"Our markets were closed on account of "Gandhi Jayanthi" yesterday, while all Asian markets rallied on account of strong close of US markets on monday night. On 01.10.2007, our markets were volatile, made new highs and profit booking at higher level, in view of a holiday on 02.10.2007, came down at the end of the trading, although closed in positive territory, at new high closings. Nifty futures closed almost flat on monday, indicating indecisiveness on the trend.
Markets shall open positive today, taking monday strong closing of US markets initially, however, profit booking shall bring volatility in the markets from today onwards. Political crisis in karnataka state, Supreme Court's indiction of CM, Tamilnadu on defying the instructions to call off Bandh on 01.10.2007, Left-UPA co-ordination meeting scheduled for 05th where the issue of US-Nuke deal will occupy the top priority, are again bringing the political situation murky. Automobile companies sales numbers for September are encouraging, Steel prices are increased by manufactures, and cement companies are likely to increase the prices shortly, shall influence the momentum in these sectors.
In Our view, markets should consolidate around 5000 level for some time, may be till 11th october, when Infosys results will be announced, and take a direction from there on, depending on the performance, guidance and outlook for the sector. However, any weakness, below 4980 is a good buying opportunity in performing blue chip stocks, with medium term outlook, hence, keeping 10 to 15% cash levels shall provide great opportunity for building valuable portfolio for good returns.
Since the indices are in an unchartered territory, resistances cannot be predicted, only supports to be observed, whether held or breached to know and ride the trend which is up now on:
Short term support for Nifty shall be 5000-4940- 4880-4760-4678-4648-4564-4530-4480 and for Sensex shall be17160-17000-16876-16500-16135-15950-15870-15600-15485
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