Pre Open Thoughts: Divided and Unsure!!!

Pre Open Thoughts: Divided and Unsure!!!

Ø Multiple pressure points are at work in the markets at the current juncture. The nature of the market is such that no seasonal strategies will work. The street is divided and unsure about how the key indices will behave in the immediate future. On the whole, it looks like the market will remain range bound and choppy without any clear bias. We do not rule out some pick-up in momentum as the day progresses. Much will hinge on how trading in Asia and Europe unfolds.

Ø The Union Budget is another domestic event to look forward to in the coming days apart from the outcome of UP elections.

Ø The start will be soft due to a profit booking which emerged in yesterday’s session. Wall Street suffered overnight while European stocks too were hit. Asian markets are mostly lower as well.

Ø The trading pendulum may swing either way crude is at a nine-month peak while gold is at three-month high. The dollar is at seven-month high vs. the yen. The key indices will go through usual intraday gyrations associated with F&O expiry. For the Nifty, the key level to watch will be 5500 on the downside and 5600 on the higher side.

Ø One should stay on the sidelines for a few days as the key indices may cede more ground. Most traders are watching for the 5500 level on the Nifty in the near term. Whether it re-tests lows of 5000 is anybody's guess. But, if it does one may selectively start dabbling in quality stocks (irrespective of market-caps) for a medium- to long-term.

Ø The Foreign institutional investors(FII’s) continued to be on the buying side with provisional figures for Wednesday stood at Rs 8.29bn in the cash while the Domestic institutional investors (DIIs) were net sellers at Rs 13.32bn, as per the provisional figures released by the NSE.

Results Today: ABB, Aventis Pharma, Gujarat Gas & Ranbaxy Labs

Rollover Snapshot:

CM 3MA 6MA

Mkt Wide 62.57% 61.35% 61.40%

NIFTY 57.83% 59.30% 55.56%

Ø Market Wide rollover picked up well on E-1 day and closed above 3M and 6M averages after remaining below the lines; Nifty rolls were also at par with averages.

Ø On the Sectoral front TEXTILE remained leader followed by SUGAR and Capital goods; Whereas Chem & Fert and REAL ESTATE were laggards.

Ø Stock specific Bharatforg and McLeodruss shown above average rollovers whereas Patni and Bajajhldng were laggards.