STAY LONG WITH THE STOP LOSS OF 8490

STAY LONG WITH THE STOP LOSS OF 8490

WORLD MARKETS                             

While the Dow ended marginally lower pressured by disappointing earnings from Disney, S & P 500 and Nasdaq gained 0.3% and 0.7% respectively, breaking the three-day losing streak.

All three indices however ended more than half a percent off the day high as energy stocks fell on the back of weakness in oil. Nymex oil fell 59 cents to $45.15 a barrel, setting a fresh post-March low.

Shares of Disney plunged more than 9% after missing on revenue in its earnings report.

Economic releases were mixed. The non-manufacturing ISM index beat expectations, hitting a 10-year high of 60.3 in July. The ADP report came in at 185,000, below expectations for 215,000 private-sector payrolls. The July trade report showed the deficit widened to $43.84 billion.

European markets gained 1%-1.9% following a slew of positive earnings, led by French bank Societe Generale which rallied 8% after reporting earnings that beat expectations.

AT HOME

After gaining nearly three fourth of a percent in the initial trade, benchmark indices traded in a narrow range through rest of the day and finally ended higher by about six tenth of a percent. Sensex settled at 28223, up 151 points while Nifty gained 51 points to finish at 8568. BSE mid-cap and small-cap indices rose 0.8% and 1% respectively. BSE Realty index soared 3.3%, becoming top gainer among the sectoral indices, followed by 1.8% rise in IT index. Bankex lost 0.3%, becoming top loser, followed by 0.04% cut in Metal index.

FIIs net bought stocks, index futures and stock futures worth Rs 448 cr, 598 cr and 228 cr respectively. DIIs were net sellers to the tune of Rs 189 cr.

Rupee closed unchanged at 63.7475/$.

India's Nikkei Services PMI for July came in at 50.8, improving from 47.7 in June and moving into expansion territory.

Cognizant reported strong 6% dollar revenue growth in the quarter ended June and also raised full year guidance for the second time in 2015.

OUTLOOK

Today morning, barring a half a percent higher Nikkei, other Asian markets are trading with cuts of upto half a percent and SGX Nifty is suggesting a modestly lower start for our market.

In yesterday's report we had reiterated our view of holding on to the long positions with the stop loss of 8430 for the immediate target of 8655. The benchmark, after touching a high of 8592, closed at 8568, moving towards the 8655 target.

Immediate support on the hourly chart has now moved up to 8490, which should serve as the new stop loss for trading longs.