NIFTY MARCHES TOWARDS 8655 TARGET; TRAIL STOP LOSS TO 8670

NIFTY MARCHES TOWARDS 8655 TARGET; TRAIL STOP LOSS TO 8370

WORLD MARKETS                             

Extending Friday’s rally on the back of positive jobs report and cheering an election in Japan, US indices gained 0.3%-0.6% yesterday with S&P 500 closing at a new all-time high and also posting a new all-time intraday high of 2,143.16.

Earlier, Nikkei climbed 4% after Prime Minister Shinzo Abe's ruling coalition won election in upper house, which is likely to make it easier for Abe to push through economic reforms. Hang Seng gained 1.5% while Shanghai rose 0.2%.

US oil fell 1.4% to $44.76 a barrel,  touching two-month lows on oversupply fears after lesser-than-expected drawdown in U.S. crude and gasoline inventories data released last week and rising U.S. oil drilling rig counts. Brent fell 1.1% to $46.25.

European markets climbed 1.2%-2.1%. British pound briefly spiked after U.K. lawmaker Andrea Leadsom pulled out of the race to become the country's prime minister, clearing the way for Interior Minister Theresa May. The best-performing sector was basic resources stocks, closing 4 percent higher, as metal prices rose.

AT HOME

After a mini vacation, bulls were back to work as benchmark indices soared little less than 2% yesterday to close at the highest level since 19th August 2015. Sensex climbed 500 points to settle at 27627 while Nifty finished at 8468, up 145 points. BSE mid-cap and small-cap indices added 1.5% and 0.8% respectively. All the BSE sectoral indices ended higher with Metal and Finance indices leading the tally, up 2.5% and 2.2% respectively.

FIIs net bought stocks and index futures worth Rs 1056 cr and 1126 cr respectively but net sold stock futures worth Rs 549 cr. DIIs net sold stocks worth Rs 611 cr.

Rupee appreciated 24 paise to close at 67.12/$.

Indusind Bank reported in-line with estimated 26% growth in April-June quarter profit at Rs 661 cr. NII jumped 38% to Rs 1356 cr and was better-than-expected. Net Interest Margin improved to 3.97% from 3.68% y-o-y. Asset quality slightly weakened as gross NPA increased to 0.94% from 0.87% q-o-q and net NPA rose to 0.38% from 0.36%.

OUTLOOK

Today morning, Nikkei is up more than 3%, other Asian markets are trading with gains of upto a percent and SGX Nifty is suggesting about 40 points higher start for our market.

Just to reiterate, we have been working with the major upside target of 8655 ever since 8243, the 61.8% retracement level of the entire 9119-6826 fall, was taken out on weekly basis on 1st July.

Nifty yesterday soared 145 points to 8468 and a positive start today is likely to take it to 8500 mark.

8655 continues to be next major target and hold long positions with a trailing stop loss continues to be the advise.

Immediate support on the hourly chart has moved up to 8370, which should serve as the revised stop loss.

May IIP and June CPI data will be released today. June CPI is expected at 5.75% as against 5.76% in May. Core CPI is expected to remain unchanged at 4.7%. May IIP is expected to contract by 0.12% as against contraction of 0.8% in April.