Let us briefly examine what was happened last week and what will be the expectation for the coming week.
Indian equities on Friday mirrored the fall in the global markets which were gripped by fears of a double dip-recession in the US and a funds crunch in the Euro zone.
In intraday trade, Sensex moved down 700 points while the Nifty fell by 205 points. At close, however, NSE had lost 120.55 points or 2.26 percent to close at 5211.25 while BSE lost 2.19 percent or 387.31 points to end at 17,305.87.
All indices on the BSE and NSE fell sharply and the only saving grace was the V shaped intraday recovery for the Sensex and the Nifty.
FIIs sold equities for a net of Rs.1788.96 crore on Friday. But DIIs were on the buying side. They bought equities for a net of Rs.1372.49 crore. Retail investors are also on the buying side. They purchased equities worth Rs.146.1 crore.
Stocks that LOST:
- IT Stocks (TCS, HCL Tech, Infosys, Wipro), on uncertainties about the global outlook.
- Commodity stocks (RIL, Tata steel, Sterlite ind. etc), on weaker price outlook.
- Small caps (Dhanlaxmi Bank, Everonn etc) on profit taking.
Stocks that GAINED:
- Oil marketing stocks (BPCL, IOC, HPCL etc) on falling oil prices.
- Pharma stocks on defensive theme
- PSU banks (Cnara, Union Bank) on Value buying.
I think the negative news coming from the world economy especially from the US market and European markets definitely affect Indian markets also in the coming week.
Since the major key players in the market are FIIs, we have to watch whether they are on the buying side or selling side.
In the past week FIIs was totally on the selling side. But since the retail investors and DIIs are on the buying side the market maintained the crucial 5200 support Zone. This is a positive note.
I believe that markets are behaving like News driven market rather than Technical driven.
So retail investors should watch the behavior of FIIs and DIIs. Also the coming week's market will depend on the various news coming from the world economy. So observe the news also.
The major support zone of Nifty in the coming week will be 4930-4980. Watch this level carefully. If market stabilize in this level, we can expect a positive trend. But if Nifty loses that support, then market will drift further. We can expect a positive trend only when Nifty break the 5370 resistance level.
So make intelligent decisions by watching the world market news and observing the crucial support zone of Nifty.
Regards Hari " लोका समस्ता सुखिनो भवन्तु "
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