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Market Report

Thursday, 09-Oct-2014

NSE

  • The S&P BSE Sensex finally closed 390.49 points higher, or +1.49% up, at 26637.28 today and the Nifty ended 117.85 points higher, or +1.50% up, at 7960.55 today to snap its three-day fall, after the US Federal Reserve in its latest policy meet last night reassured investors that the central bank is in no hurry to raise interest rates.

  • Most analysts on the Dalal Street see this more of a pull-back rally from key support levels and the bounce looks very much sustainable considering the fact that cyclicals are now leading the rally. Apart from technical factors, this rally may push the Nifty index to a fresh record high of levels above 8300. The only dampener could come from the outcome of the Assembly election. Otherwise this rally will be led by banks, metal & cap goods, say analysts.

  • Globally, world stock markets roared their approval on Thursday of reassurances the US Federal Reserve will not rush into raising interest rates, with risk appetite flooding back into almost every asset class. The rupee was at 60.96 versus Wednesday's close of 61.39/40 following dovish Fed comments. Almost all Asian currencies were trading stronger versus the dollar.

  • Expect more stock-specific action in markets in next few weeks, says Avinnash Gorakssakar. After yesterday's horrible trading session, today is a big relief. I would like to see the FII flows to get positive. Yesterday we had a big negative number. So as long as the liquidity flows continue to be negative, that would be the only break for this upside. We expect more stock-specific action in the coming few weeks with the earnings season kicking off tomorrow. Everybody will be looking forward to Vishal Sikka's commentary and vision tomorrow and any positive surprise possibly could give a further re-rating, he adds.

  • I believe that the S&P 500 has bottomed out yesterday and that is leading to a bottoming out of all markets, said Ashwani Gujral. Dollar index seems to have topped out for the moment and chances are that we have begun a new upswing. We can make a new high because this low of about 7820 was higher than the previous low. So basically people should reassume long positions because clearly cyclicals are leading this rally, he adds. He is of the view that whenever cyclicals lead the market, generally the moves on the indices are stronger. So it still remains a market that should be bought.

NIFTY 3-Month

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