NIFTY CONSOLIDATES AFTER THREE DAY GAINS; 8660 CONTINUES TO BE IMMEDIATE SUPPORT

NIFTY CONSOLIDATES AFTER THREE DAY GAINS; 8660 CONTINUES TO BE IMMEDIATE SUPPORT

WORLD MARKETS                             

S & P 500 ended absolutely flat, Dow added 0.1% and Nasdaq gained 0.3% yesterday, digesting weak manufacturing data, fall in oil and awaiting Friday's key jobs report.

WTI crude fell 3.5% to $43.16 a barrel and Brent was down 3.1% at $45.45.

The U.S. ISM manufacturing index for August came in at 49.4, which was the weakest reading since January and indicated sector contraction. The Markit manufacturing PMI stood at 52. Second-quarter productivity dropped 0.6% while weekly jobless claims came in at 263,000, slightly better than expectations.

Dollar index fell to 95.65 from 96. Gold gained $6 to $1317 an ounce.

In Europe, CAC ended marginally in the green while DAX and FTSE fell half a percent. Sterling jumped over 1% against the U.S. dollar to trade at around $1.329 after data showed that the U.K. manufacturing industry saw a strong post-Brexit vote rebound in August.

AT HOME

After three-day upmvoe, today was a day of consolidation as benchmark indices ended marginally lower after a rangebound but choppy trade. Sensex settled at 28423, down 29 points while Nifty lost 12 points to finish at 8775. BSE mid-cap and small-cap indices lost 0.4% each. BSE Telecom index plunged 5.7%, becoming top loser among the sectoral indices, followed by 2% cut in Realty index. Auto and Metal indices were the top gainers, up 0.4% and 0.3% respectively.

FIIs net sold stocks and stock futures worth Rs 302 cr and 405 cr respectively but net bought index futures worth Rs 364 cr. DIIs were net buyers to the tune of Rs 308 cr.

Rupee appreciated 1 paise to end at 66.95/$.

Government will seek Presidential assent for the landmark Constitution amendment bill for GST as 16 states have ratified the legislation. After the Presidential assent, the government will notify the GST Council. Union Finance Minister will head the Council, which will comprise state Finance Ministers. The GST Council will decide on the tax rate, cess and surcharges which are to be subsumed and also decide on the goods and services which would be exempted from the purview of the new indirect tax regime.

Bharti Airtel, Idea and R Com nosedived after Mukesh Ambani, speaking at the AGM of Reliance Industries, announced that Jio, the telecom venture of the group, would offer free voice calls, zero roaming charges, cheap data and a four-month introductory offer for free.

Maruti reported 12.2% y-o-y growth in August sales at 1.32 lac units. M & M reported 14% growth in auto sales at 40591 units and 16% growth in tractor sales at 13543 units. Eicher Motors sold 32% more Royal Enfields at 55721 units. Commercial Vehicles segment registered a growth of 13% at 4191 units. Hero Moto reported highest growth of 28% for 2016 at 6.6 lac units. TVS Motors reported 20% jump at 2.74 lac units. Tata Motors reported 6% growth at 43061 vehicles. Ashok Leyland reported 6% dip at 10897 units.

India's Nikkei/Markit manufacturing PMI rose to 52.6 in August from July's 51.8, hitting 13-month high and marking its eight month above the 50 level that separates growth from contraction.

OUTLOOK

Today morning, except 0.3% higher Hang Seng, other Asian markets are trading little changed and SGX Nifty is suggesting a flattish start for our market.

Yesterday was a day of consolidation as Nifty traded within the previous day’s range and ended marginally lower, digesting gains made over previous three sessions.

8845, the top made in April 2015, continues to be the immediate upside target to eye above which 8915 would be the next stop.

8660 continues to be the immediate support on the hourly chart, with the stop-loss of which trading longs should be held on to.

Key data to watch out today would be the US August employment report where addition of 180000 jobs is expected. This number would be the key determinant in deciding whether the U.S. Federal Reserve increases interest rates in September.

Indian markets will remain shut on Monday for Ganesh Chaturthi.