CONSOLIDATION CONTINUES

CONSOLIDATION CONTINUES

WORLD MARKETS                             

US equities fell 0.1%-0.5% with Nasdaq posting its biggest 2-day slide since December as tech stocks fell.

Apple shares tumbled more than 2% after Mizuho Securities downgraded the company's stock from "Buy" to "Neutral."

Treasurys traded mixed with the benchmark 10-year note yield near 2.21% and the two-year yield hitting a one-month high of 1.355%.

European markets fell 0.2%-1.2%. Media reports indicate that the new government in the UK could adopt a soft Brexit to keep the U.K. in the single market despite previous statements and aims of the Conservative leader.  In Italy, the populist Five Star Movement seems to have suffered a severe setback in local elections on Sunday, whereas in France, the party of the independent President Emmanuel Macron is set to get a huge majority in parliamentary elections trouncing traditional parties.

AT HOME

Benchmark indices fell nearly half a percent today to end at lowest level in nearly two weeks. Sensex fell 166 points to settle at 31096 while Nifty finished at 9616, down 52 points. BSE mid-cap and small-cap indices gave away 0.5% and 0.6% respectively. BSE Capital Goods index tumbled 1.6%, becoming top loser among the sectoral indices, followed by 1.3% each cut in Consumer Durable and Industrial indices. IT and Healthcare indices gained 0.4% and 0.3% respectively.

FIIs net sold stocks, index futures and stock futures worth Rs 169 cr, 1304 cr and 607 cr respectively. DIIs were net sellers to the tune of Rs 63 cr.

Rupee closed at 64.43/$, depreciating 19 paise compared to previous close.

India's retail inflation rate fell to 2.18% in May, down from 2.99% in April and marking the lowest level since 2012.

IIP data for April showed industrial output slowed to 3.1% from 3.8% in March.

OUTLOOK

Today morning, Nikkei and Shanghai are marginally in the red while other Asian markets are trading with modest gains. SGX Nifty is suggesting about 15 points higher start for our market.

Nifty, after achieving the 9700-9725 target, has been in a consolidation mode for last five sessions. As we have been mentioning, a crossover of  9710, the top made last week, is required for a fresh upmove. If that happens, 9820 would be the next upside target to eye. On the way down, 9580-9590 continues to be immediate support area below which 34-DMA, placed around 9480, would be the next important support to eye.

Fed begins its two-day meeting today and is widely expected to hike interest rate. Fed Chair Janet Yellen is also expected to talk more about how the Fed could move ahead to pare back its massive $4.5 trillion balance sheet later this year.