Siddarth Bhamre, derivatives analyst at Angel Broking, said, We expect Nifty to be trading between 3100-3150 in the coming days. Nifty futures for January is at around 10-15% premium, and we assume that markets are likely to be volatile.
The 30-share Sensex dipped 1.22% while the broader S&P CNX Nifty of National Stock Exchange (NSE) lost 1.74%, or 51.80 points, to end at 2,916.85 points. Jitendra Panda, head of derivatives at Motilal Oswal Securities, said, We are witnessing a high-level selling in the market and there is some buying at the lower level. Banking and oil sectors are now looking attractive and we might witness some buying in those sectors. However, everything depends on the quarterly results season which starts within a couple of days.
Domestic markets started the day with a negative gap, but during the trading hours gained some momentum on expectation of rate cut and stimulus package by the government. After the Securities and Exchange Board (Sebi) clarified that it had not asked Pyramid Samira to go for an open offer, its stocks price touched the lower level of the circuit filter, and finally declined by Rs 6.10, or 9.98%, and closed the day at Rs 55.05 at the BSE. Barring Bankex, all of the BSE sectoral indices ended the day in the red, with realty, auto and BSE Teck being the worst performers of the day. An analyst from a leading broking house said, Banking stocks gained on short-covering in the markets as investors expected another round of rate cuts by the central bank to shore up a slowing economy.
The market breadth was almost negative as out of 2,509 stocks traded on BSE, only 911 stocks closed in green, 1,505 stocks closed in red and 93 stocks remained unchanged. Among the Sensex pack 25 stocks declined and 5 advanced. Dealers in the market say, This is typical of a bear market where you see such technical rallies. But fundamentally nothing has changed. Long term view looks bleak at this point of time, we will see markets remaining uncertain in the coming days.