Amid stock specific moves, markets ended the week on a robust
note, perhaps, one of the best weekly close from quite some time, with gains of
almost 3 percent. However, none of the sector acquired leadership and it was
all very stock specific. On the macro front, crude prices appear to be
stabilising around these levels and global equity markets have also managed to
regain some ground. Markets are still in a jittery mode, with lot of events
lined up like the Union budget, policy reform implementation, US data,
geo-political scenarios, oil demands, and Chinese market recovery are some of
the factors markets will watch very closely. Since the undertone for the market
is bearish, any bad news will crash down the markets and good news flows would
help the market to sustain the existing levels, and in that case, markets would
at best remain range bound. It appears that only in the third and the fourth
quarter will the market firm up, and will be susceptible to falls.
Technically too, market looks weak and vulnerable, though
7000 on the Nifty offers a good support, a close below this level, markets
would witness a renewed selling and perhaps would test 6650 levels. On the
higher side, markets in terms of Nifty would face stiff resistances between
7300 and 7500. Though a test of 7500 on the Nifty is not ruled out, but all
this would be a throwback rally on the backdrop of mighty fall. The short term
range one would look out for is between 7000 and 7400, and the markets are
exactly on the median point.
Investors should show some courage and exit from
fundamentally and technically weak stocks in rallies even if one is incurring
some losses, and at the same time shift into fundamentally strong stocks with
good management and that are more domestic led. This is a good portfolio
restructuring time.
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