Our markets have opened gap down on friday, on weak global cues as anticipated, and traded with volatility as roll overs picked up to next month series. The after noon "Bomb blasts news in Bangalore" during market hours brought more weakness, as longs were unwound, a head of week end and RBI Policy meeting on 29th. Nifty held 4300 level and closed positive for the week posting 5% gains over previous week, thus, posting 3 weeks of consecutive gains. It also closed around June Settlement level (4315.85) and just below the 5DSMA level currently placed at 4324.36. VIX closed at 42.29 on friday, while the day's high again crossing 52.01 intraday, indicates higher volatile times during the coming week where Derivatives Settlement also takes place on 31.07.2008, which incidetally is the last day of the month. Saturday witnessed another serial Bomb Blasts in Ahmedabad in the evening, killing 45 innocents, and injuring many, keeps the sentiments negative for investing in Stocks, which are riskier assets, in these uncertain times.
ICICI Bank announced its Q-1 results on Saturday, which posted 7% net profit down over previous quarter, due to provisions for MTM losses on securities portfolio, as bond yields are raising. NPAs are also up 1.8% of advances, indicates problems with credit portfolio showing uptick. US markets closed with marginal gains on friday night, and crude continues to correct where it touched 122$ intraday and settled at 124$ finally. Since inflation is moderating, and also crude is cooling from 148$ levels RBI may not tinker with interest rates and CRR on tuesday, in my opinion, and watch the growth and monetary situation for few more weeks, as it can act anytime, independent of policy meeting to take proactive measures. Monsoon started picking up in southern india too now, and once the overall monsoon is satisfactory, our domestic economy will look up.
Nifty futures have closed with 18 points premium on friday in the current series. Singapore Nifty futures are currently quoting at 22 points premium which will give flat to positive openig initially. Asian markets are currently trading with gains. Nifty might consolidate in the range of 4200 to 4400 today, due to roll over we might witness two way movement.
Range for the Week: Nifty might trade in the range of 4100 to 4650 during the week.
Strategy for the Day: Buy 4400 puts on rallies for intra day trading.
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