Crude oil prices to move market

Equity markets registered their biggest weekly gains in two months due to dovish commentary of US Fed after the rate hike, appreciation of rupee aga-inst dollar, positive economic data and short covering. However, the Union government’s mid-year economic review which revised GDP growth estimate from the earlier 8-8.1 per cent to 7-7.5 per cent weakened the sentiment on Friday.

The benchmark indices — the Sensex and the Nifty closed higher by 475 points and 152 points at 25,519 and 7,762. The probability of the GST Bill getting passed in the current session of Parliament looks low; and markets will now look out for reforms from the government side. Near term direction of the market will be dictated by parliament proceedings, movement of crude oil prices and global cues. The winter session of Parliament ends on Wednesday. The markets will remain closed on Friday for Christmas.

For the week ahead, chartists predict trading range of 25,000-26,000 and 7,600-7,925. Immediate supports for the indices are at 25,250 and 25,000 and 7,680 and 7,600. Nifty is expected to trade with higher amount of volatility in near term.

It is pertinent to observe that in US markets Dow plummeted nearly 620 points in last two days. Renewed concerns about the impact of rate hike by US Fed and pace of future increases and effect of China slowdown on the global economy have spooked global markets. Analysts expect the markets to end the year on subdued note. There is an old market saying: Down is faster.” Since fear provokes more emotion than greed does, short positions can produce profits (and losses!) faster than long positions.