"Making new highs, creating records of sorts on Indian Bourses have become order of the day, with the gush of foreign flows in to blue chips and index heavy weights. Sensex opened with a positive gap and traded firm throughout the day, and due to heavy short covering, closed above 19K, for the first time ever. Nifty's performance was even better, since ONGC started and finished the rally with whopping 242.15 points gain in a single day, which itself is a record. This type of gains are seen month on month basis in the initial stages of bull market during 2003-2004; while every one is surprised of weekly gains of 250 points on nifty till recent times in the last two years, single day gain of 242.15 points suggests that there is unprecedented 'euphoria' amongst foreign investors, who feel that india story is the best in troubled times in US, and strengthening of rupee continuously is encouraging them to take advantage of double whammy of higher returns on investment in markets and also exchange trade off, which is additional bonanza for investing in indian equities...especially growth stories.
TCS has posted stellar results, in one of the toughest environment, now has 1,00,000 employees on rolls, and is confident of better performance in the times to come, though they do not give any guidance as policy. The body language of the management sounds confident, and should give give relief to the software sector today, which is beaten after Infosys results were announced on 11.10.2007. However, one has to be stock specific, not to be bullish on the entire sector, as problems of appreciating rupee etc., still continue to daunt the sector. US markets opened weak on 57% drop in profit from Citibank, due to write off of subprime losses during the quarter, and closed negatively. Asian markets opened weak and are trading flat to negative. Nifty Futures have closed with a premium of 18 points on adjustment, shall invite some weakness in the initial hours of trading, however, the trend remains to be up, as long as Nifty trades above 5480 for the day.
Strategy for the Day: Buy 5500 calls on weakness and 5700 puts on rallies for quick trading.
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