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Friday, February 24, 2012

indian stock market nifty outlook week feb 27- march 2 2012

indian stock market nifty outlook week feb 27- march 2 2012 : Indian shares closed lower for a third straight day Friday, led by financial stocks after Citigroup sold its stake in Housing Development Finance, and as investors remained cautious ahead of crucial policy announcements scheduled over the next few weeks.

The Bombay Stock Exchange's Sensitive Index declined 0.9% to end at 17,923.57. The benchmark had closed near a seven-month high Tuesday and is down 2.7% since. On the National Stock Exchange, the 50-stock S&P CNX Nifty dropped 1.0% to close at 5,429.30.

Trading volume in the BSE's cash segment dropped to 28.41 billion rupees from Thursday's 31.71 billion rupees. Decliners outnumbered gainers 1,811 to 1,089, while 128 stocks were unchanged.

The benchmark indices registered their first weekly fall in eight weeks in 2012. The 50-share Nifty index slipped over 2% during this week.

"Indian markets closed below their key support levels of 5450 on the Nifty and 18,000 on the Sensex. Looking at the chart patterns, markets are expected to see further lower levels next week," said Rakesh Gandhi, Sr Technical Analyst at LKP Securities Ltd.

"However, from the current close of 5430 on the Nifty, next important level that could now act as major support for the index is 5400 and if that is broken, there could be sharp downward move thereafter," added Rakesh.

He added, the correction that has started after a strong rally in the last 8-9 weeks should be used by investors as buying opportunity.

The broader 50-share NSE index closed 0.98 percent lower at 5,429.30. The broader index touched a high of 5521.40 and a low of 5405.90 in trade today.

We have compiled recommendations of expert market voices on important market levels to watch out for:

Kunal Bothra, SeniorTechnical Analyst, Manager Advisory, LKP Securities:
The short term charts indicate that Nifty is on a path of retracement. From the start of this rally, a simple 23% Fibonnaci retracement falls at 5370 levels, which makes the band of 5350 and 5450 a crucial one.

Ideally a sharp rally in a short span like in the last 7 weeks warrants a consolidation. A time and price consolidation could be something which can grind the markets for the next week.

Ambareesh Baliga, COO, Way2Wealth Brokers
"After a 1000 point rally in just about 6-7 weeks, we required a correction and that too a steep one. And this is exactly what is happening right now and it will continue for a little while longer," said Ambareesh Baliga, COO, Way2Wealth Brokers Pvt Ltd.

"We had earlier suggested 'sell' at every rise and if case there is a small bounce back, utilise it to exit and wait for levels of say 5200-5225 on the Nifty," added Anbareesh.

Mitesh Thacker of miteshthacker. com
Broadly looking at the charts we see support coming at 5350 or 5320 range on the Nifty. Markets are correcting, which means that it might go into some consolidation mode for sometime before moving up. If the market dips below 5400, the opportunity should be used to buy into stocks which are showing good strength on the intraday as well on daily charts.

CK Narayan:
The fall in Nifty was largely led by banks and most of the big banking names came under a bit of a pressure today. If the Bank Nifty were to trade down below 10600, it would probably trigger a sell and that would exert a further pressure on the Nifty.

Being a weekend traders seem to be on a bit of a holiday mood and right since the morning, they have not really had too much of success going long. So, there is a lack of willingness to go long in this market which might actually see it slide down.

Devang Mehta, VP & Head Equities Sales, Anand Rathi Securities:

If we observe the fall in the markets very closely, we will see the stocks which rose the most have now corrected and the banking space was one of the prime runners in the so-called rally of 1000 points.

So going forward I will not rule out a correction in the banking space, though would be very stock specific. Overall, the sentiment in the market is good. However, if Nifty corrects to levels say around 5300-5350, it would be a net active level for people to start investing again in select stocks.

Ambareesh Baliga, COO, Way2Wealth Brokers Pvt. Ltd
The event risk of upcoming election results, monetary policy and Union budget in March is largely there in the markets. Hence, a lot of volatility is expected around that time. However, closer to levels of about 5200-5225, one should start nibbling in the stocks.

However, I do not rule out the possibility that we could see even levels of 5000. So closer to 5000 levels, get invested as much as possible.

S Naren, CIO-Equity, ICICI Prudential AMC
Over the last three years, India has not been able address issues of inflation and fiscal deficits. If we are able to address problems of rising inflation and ballooning fiscal deficits, India is a structural long-term story and we can see new highs.

But the point is at this point of time with crude at $121 and oil subsidies shooting up, does it look like the market will touch new highs? The answer is no. But if we have solid reforms, we may go through a period of pain in the economy, but we can see new highs in the market.

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