Jitters ahead of Bihar results and fears that adverse result for the BJP-led National DA may potentially derail the government’s reform agenda have pulled down the markets for second consecutive week.
Benchmark indices — the Sensex and the Nifty — fell by 392 points and 112 points to close at 26,265 and 7,954. With Nitish Kumar-led JD(U)’s grand alliance notching up big victory, markets are expected to turn volatile and a knee jerk downward move is expected on Monday.
Expect a phase of recovery after the reaction and consolidation over the Diwali shortened week. Use the defeat in Bihar elections as opportunity to get down to serious policy work and execution of reforms, say industry veterans. Predicting technicals for the week ahead looks very hazardous.
However, savvy chartists suggest that Nifty fall will be restricted to 7,600 level. With Bihar verdict behind us, markets would focus on the macroeconomic data, cues from global markets, FII investment pattern and movement of the rupee against the dollar. The progress of the Goods and Services Tax (GST) Bill and other pending Bills in the winter session of Parliament and reform agenda will hold key for intermediate trend of markets.
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