NIFTY - Rural and Retail Retail has been supporting the economies world over, yesterday US Retails sales demonstrates one more time. With Services continuing to print robust numbers, the inflation story is not fading away. The markets cheer with stronger data, but stable rate look. Pause is no hike, is a cut. This assumption continues, despite receding liquidity. Wealth effect continues to play bigger part than the scare of liquidity. Leaders in sweet spot, inflation financing as well as growth trajectory, welcome to world of stagflation. Clearly own the assets, thus own the equity remains the path to tread. Reports of Rural inflation continuing to surpass the Urban inflation is cause for worry for FMCG, no wonder markets are ahead in treating them with underweight. Small and Midcaps more or less will print outside week pattern. They have gone up near 40% in six months, annualised 80%. There select profit taking to continue. On the other sector IT, Sugar, Services, Metals, PSU remain stronger in addition to the Mighty Banks. Chines CRR cuts, ECB rate hike (last one is the assumption?) pushes risk assets higher, that includes the Crude Oil. Clearly markets are stretching to spaces of discomfort. Central Bankers will remain higher for longer. WPI comes softer, that is another point of comfort. The weekly graph Advance Block ideally today to move further high, with no lower wick and no upper wick, ask me if it is bullish or bearish at your own ignorance. The PIP clearly shows much easier support around the 20060 to push higher towards the 20180-20230.
For the day, buying with stops 20060 for move towards 20230-250 remains, also the RR is favourable to carry over the weekend. Keep in mind the trick is large caps than small caps.
