8860-8690 CONTINUES TO BE THE IMMEDIATE RANGE

8860-8690 CONTINUES TO BE THE IMMEDIATE RANGE

WORLD MARKETS                             

After rising more than half a percent in the intial trade, Dow and S & P 500 gave away all the gains through the session to end flat while Nasdaq lost 0.2%.

US oil settled 0.6% higher at $43.30 per barrel, after gaining more than 2%, as Venezuela President said that OPEC and non-OPEC countries were close to reaching an output stabilizing deal. Brent rose 0.4%.

Dollar index fell to 95.87 from 96.04. US treasuries fell, with the two-year note yield near 0.77% and the benchmark 10-year yield around 1.7%. Gold rose $8 to $1318 an ounce.

European markets climbed 1%-1.5%

AT HOME

Sensex and Nifty gained 0.1% and 0.3% respectively, extending the winning streak to fourth straight day. Sensex settled at 28634, up 35 points while Nifty added 29 points to finish at 8808. BSE mid-cap and small-cap indices gained 0.6% and 0.5% respectively. Except a 0.4% lower FMCG index, all the BSE sectoral indices ended in green with Realty and Metal indices leading the tally, up 1.6% and 1.3% respectively.

FIIs net bought stocks and stock futures worth Rs 205 cr and 101 cr respectively but net sold index futures worth Rs 431 cr. DIIs were net sellers to the tune of Rs 252 cr.

Rupee appreciated 2 paise to end at 66.96/$.

OUTLOOK

Today morning, except a 0.3% higher Nikkei, other Asian markets are trading with modest cuts and SGX Nifty is suggesting about 15 points lower start for our market.

In yesterday's report we had mentioned that 8860, the upper level of the gap created by the big gap down opening last Monday, continues to be the immediate hurdle to eye, upon sustained trading above which, 8970 would the next important resistance. We had also said that 8690, the bottom made last week, is the important support to eye, a close below which, will also confirm a lower-top lower-bottom formation on the daily chart and would pave the way for the retest of the 8540 bottom, from where the rally had begun in the fag end of August.

That continues to be the view. Traders should wait for the breach of 8860 on the upside or 8690 on the downside for taking a fresh view on Nifty.

Central banks in Japan and the U.S. begin closely watched two-day policy meetings today. US Federal Reserve is widely expected to stay put, following a deluge of disappointing U.S. data. The BOJ, meanwhile, is expected to take some action, as speculation points to a possible rate cut deeper into negative territory.