The week ahead: uncertainties in US to boost the markets..

With the nifty touching all time high last week, profit booking was seen in almost all the counters. As the trading progressed, the benchmark indices – the Sensex and the Nifty – witnessed more selling pressure and ended the week in red by dropping 228 and 52 points respectively at 29421 and 9106 . This week would be crucial to the markets as the march derivative expiry and negative global cues can keep the indices volatile.

Going ahead, the nifty and the Sensex are witnessing a corrective decline and the negative momentum could continue further as the week progresses. However as long as the indices trade above 8500-9000 and 28500- 29000 levels, we can assume that the bullish undercurrent is on. Should the indices fall beyond these levels, it is a cause of worry.

Much would depend on the macro economic data, global cues , the movement of the rupee against the dollar and crude oil price movement. Indian stocks are highly sensitive t dollar movement. Strong rally in dollar is unlikely in the near future. The muted response to the latest rate hike shows that unless t Fed takes aggressive stand in the case of interest rates by increasing it at a rapid pace, proves the point. In short, the uncertainty in the US will pave way for more boosted trading in the emerging markets, especially India.

For the week ahead, expect a trading range of 29000-29750 for the Sensex and 8900-9200 for the nifty.Volatility is on cards as derivatives expire.

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