NSG clears the Indo-Nuclear deal by consensus shall boost sentiment of our markets today!

Last week saw a volatile market, finally closing flat in the end on week on week basis. The inflation holding sub 12.5% levels, and the week end historic decision by NSG group to allow India to use the Nuclear technology, supply etc., unanimously, ends the 34 year embargo on our country's access to fuel and latest technology for civil purposes too. This paves way for US congress to consider the Indo-US nuclear deal during this month's congress session itslef, and might clear the process to initiate the process for transfer of technology to India will solve long term power requirements of the country to some extent. Though, critics argue that the 123 agreement and Hyde Act, have some clauses which might zeopardise our country's interest anytime, if testing is done or whether the fuel and technology is diverted to other than civil purposes, generally believed, military purposes.

However, the Government of India is sincerely committed to self proclaimed non-proliferation, and its policy not to 'first use' in any agression too, will not pose any threat to continuous seeking of the technology transfer and future in the years to come. It is a clear victory for Dr.Manmohan Singh, Prime Minister of India who has put his complete weight behind achieving it, inspite of strong opposition from left and some of his men too, though privately; US markets have closed flat to marginally positive on friday, as the two troubled mortgage lending institutions are being bailed out by US Government, was welcome news for the investors there. US futures indicate huge gap up opening to night(IST), will certainly induce asian and european markets to rally today. Crude is hovering below 107$ and might bounce once it touches psychological level of 100$, in case of weakenig further.

VIX has closed at 32.65 on friday. Singapore Nifty futures are currently quoting at a whopping premium of 202 points gives a thumping opening for our markets, but profit booking in the band of 4500 to 4550 can be expected, as corporates plan for advance tax payments by 15.09.2008. Technically Nifty finds support at 4320 for the day on any weakness and shall face strong resistance at 4555 (100 DSMA). Stocks relating to power sector, and capital goods sector shall rally from now on.

Range for the Week: Nifty might move in the range of 4300 to 4600 during the week.

Strategy for the Day: Buy 4550 puts on rallies for intra day trading.