month.

European markets, except a 0.2% lower DAX, gained 0.3%-1%. Sterling fell 0.6% against the dollar following news that the Bank of England had voted 6-2 against a change in rates.

AT HOME

Sensex and Nifty tumbled about seven tenth of a percent, extending the losing streak to second day. Sensex lost 239 points to settle at 32238 while Nifty finished at 10014, down 68 points. BSE mid-cap and small-cap indices lost 0.5% and 1% respectively. BSE Metal index and Bankex nosedived 1.7% each, becoming top losers among the sectoral indices while Oil & Gas index was the top gainer, up 1.4%, followed by 1.1% higher Energy and Telecom indices.

FIIs net bought stocks and stock futures worth Rs 24 cr and 191 cr respectively but net sold index futures worth Rs 369 cr. DIIs were net sellers to the tune of Rs 389 cr.

Rupee appreciated 1 paise to end at 63.69/$.

IOC reported better-than-expected June quarter results on all parameters. Net profit fell 45% y-o-y to Rs. 4548 cr. Gross Refining Margin fell to $4.32/barrel from $9.98/barrel. Revenue rose to 1.29 lac crore, up from 1.08 lac crore.

India's Nikkei Service PMI for July plunged to 45.9, the lowest since September 2013, from June's eight month high of 53.1. Composite PMI slipped to 46 from 52.7.

Cognizant reported 8.9% growth in revenue at USD 3.67 bn, meeting it forcast of 3.63-3.68 bn. The company revised its revenue growth outlook for the full year to 9-10% (USD 14.70-14.84 billion) compared to a previous forecast of 8-10% growth.

OUTLOOK

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

In yesterday's report we had reiterated the view that 10000 is the immediate support, a breach of which will generate a sell on the hourly chart and would pave the way for further correction.

Nifty yesterday touched a low of 9998 before closing at 10014, holding the 10000 support by the skin of it's teeth.

A breach of 9998, the low made yesterday, would confirm a sell on the hourly chart and would pave the way for further correction. 20-DMA, placed around 9930, would be the next immediate target if that happens, below which 34-DMA, placed around 9800, would be the next important support to eye.

Traders are advised to exit long positions if 9998 is breached.

HPCL, M & M and Dabur will report their quarterly earnings today.

Key data to watch out today would be the US non-farm payroll figure, which is expected to show an addition of 185000 jobs in July.

STAY LONG WITH THE STOP-LOSS OF 10000

STAY LONG WITH THE STOP-LOSS OF 10000

WORLD MARKETS                             

Dow and S & P 500 gained 0.2% and 0.1% respectively while Nasdaq ended flat with the Dow closing above the 22000 mark for the first time.

Apple surged nearly 5% after reporting strong quarterly earnings.

Data from ADP showed private U.S. companies added 178,000 jobs last month, just below expectations of 185,000. Job growth for June was revised from 158,000 to 191,000.

Treasury yields traded mixed with the benchmark 10-year yield near 2.266% and the two-year yield around 1.359%.

Dollar touched a two-and-a-half year low of $1.19 against the Euro.

WTI and Brent crude rose nearly a percent to $49.59 and $52.36 a barrel.

European markets lost 0.2%-0.7%.

AT HOME

After a positive start, benchmark indices saw a sustained downward move through the session to end with cuts of three tenth of a percent. Sensex lost 98 points to settle at 32477 while Nifty finished at 10082, down 33 points. BSE mid-cap and small-cap indices fell 0.3% and 0.1% respectively. BSE IT index was the top loser among the sectoral indices, down 0.9%, followed by 0.8% cut in FMCG, Capital Goods and Teck indices.

FIIs net bought stocks worth Rs 474 cr but net sold index futures and stock futures worth Rs 1060 cr and 42 cr respectively. DIIs were net sellers to the tune of Rs 233 cr.

Rupee appreciated 37 paise to end at 63.70/$.

Lupin reported earnings which were mostly below street estimates. Net profit fell 59.4% to Rs 358 cr and revenue dipped 13.4% to Rs 3869 cr. Operating profit declined 41.3% to Rs 768 cr and margins tumbled 961 bps to 19.9%.

PNB posted 12% rise in net profit at Rs 343 cr along with 4% rise in NII at Rs 3855 cr. Asset quality deteriorated with Gross NPA ratio rising to 13.66% from 12.53% q-o-q and net NPA ratio rising to 8.67% from 7.81%. Provisions stood at Rs 2609 cr, a decline from Rs 5753 cr sequentially.

OUTLOOK

Today morning, Asian markets are trading with modest cuts and SGX Nifty is suggesting about 30 points lower start for our market.

In yesterday's report we had said that having crossed 10115 hurdle, next target to eye for Nifty is around 10300 and had advised holding on to long positions with the revised stop-loss of 10000.

The benchmark, after touching a high of 10138 in the initial trade, slipped to end at 10081 and is set to open around 10050 today.

10000 continues to be immediate support, with the stop-loss of which, existing longs should be held on to. 10138, the top made yesterday, is the immediate hurdle, above which 10300 would be the next target to eye.

IOC, Titan and Colgate will report their quarterly earnings today.

STAY LONG WITH THE STOP-LOSS OF 10000 FOR NEXT TARGET OF 10300

STAY LONG WITH THE STOP-LOSS OF 10000 FOR NEXT TARGET OF 10300

WORLD MARKETS                             

US indices gained 0.2%-0.3% with the Dow closing at the fresh record high.

Core personal consumption expenditure (PCE) price index for June – which is watched by the Federal Reserve as an estimate of inflation — rose 1.5% y-o-y and 0.1% on-month, reflecting tepid inflation. Consumer spending rose just 0.1% in June and personal income for June remained unchanged, below an expected increase of 0.3%. The ISM manufacturing index stood at 56.3. The IHS Markit manufacturing PMI hit its highest level in four months in July, while construction spending declined 1.3% in June.

U.S. Treasury yields traded lower with the 10-year yield at 2.257% and the two-year yield near 1.347%. Dollar index, after hitting a 15-month low of 92.77 on Monday, rebounded to 93.049.

Oil fell more than 2% due to concerns over the increase in supply from global oil producers as output from OPEC producers increased in July despite the bloc's output cut agreement.

European markets added 0.6%-1.1%. A preliminary reading on Eurozone GDP showed a growth of 0.6% q-o-q and 2.1% y-o-y in the second quarter. Eurozone IHS Markit's final manufacturing PMI came in at 56.6 in July, just off June's six-year high of 57.4.

AT HOME

After trading in a narrow range for better part of the day, Sensex and Nifty spiked up in last half an hour to end at fresh record high with gains of 0.2% and 0.4% respectively. Sensex added 60 points to settle at 32575 and Nifty finished at 10115, up 38 points. BSE mid-cap index rose 0.4% but the small-cap index fell 0.1%. BSE Auto and Metal indices climbed 1.6% and 1% respectively, becoming top gainers among the sectoral indices while Consumer Durable was the top losers, down 0.8%, followed by 0.4% lower Telecom and Capital Goods indices.

FIIs net sold stocks, index futures and stock futures worth Rs 946 cr, 421 cr and 102 cr respectively. DIIs were net buyers to the tune of Rs 1391 cr.

Rupee appreciated 12 paise to end at fresh 11-week high of 64.08/$.

Maruti reported 20.6% jump in July sales at 1.65 lac units. That of Ashok Leyland rose 14% to 11981 units. Eicher Motors reported 21% rise in Royal Enfield sales at 64459 units. Escort's tractor sales rose 34.3% to 5418 units. Tata Motors sold 46216 units, a growth of 7%. M & M auto sales were up 6% at 41747 units while tractor sales rose 7% to 18832 units.

TVS Motor sales were up 9.34% at 2.71 lakh units while Hero MotoCorp sales surged 17% at 6.23 lakh units.

OUTLOOK

Today morning, Asian markets are trading with gains of upto 0.6% and SGX Nifty is suggesting a flattish start for our market.

For past couple of days, we had been mentioning that 10115, the top made last week, is the immediate hurdle, a crossoer of which is required for a fresh upmove.

Nifty yesterday touched a high of 10129 before closing exactly at 10115.

Next upside target continues to be around 10300. Immediate support on the hourly chart has moved up to 10000, below which 9944, the low made last week, would be next important support to eye.

Traders are advised to hold long positions with the stop-loss of 10000.

RBI, at the end of its two day monetary policy meeting, is widely expected to cut repo rate by 25 bps on the back of softer inflation and good progress of monsoon couple with less than encouraging industrial production and core sector growth data recently. As always, tone of the policy statement would be important to guage further possibility of interest rate cuts.

Lupin and PNB will report their quarterly earnings today.

10115-9928 CONTINUES TO BE IMMEDIATE RANGE

10115-9928 CONTINUES TO BE IMMEDIATE RANGE

WORLD MARKETS                             

Dow gained 0.3% while S & P 500 and Nasdaq fell 0.1% and 0.4% respectively. Dow was aided by Goldman Sachs, Boeing and Home Depot while materials and information technology lagged, pressuring S & P 500 and Nasdaq.

The White House saw a major shake-up after John Kelly replaced Reince Priebus as President Trump's chief of staff.

Pending home sales rose 1.5% in June. U.S. Treasury yields rose slightly, with the benchmark 10-year yield trading at 2.292% and the two-year yield around 1.351%.

WTI crude rose 46 cents or 1% to $50.17 on possibility of U.S. sanctions against Venezuela's oil sector after a controversial election on Sunday.

The euro soared to a two-and-a-half year high against the dollar  after Eurozone core inflation edged up to 1.3%, a four-year high, from 1.2% in June, contrary to market expectations of a slight drop to 1.1%.

In Europe, Italy gained 0.3%, FTSE ended a tad higher but DAX and CAC fell 0.4% and 0.7% respectively. Germany said it was open to class action lawsuits against carmakers.

Earlier, data from China showed official PMI for July stood at 51.4, lower than the 51.6 forecast.

AT HOME

Benchmark indices gained about six tenth of a percent to make a fresh record high on closing basis. Sensex added 205 points to settle at 32515 while Nifty finished at 10077, up 63 points. BSE mid-cap and small-cap indices gained 0.4% and 0.1% respectively. BSE Consumer Durable and Metal indices climbed 1.9% and 1.7% respectively, becoming top gainers among the sectoral indices while Healthcare and FMCG indices were the top losers, down 1.5% and 1% respectively.

FIIs net sold stocks and index futures worth Rs 1197 cr and 426 cr respectively but net bought stock futures worth Rs 202 cr. DIIs were net buyers to the tune of Rs 1768 cr.

Rupee depreciated 4 paise to end at 64.19/$.

India's core sector growth slowed to 0.4% in June due to contraction in output of coal, refinery products, fertiliser and cement.

Tech Mahindra earnings beat expectations on all parameters. Dollar revenue rose 0.6% to USD 1138 mn. Net profit surged 36% to Rs 799 cr and revenue fell 2.1% to Rs 7336 cr. EBIT rose 11.8% to Rs 688 cr and margin expanded by 120 bps to 9.4%.

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 9928, the erstwhile resistance, would now act as the important immediate support and 10115, the top made last week, is the immediate hurdle.

Nifty rose 63 points yesterday to end at 10077, holding on to this range.

9928-10115 continues to be relevant range, a crossover of which, on either side, is required for a fresh directional view. Above 10115, next target would be about 10300.

JSW Steel and Marico will report their quarterly earnings today.

RBI begins it’s two-day policy meeting today.

10115-9928 IS THE IMMEDIATE RANGE

10115-9928 IS THE IMMEDIATE RANGE

WORLD MARKETS                             

Dow gained 0.2% while S & P 500 and Nasdaq lost 0.1% each of Friday.

U.S. economy grew at an annualized rate of 2.6% in the quarter ended June. While the reading met expectations, the 1.9% growth recorded in the first half of the year suggested it was unlikely that full-year growth would exceed 2.5%. Consumer sentiment for July topped expectations at 93.4.

Dollar index slipped nearly two-third of a percent to 93.34 following GDP data.

Amazon.com shares fell as more than 4% on the back of much weaker-than-expected quarterly results.

European markets lost 0.4%-1%. Euro zone economic confidence surged to a 10-year high in July. Spanish gross domestic product (GDP) rose by 0.9% in the second quarter of the year. French GDP rose 0.5% while the U.K.'s GDP inched 0.3% higher over the same period.

For the week, S & P 500 and Nasdaq ended slightly lower while Dow rose 1%. In Europe, FTSE and DAX fell 1.1% and 0.6% respectively but CAC was up 0.3%. In Asia, Hang Seng and Shanghai added 1% and 0.5% respectively but Nikkei fell 0.7%.

North Korea test launched a projectile on Friday. In response, the U.S. flew two B-1B bombers over the peninsula and urged countries in the region to do more to tackle the issue.

AT HOME

After falling about three fourth of a percent, benchmark indices recouped most of the losses in the late noon trade to end just marginally lower. Sensex settled at 32310, down 73 points while Nifty lost 6 points to finish at 10014. BSE mid-cap and small-cap indices however gained 0.5%and 0.4% respectively. BSE Healthcare and Metal indices tumbled 1.7% and 1.4% respectively, becoming top losers among the sectoral indices while IT and Teck indices were the top gainers, up 1% and 0.8% respectively.

FIIs net sold stocks and index futures worth Rs 223 cr and 1744 cr but net bought stock futures worth Rs 150 cr. DIIs were net buyers to the tune of Rs 425 cr.

Rupee depreciated 4 paise to end at 64.15/$.

For the week, Sensex and Nifty gained 0.9% and 1% respectively, extending the winning streak to fourth straight week.

L & T reported better-than-expected revenue and net profit while margin was a miss. Net profit rose 24.4% to Rs 1066 cr. Revenue rose 9.7% to Rs 23990 cr. EBIDTA rose 9% to Rs 2057 cr and margin contracted 6 bps to 8.6%. The company won new orders worth Rs. 26,352 during the quarter. Consolidated order book, at the end of quarter, stood at Rs. 2,62,860 crore, marginally higher by 2% yoy. Company maintained full year guidance of revenue, margin and order inflow growth.

OUTLOOK

China's July manufacturing PMI has come in at 51.4, down from 51.7 in June.

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

In Friday's report we had mentioned that immediate support on the hourly chart of Nifty had moved to 9960, a sustained trading below which will confirm a "sell" on the hourly chart.

Nifty, while touched a low of 9945, didn't sustain there and rebounded to close at 10014.

9945 also roughly coincides with the previous hurdle of 9928 which makes 9945-9928 an important immediate support to eye. Below 9928, 9792, the bottom made in mid-July, would be the next important support to eye.

10115, the top made last week, is the important immediate hurdle, a crossover of which is required for a fresh upmove.

Tech Mahindra will report its quarterly earnings today.