Thursday, December 14, 2017

NIFTY HOLDS 10170 SUPPORT; 10330 IS THE IMMEDIATE HURDLE

NIFTY HOLDS 10170 SUPPORT; 10330 IS THE IMMEDIATE HURDLE

WORLD MARKETS                             

Dow and Nasdaq gained 0.3% and 0.2% respectively while S & P 500 ended marginally in the red after the Federal Reserve raised interest rates for the third time this year.

The Fed raised interest rates by a quarter point that increased the central bank's target range to between 1.25% and 1.5%. Also it raised its 2018 GDP forecast from 2.1% to 2.5%. Its inflation forecast was raised from 1.6% to 1.7%.  Interest-rate forecasts for 2018 and 2019 were kept unchanged.

Treasury yields and dollar fell following the Fed's announcement. The benchmark 10-year yield traded at 2.348%, while the two-year yield slipped to 1.782%.

The consumer price index rose 0.4% last month, as expected. Excluding food and energy, consumer prices rose 0.1%.

Meanwhile, House and Senate Republicans came to a tentative agreement on their tax plan.

European markets saw cuts of 0.1%-1.4% with Italy leading the losses.

AT HOME

After rising about half a percent in the morning, benchmark indices nosedived a percent from the top of the day in late noon trade to end lower by half a percent, extending the losing streak to second straight day. Sensex settled at 33053, down 175 points while Nifty lost 47 points to finish at 10193. BSE mid-cap and small-cap indices fell 0.8% each. Except 0.5% and 0.2% higher Oil & Gas and Energy indices respectively, all the BSE sectoral indices ended in red with Realty and Metal indices leading the tally, down 2.3% and 1.7% respectively.

FIIs net sold stocks worth Rs 579 cr but net bought index futures and stock futures worth Rs 767 cr and 131 cr respectively. DIIs were net sellers to the tune of Rs 116 cr.

Rupee depreciated 4 paise to end at 64.44/$.

OUTLOOK

Today morning, Nikkei is marginally in the red but Hang Seng and Shanghai are up 0.4% and 0.7% respectively. SGX Nifty is suggesting about 60 points higher start for our market.

In yesterday's report we had reiterated the view that 10170 continues to be immediate support a breach of which will generate a sell on the hourly chart and would pave the way for further correction.


Nifty touched a low of exactly 10170 and closed at 10193 and is set to open higher today.

Wednesday, December 13, 2017

10170 CONTINUES TO BE IMMEDIATE SUPPORT; 10330 HURDLE

10170 CONTINUES TO BE IMMEDIATE SUPPORT; 10330 HURDLE

WORLD MARKETS                             

Dow and S & P 500 gained 0.5% and 0.2% respectively while Nasdaq fell 0.2% amid growing optimism that Republican lawmakers would be able to revamp the corporate tax system.

Brent crude fell 2% to $63.34 and US crude lost 1.4% to $56.91 after the U.S. Energy Information Administration said it expects U.S. oil production to rise sharply next year

European markets, except a 0.2% lower Spain, gained 0.2%-0.8%. The U.K. inflation rate hit a five-year-high of 3.1%.

AT HOME

Sensex and Nifty fell 0.7% and 0.8% respectively to break three-day winning streak. Sensex lost 228 points to settle at 33228 while Nifty finished at 10240, down 82 points. BSE mid-cap and small-cap indices fell 1% and 0.7% respectively. All the BSE sectoral indices ended in red with Telecom and Realty indices leading the tally, down 2.1% and 1.6% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 843 cr, 266 cr and 382 cr respectively. DIIs were net sellers to the tune of Rs 854 cr.

Rupee depreciated 4 paise to end at 64.40/$.

India's retail inflation grew at 4.88%, the fastest pace in 15-months, in November. In October, the figure was 3.58%. Core inflation rose to 4.86% from 4.6%.

India's factory output growth slowed to 2.2% in October as compared with 3.8% a month ago.

OUTLOOK

Today morning, Asian markets are trading flat to modestly lower and SGX Nifty is suggesting about 20 points lower start for our market.

After Nifty crossed the 34-DMA hurdle of 10285, we were working with next target of 10360, where the downward sloping trendline adjoining tops made in November was placed.

Nifty, after touching a high of 10326 in the initial trade, slipped to end at 10240 and is set to open lower today.

10170 continues to be immediate support on the hourly chart, a breach of which will confirm a sell on the hourly chart and would pave the way for further correction.

On the upside, 10330, the top made on Monday, is now the immediate hurdle above which 10410, the top made in late November, would be the tougher resistance to eye.

Traders are advised to keep stop-loss of 10170 in long positions.


Federal Reserve, at the end of its two-day meeting today, is expected to raise interest rate by a quarter point. Also, in light of potential changes to the US tax system, the Fed may be forced to increase its economic and interest-rate outlooks.

Tuesday, December 12, 2017

NIFTY ACHIEVES 10285 TARGET; 10360 NEXT

NIFTY ACHIEVES 10285 TARGET; 10360 NEXT

WORLD MARKETS                             

US indices, led by energy and tech stocks, gained 0.2%-0.5%, shrugging off a terror incident ahead of Wednesday's US Fed decision.

Brent crude rose 2% to $64.69 and WTI settled 1% higher at $57.99 to reach their highest levels in more than two years on news that Britain's Forties Pipeline would be shut.

European markets, except a 0.8% higher FTSE, ended with cuts of 0.1%-0.4%.

AT HOME

Benchmark indices gained about six tenth of a percent in today's trade to extend winning streak to third straight day. Sensex gained 205 points to settle at 33456 while Nifty finished at 10322, up 57 points. BSE mid-cap and small-cap indices gained 0.4% and 0.2% respectively. BSE IT and Teck indices climbed 1% and 0.9% respectively to become top gainers among sectoral indices while Oil & Gas and Energy indices were the top losers, down 0.2% each.

FIIs net sold stocks worth Rs 186 cr but net bought index futures and stock futures worth Rs 110 cr and 54 cr respectively. DIIs were net buyers to the tune of Rs 109 cr.

Rupee appreciated 9 paise to end at 64.36/$.

OUTLOOK

Today, Asian markets are trading little changed and SGX Nifty is suggesting a flattish start for our market.

Readers would recall that after Nifty took out the immediate hurdle of 10160, we had given upside targets of 10285 followed by 10370. Nifty yesterday climbed 57 points to settle at 10322, achieving the first target and moving towards the second.

10360, where a trendline adjoining tops made in November is placed, continue to be next target as well as resistance to eye.

Immediate support on the hourly chart has moved up to 10170, with the stop-loss of which, trading longs should be held on to.

CPI for November and IIP for October will be released today. CPI is expected to inch up to 4.20% from October's 3.58% level. IIP is expected to ease to 3% from previous month's 3.8% level.


Fed begins its two-day meeting today. Markets are expecting an interest rate hike and will watch out for FOMC members' views on the outlook for the U.S. economy.

Monday, December 11, 2017

NIFTY SET TO ACHIEVE 10285 TARGET; 10140 IS THE IMMEDIATE SUPPORT

NIFTY SET TO ACHIEVE 10285 TARGET; 10140 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

US indices gained 0.4%-0.6% with the Dow and S & P 500 closing at fresh record high after the release of a stronger-than-expected jobs report.

The U.S. economy added 228,000 jobs last month, the expected figure being 200,000. The unemployment rate held steady at 4.1%. Average hourly earnings rose 0.2% for November and 2.5% for the year.

European markets gained 0.3%-1.4%, reacting to progress in Brexit negotiations and a long-sought deal regarding global banking regulations.

For the week, Dow and S & P 500 gained 0.4% each but Nasdaq fell 0.1%. European markets gained 1.3%-2.6%. In Asia, Shanghai and Hang Seng fell 0.8% and 1.5% respectively while Nikkei was flat.

AT HOME

Benchmark indices soared nearly a percent, extending the winning streak to second straight day. Sensex climbed 301 points to settle at 33250 while Nifty finished at 10266, up 99 points. BSE mid-cap and small-cap indices rose 0.9% and 1% respectively. All the BSE sectoral indices ended in green with FMCG and Metal indices leading the tally, up 2.2% and 1.4% respectively.

FIIs net sold stocks and index futures worth Rs 675 cr and 745 cr respectively but net bought stock futures worth Rs 219 cr. DIIs were net buyers to the tune of Rs 1243 cr.

Rupee appreciated 11 paise to end at 64.46/$.

For the week, Sensex and Nifty gained 1.3% and 1.4% respectively.

66.75% voter turnout was recorded in the phase 1 of the Gujarat assembly elections held for 89 of the state's 182 constituencies. Next phase will be held on 14th.

OUTLOOK

Today morning, Asian markets are trading flat to modestly higher and SGX Nifty is suggesting about 15 points higher start for our market.

After Nifty took out the immediate hurdle of 10160 on Thursday we had given the upside target of 10285 on Friday.

Nifty soared 99 points to settle at 10266 and is set to open higher today which will nearly achieve 10285 target.

10285 is the two-third retracement level of the recent 10410-10033 fall and 34-DMA is placed around 10290, making this and immediate resistance zone. Once 10290 is taken out, Nifty would move towards 10370 where a trendline adjoining recent tops on the daily chart presents a resistance.


Meanwhile, immediate support on the hourly chart has moved up to 10140, with the stop-loss of which, trading longs should be held on to.

Friday, December 8, 2017

10285 ABOVE 10183; 10120 IS THE IMMEDIATE SUPPORT

10285 ABOVE 10183; 10120 IS THE IMMEDIATE SUPPORT

WORLD MARKETS                             

Dow and S & P 500 gained 0.3% each while Nasdaq rose 0.5%, looking to Washington for clues about tax reform and a possible government shutdown.

Material stocks perked up on news that President Donald Trump plans to unveil an infrastructure spending plan in 2018.

U.S. crude rose 1.3% to $56.69 per barrel and Brent gained 1.6% to settle at $62.20.

European markets, except a 0.4% lower FTSE, gained 0.2%-0.8%.

AT HOME

After a positive start benchmark indices saw a sustained northward move through the session to end with hefty gains of more than a percent with Sensex and Nifty registering biggest single day gain since 1st November and 25th May respectively. Sensex soared 352 points to settle at 32949 while Nifty finished at 10167, up 123 points. BSE mid-cap and small-cap indices climbed 1.4% and 1.3% respectively. All the BSE sectoral indices ended in green with Telecom and Utilities indices leading the tally, up 4.8% and 2.9% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 1076 cr, 914 cr and 342 cr respectively. DIIs were net buyers to the tune of Rs 927 cr.

Rupee depreciated 5 paise to end at 64.57/$.

OUTLOOK

Today morning, Shanghai is down 0.2% but Nikkei and Hang Seng are up 0.9% and 0.4% respectively. SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that having broken 10090 support, next support for Nifty is at 9950 and had advised trailing stop-loss in short positions to 10160.

Nifty soared 123 points to end at 10167, taking out the 10160 hurdle.

A crossover of 10183, the top made in last hour, would confirm a "buy" on the hourly chart and would pave the way for further upmove. 10285, the two-third retracement level of the recent 10403-10033 fall, which also coincides with 34-DMA, would the upside target as well as the resistance if that happens.

Traders can initiate long positions with the stop-loss of 10120, which is the immediate support on the hourly chart, once 10183 is crossed.


November jobs report to be released in the US is expected to show a gain of 200,000 jobs.

Thursday, December 7, 2017

NIFTY BREAKS 10090 SUPPORT; 9950 NEXT

NIFTY BREAKS 10090 SUPPORT; 9950 NEXT

WORLD MARKETS                             

Dow lost 0.2%, S & P 500 ended flat while Nasdaq rose 0.2% yesterday as tech stocks rose on the back of gains in Facebook while energy stocks fell on falling crude.

U.S. Senate yesterday voted to go to a conference committee with the House to negotiate a plan to reform the tax system after both chambers passed separate bills earlier.

West Texas Intermediate crude fell 2.9% to $55.96 per barrel and Brent fell 2.6% to $61.22 after data showed a larger-than-expected increase in U.S. gasoline stocks.

U.S. private payrolls rose 190,000 in November, above the 185,000 forecast by economists in a Reuters poll, but below the 235,000 seen in October.

Markets also looked ahead to a potential government shutdown. If Congress fails to craft a deal on government spending by the end of the week, the federal government could close until a deal is struck.

Dollar index rose about 0.25% to 93.52, the highest level in more than two-weeks.

In Europe, except a 0.3% higher FTSE, other markets fell upto half a percent.

AT HOME

Benchmark indices tumbled nearly two-third of a percent with Sensex and Nifty closing at the lowest level since 23rd October and 11th October respectively. Sensex lost 205 points to settle at 32597 while Nifty finished at 10044, down 74 points. BSE mid-cap and small-cap indices lost 0.9% and 0.7% respectively. BSE Metal index nosedived 2%, becoming top loser among the sectoral indices, followed by 1.4% lower Telecom and Basic Material indices. Energy and IT indices were top gainers, up 0.5% and 0.3% respectively.

FIIs net sold stocks and index futures worth Rs 1218 cr and 446 cr respectively but net bought stock futures worth Rs 518 cr. DIIs were net buyers to the tune of Rs 995 cr.

Rupee depreciated 14 paise to end at 64.52/$.

RBI's monetary policy committee kept repo rate unchanged at 6% and maintained it's neutral stance but upped the retail inflation forecast for the second half of FY18 to 4.3%-4.7% from the earlier 4.2-4.6%. It retained FY18 growth forecast at 6.7%.

OUTLOOK

Today morning, Shanghai is down 0.3% but Nikkei and Hang Seng are up 1.2% and 0.5% respectively. SGX Nifty is suggesting a marginally higher start for our market.

Nifty yesterday lost 74 points to close at 10044, breaking the 10090 support decisively. Next support, as we have been mentioning, is placed at 9950, which is the two-third retracement level of the entire 9690-10490 upmove.


Immediate resistance on the hourly chart has moved lower to 10160, with the stop-loss of which trading shorts should be held on to.

Wednesday, December 6, 2017

NIFTY HOLDS 10090 ON CLOSING BASIS; RBI IN FOCUS

NIFTY HOLDS 10090 ON CLOSING BASIS; RBI IN FOCUS

WORLD MARKETS                             

US indices fell 0.2%-0.4% with the S&P 500 posting its first three-day losing streak since August.

Brent crude rose 0.7% or 45 cents to $62.90 a barrel and WTI rose 0.3% or 15 cents to $57.62.

Main European markets fell 0.1%-0.3% while Italy gained 0.2%. Basic resources stocks led the losses amid heavy falls in metals markets. The euro zone composite PMI surged to 57.5, up from 56.0 in October. That's the highest monthly reading in more than 6.5 years.

In the latest talks between the U.K. and the European Union, both sides failed to agree upon the terms for the U.K. leaving the political-economic bloc on Monday.

AT HOME

Benchmark indices ended marginally lower after a choppy trade. Sensex settled at 32802, down 67 points while Nifty lost 10 points to finish at 10118. BSE mid-cap index gained 0.4% while the small-cap index ended marginally in the red. BSE Power and Utilities indices fell 1.1% and 0.8% respectively, becoming top losers among sectoral indices while Telecom and Energy indices were the top gainers, up 0.8% and 0.6% respectively.

FIIs net sold stocks and index futures worth Rs 1471 cr and 1979 cr respectively but net bought stock futures worth Rs 278 cr. DIIs were net buyers to the tune of Rs 1074 cr.

Rupee ended flat at 64.38/$.

India's November Nikkei/IHS Markit Services Purchasing Managers' Index fell to 48.5 - its lowest since August - from 51.7 in October, well below the 50 mark that separates expansion from contraction.

The government yesterday announced incentives worth a total Rs 8,450 crore to boost exports and employment in labour-intensive sectors in the mid-term review of the five-year foreign trade policy (FTP) that was rolled out in 2015.

OUTLOOK

Today morning, Hang Seng is flat but Nikkei and Shanghai are down 0.8% and 0.4% respectively. SGX Nifty is suggesting about 20 points lower start for our market.

In yesterday's report we had reiterated the view that upon decisive breach of 10090, which is the 50% retracement level of the 9690-10490 upmove, the next downside target would be 9950, the two-third retracement level of the aforementioned upmove.

Nifty, after touching a low of 10069 in first half an hour, rebounded to end at 10118, holding on to 10090 support on closing basis.

10090 continues to be immediate support, upon decisive breach of which 9950 would be the next target to eye.

Immediate resistance on the hourly chart has moved lower to 10260, a crossover of which is required for taking a positive view on Nifty.


RBI's Monetary Policy Committee, at the end of its two-day meeting, is expected to leave policy rates unchanged. Markets would watch out for cues to future policy direction.