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Two straight sessions of gains, which helped the National Stock Exchange's 50-share Nifty to end above the 5450-mark, and recovery in the rupee. Yesterday, make most market participants view the market with a positive bias for the next week. However, further movement in the rupee and overseas cues will continue to lend direction to the market. Yesterday's gain in the rupee is the highest in a single session in the last four years, with which the currency has also broken its six-day losing streak. With the August derivatives contract expiring on Thursday, volatility in the market is likely to continue. Several market participants expect the Nifty to trade above the 5500-level, with a few also expecting the Nifty to breach the 5600-level on the back of a strong rupee.
Markets have pulled back on increasing optimism that the rupee has reached the bottom and may not fall from these levels. Finance Minister P. Chidambaram's statement that all options were on the table to protect the rupee, will improve sentiment. Market has given a very strong reversal pattern on the daily charts. We see the Nifty heading up to 5650-5700 level. Most market participants expect stocks in the automobile, capital goods, banking and metal sectors to extend gains next week. We expect Bank Nifty to head up to 9800 level. However, some stocks may weaken due to the fine imposed by the Reserve Bank of India for violation of know-your-customer and anti-money laundering norms. These include Allahabad Bank, Bank of Maharashtra, Corporation Bank, Dena Bank, IDBI Bank and Indian Bank.
Telecommunication stocks may be in focus as the Telecom Regulatory Authority of India will hold an open house discussion on valuation and reserve price of spectrum with stakeholders on Aug 26. We see no further downside for the metal sector for the entire year. Metal stocks have been among the major gainers this week helped by positive manufacturing data from China for August. Metal stocks have been through their worst phase and bottomed out. If the metal stocks do see a dip in the near term, one should take that opportunity for buying the stocks. Hindalco Industries is his top pick among the metal and mining pack and sees a 15-20% upside to the stock in the near term.
Two straight sessions of gains, which helped the National Stock Exchange's 50-share Nifty to end above the 5450-mark, and recovery in the rupee. Yesterday, make most market participants view the market with a positive bias for the next week. However, further movement in the rupee and overseas cues will continue to lend direction to the market. Yesterday's gain in the rupee is the highest in a single session in the last four years, with which the currency has also broken its six-day losing streak. With the August derivatives contract expiring on Thursday, volatility in the market is likely to continue. Several market participants expect the Nifty to trade above the 5500-level, with a few also expecting the Nifty to breach the 5600-level on the back of a strong rupee.
Markets have pulled back on increasing optimism that the rupee has reached the bottom and may not fall from these levels. Finance Minister P. Chidambaram's statement that all options were on the table to protect the rupee, will improve sentiment. Market has given a very strong reversal pattern on the daily charts. We see the Nifty heading up to 5650-5700 level. Most market participants expect stocks in the automobile, capital goods, banking and metal sectors to extend gains next week. We expect Bank Nifty to head up to 9800 level. However, some stocks may weaken due to the fine imposed by the Reserve Bank of India for violation of know-your-customer and anti-money laundering norms. These include Allahabad Bank, Bank of Maharashtra, Corporation Bank, Dena Bank, IDBI Bank and Indian Bank.
Telecommunication stocks may be in focus as the Telecom Regulatory Authority of India will hold an open house discussion on valuation and reserve price of spectrum with stakeholders on Aug 26. We see no further downside for the metal sector for the entire year. Metal stocks have been among the major gainers this week helped by positive manufacturing data from China for August. Metal stocks have been through their worst phase and bottomed out. If the metal stocks do see a dip in the near term, one should take that opportunity for buying the stocks. Hindalco Industries is his top pick among the metal and mining pack and sees a 15-20% upside to the stock in the near term.
