MARKET VIEW FOR 30TH SEPTEMBER 2011

AFTER CONSOLIDATING FOR A DAY INDIAN MARKETS RESUMED THE DECENT SHORT COVERING RALLY IN A VOLATILE SESSION ON F&O EXPIRY. NIFTY SHUT SHOP AT 5015.45, UP 69.55 AND SENSEX ENDED AT 16698.07, UP 252.05. MARKET BREADTH WAS  ---- AND BOTH BSE MID-CAP & SMALL-CAP INDICES WERE ---- BY LESS THAN 1%. ANALYSTS SAID  THE TRADING  SENTIMENT WAS BOLSTERED BY FIRM ASIAN TREND AND REBOUND IN THE EUROPEAN MARKETS ON HOPES THAT GERMAN LAW MAKERS WILL APPROVE FUNDS FOR BAILOUT OF EUROPE’S DEBT-LADEN NATIONS. BUYING WAS SO STRONG THAT A SURGE IN FOOD INFLATION FAILED TO DAMPEN THE MARKET SENTIMENT. FOOD INFLATION ROSE 9.13% FOR WEEK ENDED SEPTEMBER 17, 2011 FROM 8.84% IN THE PREVIOUS WEEK. INVESTORS WERE SEEN COVERING PENDING POSITIONS ON THE LAST DAY OF SEPTEMBER’S SETTLEMENT IN THE DERIVATIVES SEGMENT, WHICH ALSO FUELLED THE BUYING ACTIVITY.

GOING FORWARD INDIAN MARKETS WILL BE GUIDED MAINLY BY GLOBAL CUES AS THERE REMAINS NO NEAR TERM TRIGGERS DOMESTICALLY. THE BROAD RANGE FOR THE NIFTY SHALL BE 5170 TO 4750. BREAK ON EITHER SIDE SHALL BRING AT LEAST 300 POINTS MOVE. OVERALL THE SENTIMENT REMAINS CAUTIOUS AND LACKS CONVICTION.

FOR TODAY THE KEY LEVEL TO WATCH FOR IS 5020 & 5050, ABOVE WHICH 5110 AND 5170 REMAINS THE TARGET. IF NIFTY SUSTAINS BELOW 5000 THEN NIFTY 4940-4900 SHALL BE THE STRNG SUPPORTS, BELOW WHICH 4750 OR BELOW COULD BE TESTED.

HENCE 4900-5050 REMAINS NO TRADING ZONE. TRADE IN OPTIONS ONLY WHEN THESE LEVELS ARE BROKEN ON EITHER SIDE.

ANALYSTS BELIEVE THAT NIFTY MIGHT APPROACH 5110-5170 LEVELS, FROM WHERE IT HAS REVERTED TWO TIMES. BUYING OF PUTS OF OCTOBER SERIES IS SUGGESTED BY ANALYSTS ONLY WHEN NIFTY REACHES NEAR RESISTANCE LEVEL OR BREAKS THE STRONG SUPPORT OF 4900. BUYING OF NIFTY CALLS OR PUTS IN THE RANGE OF 4900-5050 MAY RESULT IN LOSSES DUE TO EROSION IN VALUE DUE TO RANGE BOUND MOVE FOR A WEEK OR TWO.

NOTE THAT ANALYSTS HAVE REGULARLY SUGGESTED THAT BUYING IN SELECT STOCK AT EVERY LEVELS SHOULD BE DONE, HOWEVER AS THERE REMAINS CLOUD OF UNCERTAINITY INVESTORS ARE WAITING FOR A DEEP CUT AND CORRECTION. HOEVER IT MAY OR MAY NOT COME. NIFTY MAY TEST 4500 OR MAY NOT HENCE IT IS ADVISABLE TO KEEP PICKING SELECT STOCKS.

TO ME IT SEEMS NIFTY SHALL SOONER OR LATER TEST RECENT LOWS AND MAY GO BELOW THAT. BUT ONE CAN START BUYING SELECT STOCKS ON EVERY FALL.

ASTROLOGICALLY: MARKETS WILL REMIAN SUBDUED TODAY, AND THERE WILL BE  A RANGE BOUND MOVE.

Safe Harbor Statement:
Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints.Nothing in this article is, or should be construed as, investment advice.

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