NIFTY EXTENDS WEAKNESS AS EXPECTED; STAY SHORT WITH THE STOP-LOSS OF 10415

NIFTY EXTENDS WEAKNESS AS EXPECTED; STAY SHORT WITH THE STOP-LOSS OF 10415

WORLD MARKETS                             

Dow ended flat while S & P 500 and Nasdaq gained 0.1% and 0.3% respectively

Banks fell after Republicans lost key elections in New Jersey and Virginia on Tuesday which increase uncertainty around the GOP's plans to move forward with tax reform. Banks were also pressured by a flattening yield curve. The spread between the two and the 10-year U.S. bond yields hovered around 70 basis points, its lowest level in a decade.

Trump's tour of Asia also remained in the spotlight. Trump is expected to discuss issues relating to trade and North Korea with Chinese leaders in Beijing today. The president also took to Twitter to warn North Korea not to underestimate the U.S., repeating statements he had made when addressing South Korea's National Assembly on Wednesday.

In Europe, FTSE gained 0.2%, DAX ended flat while CAC and Italy fell 0.2% and 0.6% respectively. Financials and banking stocks underperformed on earnings and doubts over U.S. plans to reform the tax system.

AT HOME

Benchmark indices fell about half a percent, extending the losing streak to second straight day. Sensex lost 152 points to settle at 33219 while Nifty finished at 10303, down 47 points. BSE mid-cap and small-cap indices tumbled 0.8% and 1% respectively. Except 0.4% and 0.1% higher IT and Teck indices respectively, all the BSE sectoral indices ended in red with Metal index leading the tally, down 1.6%, followed by 1.5% lower Energy and Telecom indices.

FIIs net sold stocks, index futures and stock futures worth Rs 3838 cr, 602 cr and 2288 cr respectively. DIIs were net buyers to the tune of Rs 3038 cr.

Rupee appreciated 8 paise to end at 64.95/$.

OUTLOOK

China October PPI and CPI have come in at 6.9% and 1.9% respectively, which are higher than the expected figures of 6.6% and 1.8% respectively.

Today morning, Nikkei is up 1.3%, Hang Seng is up 0.7% and other Asian markets are trading with modest gains. SGX Nifty is suggesting about 25 points higher start for our market.

After Nifty broke the immediate support of 10380 on Tuesday, we had given downside target range of 10250-10200 in yesterday's report and had advised holding on to short positions with the stop-loss of 10450.

Nifty yesterday touched a low of 10285 before closing at 10303 and is set to open modestly higher today.

10250, where previous top on the daily chart is placed, continues to be immediate support below which 10180, where 38.2% retracement level of the 9690-10490 upmove is placed, will be the next support to eye.

Immediate resistance on the hourly chart has moved lower to 10415, with the stop-loss of which, trading shorts should be held on to.

Tata Motors and Aurobindo Pharma will report their quarterly earnings today.

Two-day GST Council meeting begins today. On agenda would be pruning 28% list and libersalisation of composition scheme.

Himachal Pradesh goes to polls today with traditional rivals, the Congress and the BJP locking horns in all 68 constituencies