Taking the strong closing of Overseas markets, our markets opened on strong note, gap up and traded firm, inspite of profit booking by traders and trapped investors at high levels, for most part of the trading. When European markets opened in negative territory and US futures indicated weakness, a head of Fed chairman Mr.Bernarke, before congress, traders became nervous and cautious, as gap up and gap down openings are hurting retail investors, thus, resulting in indices giving away entire gains, by the end of the day, however, closing flat to marginally positive, holding the gaps created in the opening of trading. Though Mr.Bernarke made confession about the problems being faced by US economy, and steps taken to save the Bear Stearns from bankruptacy, investors are enthused by raise in private jobs data which showed + 8000 as against economists expectation of -40,000, made indices to trade in narrow range and close flat to marginally negative.
In this back drop our markets will now concentrate on domestic issues, expectation of performance of companies as results will start trickling in from next week, and the guidance for the coming financial year, will give reaction to stocks and sectors. US markets seem to have bottomed out, and will be on the verge of break out as expectations of another rate cut being expected in ensuing FOMC meeting on 30.04.2008. Nifty has closed around 4740 levels on both negative opening day and positive opening day, which is above 'march closing' gives an indication that the consolidation in the range of 4550 to 4950 for few days, will give a break out on upside to challenge the 200DSMA too. CBOE volatility index has dropped to 22 indicate reduction in volatility for the present, and markets might get into no interest zone, as investors, funds look for real cues on performance of Indian Economy from now on. Singapore Nifty futures are currently trading at 15 points premium.
Range for the Day: Nifty might trade in the range of 4650 to 4850 today.
In this back drop our markets will now concentrate on domestic issues, expectation of performance of companies as results will start trickling in from next week, and the guidance for the coming financial year, will give reaction to stocks and sectors. US markets seem to have bottomed out, and will be on the verge of break out as expectations of another rate cut being expected in ensuing FOMC meeting on 30.04.2008. Nifty has closed around 4740 levels on both negative opening day and positive opening day, which is above 'march closing' gives an indication that the consolidation in the range of 4550 to 4950 for few days, will give a break out on upside to challenge the 200DSMA too. CBOE volatility index has dropped to 22 indicate reduction in volatility for the present, and markets might get into no interest zone, as investors, funds look for real cues on performance of Indian Economy from now on. Singapore Nifty futures are currently trading at 15 points premium.
Range for the Day: Nifty might trade in the range of 4650 to 4850 today.
3 comments:
what makes you think that market will go up? inflation rising..quaterly results are expected weak...
(by the way iam regualar reader of your blog and like your nifty strategies)
Market is forward looking, most of the negative news is already factored in. Also, a relief rally is long due, then the next leg of selling could start.
Vinay
Dear Saba,
Thank you for keeping interest in the blog! Well, the answer to your querry is written in today's posting.
Just think logically, while US economy is facing enumerable problems and also probable recession, is able to bottom out, why our markets to lag behind, inspite of good economic growth, and excellent corporate performance, and opportunities for growth exist in India, next to China.
Thus, sooner than latter our markets too should follow global trends. Inflation when it goes up beyond tolerable levels hurts everyone.
I just give an example here: Bank deposit offers 9.5% interest which is taxed at 30% so net return comes 6.65%, and when inflation(latest reported) stays at 6.66% offers negative returns.
Invariably, investors shall realise the same once inflation stabilises above 6% and money flows to Mutual funds and markets, first in to quality blue chip index based stocks, which give the break out in upward direction.
One need to start investing good dividend yielding public sector companies having low P.E. from now on and every dip, since no one can predict exact bottom.
Hope I made the point across, and willing to know your views too, if you think differently, since it will be education for me and readers of the blog too.
bkvrkrao
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