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Market Report

Thursday, 11-June-2015

NSE

  • The 30-stock BSE Sensex ended the day at 26,370.98, down 469.52 points, or -1.75%. ?29 of the 30 Sensex stocks closed the day in red, erasing the +1.36% gain yesterday. The broader 50-share Nifty closed below its psychological level of 8000 in a first since October 27, 2014. The index has closed the session at 7,965.35 today, down 159.10 points, or -1.96%.

  • Benchmark share indices failed to extend the previous day's pull back and the Nifty breached 8,000 to end near eight-month closing low amid a sharp sell off in PSU bank shares after the RBI on Thursday said that they would need higher-than-budgeted capital infusion. Experts are of the view that the break below 8,000 levels on Nifty could add to further correction. Next support levels on Nifty are 7,845 and 7,812.

  • Investors are concerned that a weak monsoon may delay further interest rate cuts by the central bank and even make the Narendra Modi-led government take populist measures or at least delay key reforms, including the one on land acquisition that is before Parliament. Adding to the sentiment was UBS on Wednesday reducing its target for the NSE index to 8,400 from 9,200 citing slow pace of growth recovery and monsoon forecasts raising concerns over inflation.

  • Nifty likely to test 7,830 in 2-3 trading sessions, says Mitesh Thacker. Nifty has breached an important low of 8,000. On the downside, we have talked about levels closer to about 7,830-7,850. Looking at the way the market has fallen, this could be tested in the next one-two sessions. We will get a bounce back only after revisiting those levels, he says.

  • Brace for a 400-point correction in Nifty, says Ashwani Gujral. It is possible that 8,000 on Nifty which was acting as a floor till now, becomes the ceiling. Chances are that given the continuation of weak momentum, you will see a lower a opening on Thursday. The downside waves that we are seeing presently are about 800 points. So from 8,470, if Nifty takes a 800-point hit, then it will end trading at around 7,600-7,650 levels. This wave will be completed at around 7,650. We may see a pullback then to about 8,000. That will change the way a lot of stocks look, he says.

NIFTY 3-Month

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