Amidst hopes that the US Fed is unlikely to raise rates this year, rally in global markets and optimism of finance minister that GDP growth will exceed 7.5 per cent this year; markets rallied strongly during the week ended.
Benchmark indices — the Sensex and the Nifty — gained 859 points and 239 points to close higher at 27,079 and 8,190. Renewed buying from FIIs (after heavy sales during August and September, FIIs have turned net buyers in October so far and pumped in over Rs 2,000 crore already) kept the sentiment positive.
Good market breadth indicates return of investor appetite. Direction of market in the near term will be dictated by Q2 earnings, IIP data, Inflation numbers, FII investment trends and global cues.
This week, many big corporates report earnings. They include Infosys, TCS, Reliance Industries and others, all of which can provide us a glimpse of the financial health of corporate India.
Strong earnings across the board would be a good sign that economy is reviving. Track trends in Bihar elections, movement of rupee against the dollar and crude oil prices. With all the negative US economic data and no change in the global economy, a rate hike at the US Fed’s next meeting in October seems nearly off the table.
For the week ahead chartists predict trading range of 25,600-26,700 for the Sensex and 7,750-8,125 for the Nifty. Immediate supports for the indices are at 25,950 and 25,600 and 7,850 and 7,750.
