CPI HITS 21-MONTH HIGH; NIFTY ACHIEVES 8074 TARGET

CPI HITS 21-MONTH HIGH; NIFTY ACHIEVES 8074 TARGET

WORLD MARKETS                             

US indices fell 0.7%-0.9% on persistent Brexit fears and looking forward to central bank meetings in the U.S. and Japan.

In the U.K., an ORB poll for the Telegraph showed 48% of Britons would vote to remain in the European Union, while 49% would vote to leave. A YouGov poll for the Times of London showed 46% preferred to leave, while 39% wanted to remain. Popular British newspaper The Sun also endorsed the leave vote.

The U.S. Federal Open Market Committee will begin its two-day meeting starting today. The Bank of Japan starts its two-day meeting tomorrow where some additional easing measures are expected.

Shares of Microsoft closed 2.6% lower after news the tech giant is purchasing LinkedIn for $196 per share in an all-cash transaction valued at $26.2 billion. LinkedIn soared 46.6%.

US oill settled down 19 cent or 0.39% to $48.88 a barrel. Gold rose $11 to $1287 an ounce, a four-week high.

European markets gave away 1.2%-2.9%

Earlier, Nikkei 225 fell 3.5% while the Shanghai composite lost 3.2% and the Hang Seng fell 2.5%.

AT HOME

After falling about a percent and third in the morning trade, Sensex and Nifty recouped some of the losses in the noon trade to end lower by 0.9% and 0.7% respectively, extending the losing streak to third straight day. Sensex lost 239 points to settle at 26397 while Nifty finished at 8111, down 59 points. BSE mid-cap and small-cap indices lost half a percent each. Except a 0.1% each rise in Healthcare and Energy indices, all the BSE sectoral indices ended in red with Telecom and Finance indices leading the tally, down 1.7% and 1.4% respectively.

FIIs net bought stocks worth Rs 212 cr but net sold index futures and stock futures worth Rs 616 cr and 1387 cr respectively. DIIs were net sellers to the tune of Rs 597 cr.

Rupee depreciated 37 paise to end at 67.13/$.

India's May CPI spiked up to 5.76%, a 21-month high Vs April's upwardly revised 5.39% level, as food inflation surged to 7.6%

OUTLOOK

Today morning, Nikkei is down more than a percent, other Asian markets are trading with modest cuts and SGX Nifty is suggesting about 15 points lower start for our market.

Nifty, by touching a low of 8064 yesterday, achieved the first target of 8074 we were working with after 8184 support was breached. The benchmark rebounded from there to close at 8111 but is set to open mildly lower today.

8064, the low made yesterday, is the immediate support, upon breach of which, next target to eye would be 8005, which is the 50% retracement level of the 7716-8295 upmove.

Immediate resistance on the hourly chart is placed around 8215, with the stop loss of which trading shorts can be held on to.