The event budget
failed to enthuse the market, as a result market fell sharply by almost 1.25%
in terms of index, but the fall outside the index was catastrophic and stock
fell by 2 – 8%. The internals of the markets were extremely poor, and all this
happened with higher volumes. The budget failed in policy regarding growth.
Government going forward looking to borrow big time from overseas and this
according to us is not a good sign, however some long term rationalisation majors
were taken that could prove good in the long term, the very rich now will be
taxed higher and the middle class by virtue of exemption limit of 5 lakh will
get some relief. More thrust was given on encouraging of electric vehicles and
lot of incentives was given in manufacturing the same. Higher excise duty on
petroleum products and rising custom duty on gold will be look upon negatively.
Although markets failed badly on Friday but still remained within a range
between 11600 and 12000. It has to be seen how the market will behave on Monday
and Tuesday and further course of action will be decided thereon.
Technical– Technically markets in terms of Nifty
looks vulnerable to more fall, trade in close below 11725 will bring down the
market to 11625. As long as markets are above 11600 there is still a hope of
bulls to stage a comeback, however close 11600 would see a extended fall or
protracted corrective action and market could test perhaps 11100 – 11000. Since
the market is crucially poised reversal cannot be totally ruled out, if the
experts after looking to the blue prints of Union Budget and World markets
cues feels that budget may boost the
economy that in terms of levels market may test 12000 initially and a close
above this levels it could test 12400 – 12800 levels.
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