Well August series settlement is behind us. US markets rallied overnight on the strengthening of dollar, as jobless claims data showed down tick, and crude cooled from 120$ levels to 114$ intraday finally closing at 115$. Asian markets are trading with gains and Singapore Nifty futures are currently quoting at 67 points premium, shall augur well for our markets at the opening. Market wide rollover was 80% where as Nifty roll over was 68% only being the lowest in 2008. Thus, scope for long build up in the new series will be there at the beginning of series, as Nifty futures too closed at a premium of 9 points yesterday. Howver, the mute point is upto what extent the indices especially Nifty can recover the losses of yesterday and this week are to be watched carefully, for signs of trend reversal, since the indices have closed at the lowest point of August month on pernultimate day.
In my view, 4200 on Nifty and 14000 on Sensex, would hold today and a relief rally can be expected, which will face resistance and supply from trapped investors as the sentiment too pessimistic for equities, which is evident from high intraday volatility. Higher volatility is some times a sign of bottoming out or topping out of indices. This time around since we are long term down trend with interemediate trend on assault, by bears, I feel that there shall be a bounce today, which anyone can guess and closing above July closing levels Nifty(4332.95) & Sensex(14355.75) today, will strengthen the bulls to push further next week. Some fund buying also can be expected today to prop up NAVs too. September is generally good month for equities in general as the Q2 results will be priced in, tech sector should do well since dollar is strengthening.
Insurance Regulatory Authority has revised the premium tarriff down wards on long term insurance policies, which in some cases result in fall of premium by 40% is good news in the hands of policy holders, who can buy higher insurance for the same amount of premia they were paying, or they will be left with some cash in their hands, which also encourages them to look at other avenues.
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