BANG ON TARGET

BANG ON TARGET

WORLD MARKETS                             

Dow plunged 1% while Nasdaq and S & P 500 lost 0.7% each yesterday after negotiations between Greece and its creditors hit a stalemate.

The Eurogroup meeting yesterday ended without any agreement, raising the risks of a Greek debt default once again. Officials are slated to reconvene on Thursday at 11:00 GMT. Earlier media reports suggested that Greek Prime Minister told associates that creditors did not accepted Greece's proposed measures

In U.S. economic news, the final read on first-quarter GDP data showed a decline of 0.2%, in-line with expectations and above a previous estimate of a 0.7% contraction. Encouragingly, consumer spending was revised up to 2.1% from the initial 1.8%.

European markets, except a 0.2% higher FTSE, ended with cuts of upto 0.7%. Greek stocks fell 1.8%. On the data front, Germany's closely watched Ifo Business Climate survey index for June came in at 107.4, below expectations of 108.1.

Nymex oil fell 74 cents to $60.27 a barrel. Gold fell $4 at $1174 an ounce.

AT HOME

After gaining nearly half a percent, benchmark indices plunged about seven tenth of a percent from the top of the day in last hour to end lower by a fourth of a percent, breaking the eight day winning streak. Sensex settled at 27730, down 75 points while Nifty lost 21 points to finish at 8361. BSE mid-cap and small-cap indices lost 0.3% and 0.6% respectively.

The sudden late fall came after Greek Prime Minister Alexis Tsipras said that his government's proposed reforms have not been accepted by its international lenders. Media reports suggested that creditors have now put forward a new set of counter-proposals. A meeting of the Eurogroup of euro zone finance ministers to discuss the revised crisis plan is due to start later in the day.

Except a 0.7% and 0.4% rise in BSE Healthcare and FMCG indices respectively, all the sectoral indices ended in red with Metal and Realty indices leading the tally, giving away 1.6% and 0.9% respectively.

FIIs net bought stocks, index futures and stock futures worth Rs 93 cr, 1490 cr and 586 cr respectively. DIIs were net buyers to the tune of Rs 14 cr.

Rupee depreciated 1 paise to end at 63.595/$.

OUTLOOK

Today morning Asian markets are trading with cuts of upto half a percent and SGX Nifty is suggesting about 15 points lower opening for our market.

In yesterday's report we had clearly mentioned that "Considering the steep run-up over past eight sessions and looming resistances ahead, traders would do well to book majority of profit in trading longs in 8400-8490 resistance zone for entering back on any possible dip".

The benchmark, after touching a high of 8421, saw a sharp dip in last hour to end at 8361, vindicating our view.

8400-8490 continues to be major resistance area as 8470 is where 34-week moving average is placed, 8476 is where 20 week moving average is placed and 8490 is the immediate previous top on the weekly chart. A crossover of 8490 on weekly basis would also negate a lower-top lower-bottom formation on the weekly chart, which will turn the medium term view bullish.

Traders would do well to wait for the crossover of 8490 for taking fresh longs. Immediate support on the hourly chart is placed around 8300, below which 34-DMA, placed around 8240, would be the next target.

Talks in Brussels between Mr Tsipras and Greece's creditors are expected to resume at 07:00 GMT ahead of a Eurogroup meeting of eurozone finance ministers scheduled for 11:00 GMT.

The three-week monsoon session of Parliament will begin from July 21.