Infosys results are in line with expectations. Raised rupee guidance for the full year above 100 EPS, the confidence comes from the weakening of rupee. However, the stock fell 7% and brought the tech sector stocks between 5 to 7% with it. The inflation data shown slight uptick in tune with the expectations, where the markets are now agreeing to live with double digit inflation for some months to come, since macroeconomic situation is worsening, domestically and globally too, with crude not agreeing to fall below US $135. The real villain for the steep cut in indices on friday was IIP numbers which were dismal, indicating slowing of the economy, and possibilities for our GDP crossing double digit growth on hold for few years down the line. The capital goods stocks and infrastructure sector have found no buyers, thus the indices gave away most of the gains made during the weak. VIX closed at 33.01. However, both Nifty and Sensex have posted week on week gains after continuous fall for 7 weeks in a row. Now How they move this week and close on coming friday, shall give the clue for reversal of trend and at least intermediate bottom formation!
US markets closed in negative territory on friday, Singapore Nifty futures are currently quoting with 30 points discount, asian markets opened positive and are trading in negative territory, as crude shoots to US 145$ once again. UPA government trust vote is scheduled on 22.07.2008, for which a special session is convened for 2 days on 21st and 22nd instant. Our indices have closed above June month closings on friday, where as they will face first resistance at 5DSMA levels currently placed at 4077.37(Nifty) & 13647.20(Sensex) now on any upmove.
Range for the Week: Nifty might trade in the range of 3800 to 4200.
Strategy for the Day: Buy Straddle of 4000 for intraday trading today.
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