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§ After Thursdays selling spree the index continued to be in a bear grip on Friday as it dropped more than 2% on heavy selling pressure across the board. Nifty has broken all key short-term supports and closed at the lowest point of the week signaling a bearish undertone. On the weekly chart, a ‘Bearish Engulfing’ candlestick pattern has been formed on substantial volume and most importantly at the high of the year, indicating the potency of the pattern. Momentum oscillators have triggered sell signals on the daily chart as well as on the weekly chart. Market wide breadth and Nifty 50 stocks breadth was strongly in favor of bears. Nifty is expected to drop down to 10 weekly EMA (5990) that has acted as a bullish pivot of the uptrend from 5350 low. Additionally the recent 5937 low will act as a major support for the index which if breached opens the possibility of a deeper cut towards 5840 trend line support. On the flipside rallies towards 6190 are likely to face selling pressure.
§ All the sectoral indices closed in the negative. The drop was triggered by selling pressure in Realty, Consumer Durables and Metals stocks. Healthcare and FMCG shares outperformed the index. Bullish Setups: ITC, CHMB, RPWR, HDFC, WLCO. Bearish Setups:JSP, BHEL, HPCL, GSPL, RBXY, MSEZ
§ Most global indices ended the week in the red on a sharp dollar recovery and consequently profit taking in risk assets. The medium term trend remains positive, whereas short-term jerks can continue. DXY is building on previous gains, forming higher top higher bottom on daily charts. Momentum oscillator on daily and weekly charts has triggered a buy indicative of a sustainable upmove towards 80.10. Gold has dropped from the high of $1424 to $1360, however the uptrend remains intact held by the rising trend line support at $1345.
§ Interesting chart setups: TATA, LT, ITC, JSP, HPCL, BHEL
§ In a broad-based sell off, key benchmark indices tumbled, extending last two day losses as a plunge in Chinese stocks dragged world markets lower on Friday. Investors fretted if Beijing will take new steps to cool the world's No. 2 economy; global leaders met in South Korea, papered over currency tensions. In the domestic market, industrial output rising lower than estimated in September also dampened sentiment. Metal, banking, realty and consumer durables stocks fell. The market breadth was weak.
§ Nifty closed at 6071, down 122 points, while Sensex closed down 432 points at 20156.
§ Industrial output in September 2010 rose much slower-than-expected at 4.4% from 8.2% a year ago, as per government data released today. September IIP data is the lowest in 15 months. Meanwhile, the index of industrial production for August was revised upwards from 5.6% to 6.9%.
§ Gainers were Housing Development Finance Corporation (0.60%), Cipla (0.09%), and Hero Honda Motors (0.04%).
§ Losers were DLF (4.21%), Mahindra & Mahindra (4.09%), Hindalco Industries (3.93%), State Bank of India (3.50%), Tata Steel (3.23%), and Jindal Steel & Power (3.12%).
§ The Realty index was down 3.6%. Major losers were Indiabulls Real Estate (4.47%), DLF (4.21%), DB Realty (3.92%), Anant Raj Industries (1.08%), and Ackruti City (0.67%).
§ The Consumer Durables space was down 3.01%. Major losers were Whirlpool of India (4.33%), Gitanjali Gems (4.15%), Rajesh Exports (2.13%), Blue Star (1.05%), and Bajaj Electricals (0.53%).
§ The Metal index was down 2.94%.Major losers were Hindalco Industries (3.93%), JSW Steel (3.41%), Jindal Steel & Power (3.12%), Hindustan Zinc (3.01%), and National Aluminium Company (1.1%).
§ The Bankex index was down 2.21%. Major losers were Bank of Baroda(2.67%), Bank of India (2.06%), Federal Bank (1.95%), HDFC Bank (1.29%), and Canara Bank (1.29%).
§ Globally, Asian markets ended on a weak note, while Europe was trading in the red.
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