Markets kicked off the week on a strong note, boosted by stock specific buying, indices shot ahead in the days trade and closed with handy gains. Good buying was seen in bank, capital goods, pharma and realty stocks. Select oil & gas, auto and IT stocks were under pressure. Nifty closed at 4,474 up 10 points, while Sensex shut shop at 15,422 up 103 points.
The market sentiment has improved quiet a bit particularity after the release of GDP data, which were better than expectations. "There is some sense of stability so we think that market would remain in a range for the next few days atleast by 15th September or so. We think that the market would be in a broad range of let’s say about 15,000 to about 16,000 odd levels.
I feels that there are no major fears now and the rollovers have become a bit of a non-event. There is some amount of volatility but it never last and overall impact on the market is not as much as players make it out to be. The recovery has been pretty fantastic for our markets. Clearly, we have outperformed our peer group over the past few trading sessions. But the bigger question is whether we can scale to a new high, higher than what we touched in the last week of July".
I feels that although there is a good amount of recovery in the Sensex stocks, going forward, there is not much of follow-up buying coming in around 16,000 levels. As of now also there is not enough clarity on the kind of turmoil, which is there in the global markets. We still are vulnerable to sell-offs, which takes place in the global markets. I think as of now it is fair to assume that market is in a kind of a range, where the previous top of about 15,868 would be difficult to cross and the bottom which was created below 14,000 has a good support level.
On how to approach a market like this, experts say it is a bit of a buy at decline kind of a market and selective at the same time because there is still scope for sharp corrections, retracement to take place depending upon the global cues. Experts believe that it is important to have some amount of cash in your portfolio as well because opportunities will be there going forward. Especially with the earnings season happening in October, there will be some more opportunity depending upon the way the news flows from the corporates.
The market looks good technically. He is concerned with the happenings in the US. Despite Bush and Bernanke's encouraging remarks, I don’t think we have seen the end of the credit crisis. We have definitely not put the credit crisis behind us..
I expect to see selling at higher levels and would remain cautious at these levels.On asked how he would approach the market now and whether he would buy or start profit booking he said, “I would do a little bit of that definitely, profit booking in the next 200-300 points rally should be looked at and perhaps we will cross the previous high because we have moved up so quickly and so easily from the lows without any real retail participation.
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