NIFTY REBOUNDS FROM 20-DMA SUPPORT; 12000 CONTINUES TO BE IMMEDIATE HURDLE

NIFTY REBOUNDS FROM 20-DMA SUPPORT; 12000 CONTINUES TO BE IMMEDIATE HURDLE

WORLD MARKETS

US indices rose 0.4%-0.6% on the back of strong gains in Disney and energy share.

Disney rose 4.4% after Morgan Stanley raised his price target on the stock to $160 per share from $135.

Energy shares gained as US crude rose $1.14 or 2.2% to $52.22 a barrel and Brent gained $1.34 or 2.2% to $61.31 a barrel following attacks on two tanker ships off the coast of Iran that renewed fears of conflict in the Middle East after a series of strikes last month.

In Europe, FTSE and CAC were flat while DAX rose 0.4%. Germany raised 6.55 billion euros ($7.4 billion) in its auction of spectrum for 5G mobile services.

AT HOME

After falling about three fourth of a percent in the morning, benchmark indices recouped all the losses in noon trade to end little changed. Sensex settled at 39741, down 15 points while Nifty added 7 points to finish at 11914. BSE mid-cap and small-cap indices however ended with cuts of 0.3% and 0.5% respectively. BSE Realty and Power indices gained 0.6% each, becoming top gainers among the sectoral indices while IT and Teck indices were the top losers, down 0.8% and 0.6% respectively.

FIIs net bought stocks worth Rs 172 cr but net sold index futures and stock futures worth Rs 278 cr and 98 cr respectively. DIIs were net sellers to the tune of Rs 445 cr.

Rupee depreciated 17 paise to end at 69.51/$.

Indiabulls Housing soared after Abhay Yadav, who had filed a petition against promoter Sameer Gehlaut and the company over alleged fund misappropriation, withdrew his case in the Supreme Court.

Yes Bank nosedived after global brokerage house UBS slashed price target sharply by 47%, citing weak earnings going ahead.

OUTLOOK

Today morning, Nikkei and Shanghai are marginally higher while Hang Seng is off 0.4%. SGX Nifty is suggesting about 25 points lower start for our market.

In yesterday's report we had said that 11866, the low made on Wednesday, was the immediate support, below which, 11770, the bottom made last week, would be the important support.

Nifty broke 11866 support and went all the way to 11817, which roughly coincided with 20-DMA, from where it rebounded to end at 11914.

11819, the low made yesterday, is the immediate support to eye below which 11770, the low made last week, would be important support.

12000, the top made on Tuesday, continues to be immediate hurdle, upon crossover of which 12103, the top made last week, would be the next target.

11866-12000 IS THE IMMEDIATE RANGE

11866-12000 IS THE IMMEDIATE RANGE

WORLD MARKETS

US indices fell 0.2%-0.4%, pressured by declines in tech and bank shares.

US President Trump said on Tuesday that he was holding up a trade deal with China and had no interest in moving ahead unless Beijing agreed on as many as five “major points.” China too vowed a tough response if Washington insists on escalating trade tensions.

U.S. consumer prices rose just 0.1% last month, matching estimate. Core inflation, which strips out volatile components like food and energy prices, also rose 0.1%.

The benchmark 10-year yield fell to 2.12%.

US oil plunged $2.13 or 4% to $51.15 and Brent fell $2.32 or 3.7% to $59.97, after data from EIA showed U.S. commercial crude inventories rose by 2.2 million barrels in the week through June 7, much higher than the expected 4,81,000 figure.

European markets eased 0.3%-0.7%.

Earlier, Hong Kong’s Hang Seng index fell 1.73%, amid violent clashes between protesters and riot police over a controversial extradition bill.

AT HOME

After falling about eight tenth of a percent, benchmark indices recouped some of the lost ground in last half an hour to end lower by half a percent, breaking 3-day winning streak. Sensex lost 193 points to settle at 39756 while Nifty finished at 11906, down 59 points. BSE mid-cap and small-cap indices fell 0.8% and 0.5% respectively. Except 0.5% and 0.01% higher Metal and FMCG indices, all the BSE sectoral indices ended in red with Realty and Telecom indices leading the losses, down 1.9% and 1.6% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 1050 cr, 173 cr and 183 cr respectively. DIIs were net buyers to the tune of Rs 271 cr.

Rupee appreciated 10 paise to end at 69.34/$.

CPI rose to a 7-month high of 3.05% in May, up from 2.99% in April. The core CPI inflation eased to 4.23% compared with 4.55%. IIP growth rose to a six-month high of 3.4% in April, up from 0.4% in March.

OUTLOOK

Today morning, Asian markets are trading with cuts of 0.25-0.6% and SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that 11871, the low made on Monday, was the immediate support. Nifty, after touching a low of 11866, rebounded to end at 11906 and is likely to open flat today.

11866, the low made yesterday, which was very close to our indicated 11871 level, is the immediate support to eye. If that breaks, 11770, the bottom made last week, would be the important support.

12000, the top made on Tuesday, continues to be immediate hurdle, upon crossover of which, 12103, the top made last week, would be the next target.

NIFTY AGAIN RETREATS FROM THE VICINITY OF 11990 HURDLE; 11870 IS THE IMMEDIATE SUPPORT

NIFTY AGAIN RETREATS FROM THE VICINITY OF 11990 HURDLE; 11870 IS THE IMMEDIATE SUPPORT

WORLD MARKETS

US indices ended marginally in the red, with the Dow breaking six-day winning streak.

Economic data showed manufacturing activity in the U.S. grew at its slowest pace since 2016.

US and Brent crude ended flat at $53.27 and $62.29 a barrel respectively.

Earlier, Shanghai Composite surged 2.6% after Chinese state news agency Xinhua said the country would let local governments use bonds to finance infrastructure projects.

European markets gained 0.3%-0.9%. Data out of the U.K. showed wages in the three months to April beating forecasts while employment growth slowed, though the jobless rate held at its lowest rate since 1975.

AT HOME

Benchmark indices gained four tenth of a percent, extending the winning streak to third straight day. Sensex added 165 points to settle at 39950 while Nifty finished at 11965, up 42 points. BSE mid-cap and small-cap indices rose 0.8% and 0.2% respectively. Except marginally lower FMCG and Capital Goods indices, all the BSE sectoral indices ended in green with Metal index leading the tally, up 1.3%, followed by 0.9% higher Oil & Gas and Bankex indices.

FIIs net bought stocks, index futures and stock futures worth Rs 96 cr, 950 cr and 563 cr respectively. DIIs were net sellers to the tune of Rs 151 cr.

Rupee appreciated 21 paise to ned at 69.44/$.

Indiabulls Housing nosedived 8.1% after a legal action filed against the company for alleged misappropriation of Rs 98,000 crore of public money.

OUTLOOK

Today morning, Hang Seng and Shanghai are down 1.3% and 0.4% respectively while Nikkei is flat. SGX Nifty is suggesting a marginally lower start for our market.

Nifty, after taking support around our indicated 11775 support on Friday, has been in a recovery mode. In Monday's report we had said that "11990, the two third retracement level of the recent 12103-11770 fall, is the immediate hurdle to eye".

Yesterday, Nifty touched a high of 12000 but did not sustain there and slipped to end at 11965 and is set to open around 11950 today.

12000, the top made yesterday, is the immediate hurdle to eye, upon crossover of which, 12103, the top made last week, would be the next target.

11871, the low made on Monday, is the immediate support below which 11770, the bottom made last week, would be next support to eye.

India's May CPI data will be released today and is expected to show that retail inflation inched up to 3.1% from 2.92% in April, largely on the back of rising food prices. IIP for April is expected to show a print of around 0.32% as against figure of -0.1% in March.

NIFTY RETREATS FROM THE VICINITY OF 11990 HURDLE; 11770 CONTINUES TO BE NEAREST SUPPORT

NIFTY RETREATS FROM THE VICINITY OF 11990 HURDLE; 11770 CONTINUES TO BE NEAREST SUPPORT

WORLD MARKETS

US indices gained 03%-1% after U.S. reached an agreement with Mexico on tariffs. Dow extended the winning streak to sixth straight day.

Meanwhile, US president Turmp said more tariffs on Chinese goods will kick into place should Chinese President Xi Jinping fail to attend the upcoming G-20 meeting. The president previously threatened to put levies on another $300 billion in Chinese goods if a trade agreement is not reached soon.

US crude fell 73 cents or 1.4% to $53.26 a barrel while Brent eased $1 or 1.6% to $62.29 as major producers Saudi Arabia and Russia had yet to agree on extending an output-cutting deal and U.S.-China trade tensions continued.

European markets gained 0.3%-0.8%.  Britain’s economy sharply contracted in April after the biggest fall in car production since records began, as manufacturers were unable to reverse closures planned for the country’s departure from the European Union.

Earlier, Hong Kong’s Hang Seng index surged 2.03%, after official Chinese trade data for May beat forecasts and showed an overall trade surplus of $41.65 billion for the month.

AT HOME

Benchmark indices ended higher by four tenth of a percent after a choppy session, extending the winning streak to second straight day. Sensex added 168 points to settle at 39784 while Nifty finished at 11922, up 52 points. Broader market however underperformed as BSE mid-cap index gained just 0.1% while small-cap index tumbled 0.5%. BSE IT and Teck indices climbed 1.8% and 1.6% respectively, becoming top gainers among the sectoral indices while Oil & Gas index tumbled 1.2%, becoming top loser, followed by 0.4% lower Energy index.

FIIs net bought stocks and stock futures worth Rs 216 cr and 231 cr respectively but net bought index futures worth Rs 76 cr. DIIs were net buyers to the tune of Rs 171 cr.

Rupee depreciated 18 paise to end at 69.65/$.

OUTLOOK

Today morning, Asian markets are trading with gains of 0.1%-0.4% and SGX Nifty is suggesting about 20 points higher start for our market.

After Nifty took support around our indicated 11775 support on Friday, in yesterday's report we had said that "11990, the two third retracement level of the recent 12103-11770 fall, is the immediate hurdle to eye".

Yesterday, Nifty, after touching a high of 11975 in the initial trade, slipped to end at 11922, and is set to open modestly higher today.

11990 continues to be immediate hurdle, upon crossover of which, 12103, the top made last week, would be the next target.

11770, the low made Friday, continues to be immediate support.

NIFTY REBOUNDS AFTER ACHIEVING 11775 TARGET; 11990 IS THE IMMEDIATE HURDLE

NIFTY REBOUNDS AFTER ACHIEVING 11775 TARGET; 11990 IS THE IMMEDIATE HURDLE

WORLD MARKETS

US indices soared 1%-1.7% as disappointing nonfarm payroll figures boosted speculation of an interest rate cut from the Federal Reserve.

The U.S. economy added 75,000 jobs in May, as against expected figure of 1,80,000 and also marking the second time in four months that jobs growth totaled less than 100,000. Wage growth also slowed.

Treasury yields fell broadly, with the benchmark 10-year rate dropping to 2.05%, its lowest level since 2017, before recovering to 2.09. Dollar index fell 0.4% to 96.56, its lowest level in 2-1/2 months.

Officials from the U.S. and Mexico continued talks on Friday. President Trump tweeted “there is a good chance” that US and Mexico can make a deal. Meanwhile, at the St Petersburg International Economic Forum, Russian President Vladimir Putin criticized Washington’s treatment of Chinese telecommunications giant Huawei.

US oil and Brent rose 2.7% each to $53.99 and $63.33 a barrel respectively after Saudi Arabia said OPEC was close to agreeing to extend an output production cut beyond June

European markets gained 0.8%-1.6%.

For the week, Dow jumped 4.7%, breaking six-week losing streak and also marking its biggest weekly gain since November. The S&P 500 and Nasdaq were up 4.4% and 3.9% respectively. European markets rose 2.4%-3%. In Asia, while Nikkei and Hang Seng rose 1.4% and 0.2% respectively, Shanghai tumbled 2.4%.

AT HOME

After falling about six tenth of a percent in the initial trade, benchmark rebounded smartly through the session to end higher by nearly a fifth of a percent. Sensex added 86 points to settle at 39615 while Nifty finished at 11870, up 26 points. BSE mid-cap and small-cap indices fell 0.2% and 0.1% respectively. BSE Finance index gained 0.7%, becoming top gainer among the sectoral indices, followed by 0.6% higher Consumer Durable index and Bankex. Utilities and Power indices were the top losers, down 1.3% and 0.8% respectively.

FIIs net sold stocks and index futures worth Rs 479 cr and 287 cr respectively but net bought stock futures worth Rs 307 cr. DIIs were net buyers to the tune of Rs 180 cr.

Rupee depreciated 20 paise to end at 69.47/$.

For the week, Sensex and Nifty lost 0.2% and 0.4% respectively, breaking 3-week winning streak.

OUTLOOK

Trump, on Friday, announced that the US and Mexico have reached a deal to avoid the implementation of tariffs, originally set to kick in today.

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

Readers would recall that after Nifty broke 11940 support, we had given downside target zone of 11800-11775.

Nifty, on Friday, after touching a low of 11770, rebounded to close at 11870, achieving 11775 target mentioned above and vindicating our view.

The benchmark is slated to open above 11900 today.

11990, the two third retracement level of the recent 12103-11770 fall, is the immediate hurdle to eye above which 12103 itself would be next resistance.

11770, the bottom made on Friday, is the immediate support to eye below which 34-DMA, placed around 11660, would be next support.

11800-11775 IS THE SUPPORT ZONE; 11975 IMMEDIATE HURDLE

11800-11775 IS THE SUPPORT ZONE; 11975 IMMEDIATE HURDLE

WORLD MARKETS

US indices rose 0.5%-0.7%, extending the winning streak on third straight day, on news that the U.S. is considering a postponement to Trump’s 5% tariff on all Mexican imports after the country’s negotiators asked for more time to hash out a deal. The tariff is set to kick in on Monday.

Meanwhile, Trump told reporters at the Irish airport of Shannon that tariffs on China could be raised by another $300 billion if necessary.

US crude rose 91 cents to $52.51 a barrel while Brent rose $1.04 to $61.67.

In Europe, FTSE rose 0.6% while DAX and CAC fell a fourth of a percent each. European Central Bank President Mario Draghi said it would delay its first post-crisis interest rate hike till at least the middle of next year. In a statement, the ECB said it would hold its key policy rate at the current -0.4% and continue to reinvest in maturing bonds in its 2.6 trillion euro ($2.9 trillion) debt portfolio. The central bank also announced it will pay lenders an interest rate of up to 0.3% to borrow. Meanwhile, GDP growth for the euro area was confirmed at 0.4% quarter-on-quarter and 1.2% year-on-year.

AT HOME

Sensex and Nifty nosedived 1.4% and 1.5% respectively, suffering the steepest cut of the calendar 2019. Sensex settled at 39529, down 553 points while Nifty lost 178 points to finish at 11843. BSE mid-cap and small-cap indices tumbled 1.8% and 1.6% respectively. All the BSE sectoral indices ended in red with Oil & Gas and Capital Goods indices leading the losses, down 3% and 2.8% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 1449 cr, 1473 cr and 211 cr respectively. DIIs were net sellers to the tune of Rs 651 cr.

Rupee depreciated 1 paise to end at 69.26/$.

Monetary Policy Committee unanimously cut the repo rate by 25 bps and changed the stance to "Accommodative" from "Neutral". It lowered the FY20 GDP growth forecast to 7% from 7.2% earlier. On the inflation front, while it raised H1FY20 CPI forecast to 3-3.1% from 2.9-3%, H2 forecast was cut to 3.4-3.7% from 3.5-3.8%.

OUTLOOK

Markets in China and Hong Kong are closed on Friday for a holiday. Nikkei is up 0.3% and SGX Nifty is suggesting about 20 points lower start for our market.

Readers would recall that after Nifty touched a record high of 12103 on Monday, we had advised trailing the stop-loss in long positions to 11940. Nifty yesterday broke this support and plunged all the way to 11830 before closing at 11843 and is set to open modestly lower today.

11800-11775, which are the 61.8% and 67% retracement levels respectively of the recent 11614-12103 upmove, represent the next support zone for Nifty. Below 11775, 34-DMA, placed around 11660, would be the crucial support to eye.

11975 is the immediate resistance hourly chart, with the stop-loss of which, trading shorts can be held on to.

ALL EYES ON MONETARY POLICY

ALL EYES ON MONETARY POLICY

WORLD MARKETS

Dow and S & P 500 gained 0.8% each while Nasdaq rose 0.6%, extending Tuesday's upmove. On Tuesday, Dow and S & P 500 had surged 2% each while Nasdaq climbed 2.6% after Federal Reserve Chairman Jerome Powell signaled the central bank was open to the possibility of slashing interest rates in the face of international trade disputes.

Powell said the central bank will keep an eye on current developments in the economy, and would do what it must to “sustain the expansion.”

Data from ADP and Moody’s Analytics showed private payrolls increased by just 27,000 in May, its lowest since March 2010 and as against expected figure of 173000.

White House trade advisor Peter Navarro said that U.S. levies on Mexican goods “may not have to go into effect,” depending on how talks between the two countries go. Meanwhile, several Republican lawmakers have noted their opposition to new tariffs on Mexican imports while some have hinted at the possibility of blocking such levies.

WTI crude plunged 3.4% to $51.68 and Brent tumbled 2.1% to $60.66 a barrel after data from EIA showed U.S. commercial crude inventories jumped by 6.8 million barrels in the week through May 31.

European markets, except 0.4% lower Italy, gained 0.1%-0.4%. Italy fell after the European Commission threatened disciplinary measures on the country over its rising public debt. Composite and services PMI figures for the euro area showed the U.K. economy was close to stagnation due to uncertainty over Brexit, while Germany’s services sector provided growth momentum for its cooling economy. French business activity strengthened in May.

AT HOME

Benchmark indices fell about half a percent on Tuesday, extending "one-day-up, one-day-down" phenomenon. Sensex lost 184 points to settle at 40083 while Nifty finished at 12021, down 66 points. BSE mid-cap and small-cap indices fell 0.2% each. BSE IT and Teck indices tumbled 1.6% and 1.5% respectively, becoming top losers among the sectoral indices while Capital Goods and Utilities indices were the top gainers, up 0.4% each.

FIIs net sold stocks, index futures and stock futures worth Rs 416 cr, 1153 cr and 749 cr respectively. DIIs were net sellers to the tune of Rs 355 cr.

Rupee ended unchanged at 69.25/$.

OUTLOOK

Today morning, Nikkei is up 0.1% while Hang Seng and Shanghai are down 0.1% and 0.5% respectively. SGX Nifty is trading around 12050, suggesting a marginally lower start when compared to Tuesday's close of Nifty futures.

After Nifty broke above the 12041 resistance on Monday, we had given next upside target of 12250 and had advised trailing the stop-loss to 11940 in Tuesday's report.

Nifty, on Tuesday, slipped 66 points to settle at 12021 and is set to open little changed today.

11940 continues to be immediate support on the hourly chart, with the stop-loss of which, existing longs should be held on to. 12250 continues to be upside target to eye.

Key event to watch out today would be decision of RBI's Monetary Policy Committee. While there is near consensus on a 25 bps rate cut, some are even expecting 35 or even 50 bps cut in light of benign inflation and weakening growth. Market will also watch out whether the stance of the policy is changed to "Accommodative" from "Neutral".