Sokhi Market Outlook for 14th July !

True to the predictions, the Union Budget’s failure to meet the expectations of investors triggered a sharp slide in the markets during the week ended. Registering the biggest weekly fall since October 2008, the Sensex on the BSE ended at an eight week low of 13,504, a fall of 1,409 points. The Sensex ended in the negative terrain at 13400, down 104 points, owing to continued selling pressure in select frontliners, gloomy global cues and monsoon worries. A renewed selling from Foreign Institutional Investors and erratic progress of the monsoon kept the market sentiment negative.

Markets ignored positives like inclusive growth triggers in the Budget, IMF’s revised growth forecast for India and better-than- expected IIP numbers. A positive start to first quarter earnings season given by Infosys too failed to enthuse the market players. Parleys at G8 summit in Italty indicate that econom-ies across the globe are “on the cusp of stabilisation” and predict steady revival by 2010.

Star gazers feel that the impact of eclipses on the markets is not ruled out and advice caution during the period. Expect resistance to the indices at 13,780 and 14,140 for the Sensex and 4,130 and 4,260 for the Nifty.

Supports for the week are at 13,300 and 12,840 and 3,920 and 3,780.

Markets are in oversold zone and any positive announcements on policy front which have been ignored in the Budget could trigger hectic short- covering.

Spooked by lack luster Budget, market players were seen ‘cutting’ positions in the derivative segment.

Initiate long positions if the Nifty sustains above 4,100-level on closing basis. Sentiment indicators do not indicate any sharp rebound, but suggest reduced volatility in the near term.

Among the options, 4100, 4000 calls and 3800 put were the most active. The 4000 call accumulated 6.14 lakh shares in open interest, while 4000 put shed open interest. This indicates that Nifty might face strong resistance to cross the psychological 4000 mark.

We recommend our clients to wait and see and be in cash till market consolidate at some levels and wait till Q1 results season for good gains. Accumulate the stocks which displays good Q1 results.

In today markets may rise ahead of global positive cues and short covering may lead to handsome gains in today’s trade. One can go long with trailing stop loss and be cautious as at higher levels profit booking may lead the markets.

Wathc out Axis bank, HDFC bank, PFC , Sintex , India Info and Geojit stocks to buzz today.