"MARKET OUTLOOK FOR 04.02.2011"

The FIIs were net buyers with investment worth Rs 538.71 Cr (prov. cash market fig).
The key benchmark indices edged higher for the second straight day as investors resorted to bargain hunting in beaten down stocks. The next major trigger for the stock market is Union Budget 2011-2012. The government may also announce some populist measures in the Budget given that assembly elections are due in Kerala, Tamil Nadu, West Bengal and Assam. In all these states, the Congress is potentially looking to regain power or to retain it.
Food inflation soared to 17.05% for the week ended 22nd January, rising for the second straight week, on the back of costlier vegetables, fruits and milk. Food inflation rose by 1.48% points from 15.57% in the previous week. The market completely shrugged the inflation data numbers and marched ahead.
The BSE 30-share Sensex was up 358.69 points or 1.98% to 18,449.31. The Sensex gained 375.59 points at the day's high of 18,466.21 in late trade. The index fell 26.01 points at the day's low of 18,064.61 in early trade. The S&P CNX Nifty was up 94.75 points or 1.74% to 5,526.75. The Nifty hit a high of 5,532.65 in late trade. The BSE Mid-Cap index rose 1.09%. The BSE Small-Cap index gained 1.21%. Both these indices underperformed the Sensex.
The market breadth was strong. On BSE, 1,819 shares advanced while 1,073 shares declined and a total of 96 shares remained unchanged. The total turnover on the BSE amounted to Rs 3519 crore lower than Rs 3595.50 crore on Wednesday, 2 February 2011.
VIEWS FROM DIFFERENT BROKING HOUSES::
DANI SECURITIES: "Nifty face resistance around 5560-5600 It may take support around 5440-5370".
DESTIMONEY SECURITIES (SUDIP BANDYOPADHYAY): “Probably we have seen the worst already and the markets are unlike to go below 5400 or above 5700 in a hurry,”
ANGEL BROKING (MILEEN VASUDEO): “Markets opened flat and momentum on the upside gradually picked up as the day progressed, which led the indices to close near days high. On the daily chart, we are observing that the momentum oscillator’s viz., the Stochastic and the RSI are positively poised. This suggests further upside. On the upside, indices are likely to test 18,600-18,660/5,600-5,620 levels in coming trading sessions. On the downside, 18,266-18,217/5,490-5,460 levels may act support for the day. Traders holding on to long position in Nifty (Future) should maintain stop loss of 5,512”.
BONANZA PORTFOLIO (AVINASH GUPTA): “The market may consolidate in a range of 5,300 to 5,600”.
FAIRWEALTH SECURITIES: “In the next session, Nifty is expected to trade in the range 5,484-5,548, sustain beyond the range may decide intraday trend. However, 5616-5646 may be another resistance zone for Nifty. Metals and Oil-Gas may attract buying in the next session while Auto and FMCG may appear weak”.
KARVY STOCK: “The market will take cues from the global markets and is expected to open on a flat to positive note tomorrow. Traders are advised to trade long in Nifty from 5,500 levels for targets of 5,550 and 6,000 levels with a stop loss placed below 5,480 levels”.
CANARA BANK SECURITIES (CANMONEY): “Technically, Nifty exhibited a firm upward momentum in today’s session. After breaching the vital resistance of 5,500 Nifty managed to trade firm, and consolidated the earned gains before closing near day’s high. This is supportive news for buyers. Based on candlestick Charts, in today’s session, Nifty formed a big bullish candle and for its confirmation, tomorrow will be important day to decide any shift in the ongoing trend. Otherwise, Nifty would continue the pattern of higher lows and lower highs, which is a bearish signal. In today’s session, Nifty breached the vital 14 day’s SMA level of 5,611, but closed below its 9, 50 and 100 day’s SMA level placed at 5,569, 5,850 and 5,960 levels; these levels may act as new ranges, in coming sessions. VIX for the day closed at little corrected level of 22.69% and indicating more than average volatility in market in the forthcoming sessions. PCR for the session was recorded at 0.91. RSI (14) for the day was at 36.86 levels and MACD was below the signal line, thus combined together they are giving the signals that market may witness some limited upsurge amidst ranged movement in coming session”.
BONANZA PORTFOLIO (Puneet Kinra): “Nifty showed strength from support near 5,400 levels and closed in green. However, Nifty`s short term trend is still down and it is trading within 5,539-5,402 range for 4 days. If Nifty manages to maintain above 5,550 levels then rally till 5,625-5,650 levels may be seen, else selling pressure may resume”.
“For daily purpose, the trend deciding level is at 5,530-5,550.If Nifty shows strength above 5,550 level, then rally to 5,625/5,700 levels may be seen. If Nifty does not show strength above 5,530 levels then selling till 5,480/5,450/5,400 may also be seen”.
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