Buoyed by IMD forecast of good monsoon, heartening macroeconomic data and positive global trends; markets were on a high during the week ended. The Sensex and the Nifty vaulted by 953 points and 295 points to close at 25,627 and 7,850 respectively. Renewed buying from FIIs kept the momentum positive.
Market breadth indicates return of risk appetite among market players. For the medium term, structural reforms like Bankruptcy Code and GST are necessary, aver market observers. Earnings of major corporates, macroeconomic data, trend in global markets, FII investment pattern, movement of the rupee against the dollar and international crude oil prices will dictate the near term trend of markets.
For the truncated week ahead, chartists predict trading range of 25,200-26,350 and 7,715-8,050 for the indices. Key supports for the indices are at 25,350 and 25,000 and 7,750 and 7,650. Infosys results have given a positive start to the earnings season. Market response to results will be clinical, adopt stock specific strategy and avoid irrational exuberance.
After a lot of turbulence for last several weeks, emerging markets are making a strong comeback. Factors like prices of commodities stabilising and trending upwards, easing fears over Chinese economic slowdown, dollar beginning to correct against currencies which have weakened last year and expectations that US Fed will not raise interest rates in a hurry have contributed to the recent turnaround in emerging markets. Analysts say that financial markets in the emerging world will continue to perform well this year.