3 November 2016


The Indian equity market closed down for a second straight session, as trading resumed after a public holiday. Sentiments were positive in the first half, thanks to upbeat core sector data and expansion in manufacturing PMI figures. Sensex fell for fourth day in a row while Nifty settled below its crucial psychological level of 8,500 for time in nearly four months on the back of a broad-based selloff. Uncertainty over a tight US presidential election is weighing on the sentiment and investors are offloading risk assets like equities and resorting to gold as a safe haven bets and gold prices in international markets have been on an upward spiral. The Sensex ended with a loss of 97 points at 27430. The Sensex opened at 27518 touched an intra-day high of 27601 and low of 27399. The Nifty closed with a loss of 29 points at 8485. The NSE Nifty opened at 8499 hitting a high of 8538 and low of 8476. Overall it was rangebound session for the market but late sell-off drove the Nifty below crucial support level of 8500. Benchmark indices closed lower for the fourth consecutive session.

Little respite is expected until at least next week, but surprises from US jobs data or Bank of England, could allow markets let go off election worries, while consensus on GST rates, could also give a distraction for domestic markets. If Donald Trump wins and the market takes a dive, it will be a perfect opportunity to buy. From medium term perspective the key support is at 8460-8430 level. We expect this level as important one and likely to absorb any further selling pressure. And most likely market to hold above this level. On the upside supply is coming at 8550, breaking of the level market will find the momentum which is lacking couple of days and will then set for moving above the recent swing high at 8580 level. Investor is advised to initiate long on a break above 8580 with a stop below 8400.
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Supports: 8460 and 8430
Resistances: 8550 and 8580

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