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Market Report

Wednesday, 03-Apr-2013

NSE

  • The Sensex dropped 239.31 points, or -1.26 per cent to 18,801.64 today. It had touched the day's low of 18,721.72. The index had gained 360 points in last four trading sessions. Similarly, the broad-based National Stock Exchange index Nifty plunged 75.20 points, or -1.31 per cent, to close at 5,672.90 today, after falling to 5,650.10 in intraday.

  • Markets fell sharply today, posting its biggest fall in two weeks as political uncertainty took center stage. BJP's senior-most leader LK Advani said that Lok Sabha elections could be held earlier than scheduled, even this year, according to media reports. This led to a sell-off. Brokers said the market has been lacking any positive trigger while reports of lower quarterly earnings by companies in the fourth quarter sparked capital outflow.

  • Continued political uncertainty and negative FII flows flared fresh worries in the mind of investors, say analysts. The next critical level to watch out for is 5630 and 5600 and if markets fail to hold onto 5600, further downside is expected.

  • The sentiment further dampened on weak trend in Asia and lower opening in Europe as investors await reports on US employment and services industries, traders added. However, Japan's Nikkei average jumped 3%, its biggest one-day rise in almost two months, on growing expectations that the central bank will announce further easing steps on Thursday.

  • What will really make me nervous is a break below 5630 on the Nifty, says Mitesh Thacker. Having said that, 5630 is an important level as 200-day average is placed around that levels. In fact the last time when the markets fell, we had two daily closing around 5635 to about 5640. So if those levels start getting violated, then I would be looking at much lower levels and possibility of 5550 would immediately come into play, he added.

  • The crucial level of 5600 has held so far, but a breach of the same could lead to further downside all the way up to 5550 followed by 5450 in the short term, said Vinit Pagaria of Microsec Capital Ltd. On the flip side, if Nifty holds on to 5600, it is likely to move in the 5600-5800 range for the next couple of weeks. The upside resistance levels would be 5715 and 5750, he added.

  • We still need some major positive news flow to get us out of the woods because this pullback rally of sorts is losing steam, says Prakash Diwan in an interview with ET Now. Additionally, the net selling numbers from the FII side is negative whereas the DI has turned positive after a while. If this continues, then it could be a turning point of sorts, he added.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)