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Major headlines:

·         Gold hits four week high as dollar weakens.

·         Key Indian equity market indices open higher

·         GST deadlock continues over high sea taxes FM hopes resolution.

Indian Indices: Asian indices traded in the green even as the Japanese 'Nikkei" traded flat after yesterday's massive almost 500 point rally. Renewed bout of global growth optimism saw equities regain momentum as investors bought stocks. Emerging markets also are seeing value buying emerge as investors allocate funds to EM ETF"s.

Nifty consolidated around 8200 with banks stocks being under pressure after the recent round of rate cuts. Materials, infra & IT stocks lead from the front with huge buying seen in mid cap leveraged stocks which should be prime beneficiary of lower rates. Nifty may consolidate around 8200 with an attempt to cross the 200 DMA placed @ 8270 with the real action being in the broader market.

The BSE Sensex is currently trading at 26820.56, up by 187.43 points or 0.70% after trading in a range of 26738.42 and 26823.25. There were 28 stocks advancing against 2 stocks declining on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.84%, while Small cap index was up by 0.85%.The CNX Nifty is currently trading at 8252.55, up by 62.05 points or 0.76% after trading in a range of 8223.70 and 8253.05. There were 47 stocks advancing against 4 stocks declining on the index.

Technical view: Nifty will find support around 8150 while 8270 which is the 200 DMA will act as resistance on the upside. Bank Nifty also finds support closer to 17750 & needs to cross 18092 on closing basis decisively for any further upside.

Market Sentiment:

The market breadth on BSE was positive in the ratio of 1685:522, while 98 scrips remained unchanged.

Trading ideas :HCLTECH (Buy above Rs 858 for target of Rs 888, SL at Rs 843): Stock has given a breakout from a downward sloping trendline resistance in yesterday's trade on the daily charts. On analyzing the hourly charts too, stock successfully broke out of a bullish cup and handle pattern. HCL tech becomes an ideal price-volume breakout counter, and looks good for further upside. We advise to Buy HCLTECH above Rs 858, stop loss at Rs 843 and Target of Rs 888.

MacroeconomicFront: The Indian Government has said that it has asked state governments to ensure that no additional charges are levied on e-payments to urban local bodies and also consider rolling out incentives like cash back on utility bills paid through digital means. Commenting on the issue, Union minister M Venkaiah Naidu told the media, "I request you to motivate all Urban Local Bodies (ULBs) in your state to switch over to electronic transactions for their payments as well as receipts.

Corporate Snippets:

Godrej Properties LTD GPL has sold more than 300 apartments with in two months of launch at its project Godrej greens in Pune. This represents more than 75% of the 400 apartments that were opened for sale.

Jubilant Life Sciences subsidiary has signed long term contracts in the US for the supply of some of its diagnostic and therapeutic products.

BGR Energy Systems has recently won two contracts worth Rs6.50 bn for setting up water treatment plants.

Top Sectoral& Stock Screening:   The top gaining sectoral indices on the BSE were Oil & Gas up by 1.57%, Metal up by 1.52%, PSU up by 1.21%, Auto up by 1.12% and Bankex up by 0.82%. The top gainers on the Sensex were Tata Motors up by 2.77%, Adani Ports & Special Economic Zone up by 2.39%, ONGC up by 2.08%, Wipro up by 1.84% and Sun Pharma up by 1.53%.

Nifty Movers:The top gainers on Nifty were Tata Motors up by 2.72%, Yes Bank up by 2.33%, Tata Motors - DVR up by 2.16%, Adani Ports & Special Economic Zone up by 2.15% and Bosch up by 1.93%. On the flip side, BhartiInfratel down by 2.20%, Mahindra & Mahindra down by 0.79%, Ambuja Cement down by 0.38% and HDFC down by 0.19% were the top losers.

On the global front: On the global front, Asian shares were trading mostly in green, with mainland China and Hong Kong gaining on a solid services PMI reading, while Japan edged down as the dollar weakened overnight and into Asia from 14-year highs against a basket of currencies as investors began to cast doubt the Fed would raise rates three times this year. The Caixin services PMI for China rose to 53.4, a tick above 53.3 expected and that followed solid manufacturing figures from China as well as Japan regionally this week

Global Signals: The Asian markets were trading mostly in green; Shanghai Composite increased 2.37 points or 0.08% to 3,161.17, FTSE Bursa Malaysia KLCI increased 6.59 points or 0.4% to 1,654.06, Jakarta Composite increased 19.79 points or 0.37% to 5,320.98, Taiwan Weighted increased 62.18 points or 0.67% to 9,349.14 and Hang Seng increased 277.94 points or 1.26% to 22,412.41. On the other hand, Nikkei 225 decreased 91.57 points or 0.47% to 19,502.59 and KOSPI Index decreased 1.58 points or 0.08% to 2,044.06.