NIFTY EXTENDS WINNING STREAK TO SIXTH DAY; TRAIL STOP LOSS TO 8055

NIFTY EXTENDS WINNING STREAK TO SIXTH DAY; TRAIL STOP LOSS TO 8055

WORLD MARKETS                             

US indices gained between 0.7%-0.9%, helped by a recovery in health care stocks and gains in energy, as investors awaited the beginning of earnings season.

YUM Brands plunged 18.8% after reporting earnings that missed expectations.

Weekly mortgage applications rose 25.5%. August consumer credit increased to $16.02 billion, while July consumer credit was revised up to $18.94 billion from $19.10 billion.

Nymex oil fell 72 cents or 1.5% to $47.81 a barrel, giving back some of Tuesday's 5% surge, after weekly oil inventories showed an increase of 3.073 mn barrels, above expectations of an increase of 2.5 mn barrels. Brent settled at $51.33/bbl, down 59 cents or 1.14%.

Copper gained after The International Copper Study Group said it expects the global copper market will see a deficit of 130,000 tonnes in 2016, reversing its prior estimate of a 230,000-tonne surplus.

European markets, except a 0.8% lower Italy, gained upto 0.7% with auto stocks and miners outperforming. Volkswagen gained 7% after new chief executive, Matthias Mueller, gave details in an interview with a German newspaper about his plans to handle the diesel emissions crisis.

AT HOME

Benchmark indices ended higher by a third of a percent after a choppy trade, extending the winning streak to sixth straight day. Sensex settled at 27036, up 103 points while Nifty rose 24 points to end at 8177. BSE mid-cap and small-cap indices gained 0.1% and 0.4% respectively. Except a 1.6% and 1.4% cut in BSE IT and Teck indices respectively, all the sectoral indices ended in green with Metal and Realty indices leading the tally, up 2.8% and 1.9% respectively.

FIIs net sold stocks and stock futures worth Rs 51 cr and 463 cr respectively but net bought index futures worth Rs 1140 cr. DIIs were net sellers to the tune of Rs 219 cr.

Rupee appreciated 42 paise to end at 64.98/$, a near 8-week high.

OUTLOOK

Today morning Shanghai has opened more than 3% higher after a week long holiday. Other Asian markets are trading mixed and SGX Nifty is suggesting about 15 points higher opening for our market.

Ever since Nifty established higher-top higher-bottom formation on the daily chart by crossing immediate previous top of 8055, we have been working with initial target of 8220, where the 20-week moving average is placed, followed by 8380, where 200 DMA is placed.

The benchmark closed at 8177 yesterday and is on track to achieve the 8220 target.

Immediate support on the hourly chart has moved up to 8055, with the stop loss of which trading longs should be held on to.