It was a flat start for the Indian market at the start of the new series. Asian indices were trading weak. Automobile and cement shares will be in focus as companies from these two sectors will start unveiling monthly sales volume data for May 2012 from today, 1 June 2012.
The rupee recovered from a weak open to gain to above 56 to the dollar on Friday, though broader sentiment was weak as the euro fell to a two-year low, reflecting the worsening euro zone debt crisis and disappointing Chinese manufacturing data.
Aviation stocks were flying high on reports that the state-owned oil companies on Thursday cut jet fuel prices by 2%. Jet fuel or aviation turbine fuel (ATF) accounts for almost half of an airline's operating cost. The prices of jet fuel are directly linked to crude oil prices.
Maruti Suzuki, Tata Motors, ICICI Bank, Jaiprakash Associates and Axis Bank were top gainers on the Nifty. Cairn India, Wipro, Sesa Goa, Asian Paints and SAIL were top losers.
China's official PMI data comes in at 50.4 versus a forecast of 51.1. Right now, Taiwan is down 1.6%; Nikkei is down 1%; Straits is down 0.8%; Kospi is down 0.7% and Shanghai is up 0.25%.
The US markets ended lower with major indices logging their worst May since 2010 on the back of concerns over the euro zone debt crisis in addition to worries over a slowing US economy. For the month, the Dow and the S&P 500 dropped more than 6%, while the Nasdaq plunged nearly 7%.
The 200-day SMA (Simple Moving Average) and 20-day EMA (Exponential Moving Average) have now shifted to 16800 / 5070 and 16429 / 4980, respectively. The ‘20-Week EMA’ is placed at 16930 / 5130 level.
Indices have taken a support near 16113 / 4886 level, which is the 61.8 % Fibonacci Retracement level of the rise from 15847 / 4804 (Low on 23rd May, 2012) to 16544 / 5020 (High on 29th May , 2012).
The candlestick pattern on the weekly chart represents another bullish “Hammer”.
Rolls in Nifty futures lower than last month with Nifty rolls at 58%, well below 6-month average of 66% (it is lowest in last six months), also in value terms, it is at 7360 Cr. versus 10088 cr (number of shares 149 lakh versus 193 lakh shares).
Among stock futures few sectors have shown change of sentiment, suggesting that can help Index to stay afloat going forward in the JUNE series. Overall Banking (PSU Banks have seen short squeeze), Metals and Capital Goods should be watched carefully as they have shown C-o-C improve across counters. On other hand, sectors which might underperform are Auto, Power, Fertilizer,Sugar, Transport,Textile and Infrastructure.
Currency & Commodity Check
In the currency space, weakness in the euro continues after it fell to fresh 23-month low versus the dollar. The euro also hit an eleven-and-half year low against the rallying Japanese yen. The dollar index is holding firm above the 83 mark.
In commodities, crude prices slipped further ending May with their biggest monthly decline in more than three years following bloated US stockpiles and weak economic data. Brent currently is trading around USD 101 per barrel levels. Brent has fallen more than 21% from its 2012 high of USD 128.40 per barrel.
FIIs net buy USD 15.3 million in cash market on May 30
FIIs were net sellers in the index futures segment and cash segment to the tune of Rs 1252 crore and Rs 666 crore, respectively
Total Puts add 76 lakh shares in Open Interest
The benchmark index Nifty slipped below 4900 mark in the afternoon trade. Asian shares and the euro extended losses on Friday as China's factory activity data delivered its weakest reading this year, highlighting concerns the worsening euro zone debt crisis will further undermine global economic growth.
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Mkt resilient at current level; bullish auto: ICICI Pru AMC