Indo-Nuke Deal cleared by 2/3rds majority by US Congress! 250$ Billion bail out package finalised by US govt!

Friday, our markets experienced selling pressure, due to week end consideration, and uncertainity on the proposed bail out package of 750$ Billion by US authorities to avoid crisis in financial system, though US markets posted gains on thursday. Nifty breached 4000 mark quite efortlessly and closed below it too on weekly basis, indicating the bearishness, and weak sentiment. Investors stayed away, where as FIIs pressed sales in spite of lower prices, as rupee continues to be weakening against US dollar, which is a double whammy for them in Sept '08 throughout. Well the good news came on the week end, in the form of US congress clearing Indo-Nuke deal, dropping clause and reference to Iran, on strong insistence of Indian authorities, with a 2/3rds vote ends the '34 years of nuclear apartheid of India among global arena'. The bill is to be cleared by US senate, which shall be a formality, since the senate committee cleared with 19-2 vote already. The deal might be signed on 3rd as reports stand now, is a clear positive news for power sector, capital goods sector and manfucaturing sector too. The other suspense on the bail out package of 750$ billion also is discussed and now finalised first tranche to be 250$ keeping another 100$ billion at the disposal of President, to meet any contingency is also welcome news for rate sensitives in US and world over. Friday night US markets though traded in negative territory finally posted gains.

VIX has closed at 33.96 and Singapore Nifty futures are currently quoting at a premium of 36 points should give positive opening initially for our markets. Nifty will face initial resistance at 4040 and 4100 later today. August closing of Nifty was at 4360, which is a tall order at this point for nifty to climb and close above it in two days left for the month. However, 4040.55 being June quarter closing should be conquered on closing basis tomorrow, to save the quarterly charts in tact, for some solace next quarter, as we move into Q-2 results season and 'Diwali' during October' 2008. 30th September is a non-banking holiday on account of Half yearly closing of Accounts by banks in India, and 02nd October 2008, is a trading holiday on account of 'Gandhi Jayanthi' makes this a truncated week, thus markets will be confined to a narrow range.

Range for the Week: Nifty might trade in the range of 3800 to 4200 during this week.

Strategy for the Day: Buy Nifty futures at the opening with a stoploss of 50 points below the purhcase price for intra day gains, if one is a high risk trader.