| The Indian markets took a breather in the last week and fell after a couple of weeks rally. The market started the week with a weak undertone and continued to observe selling pressure throughout the week. On the second day, however, both indices pared their losses on strong global cues.
On a week-on-week basis, the BSE Sensex lost 492 points or 2.9% to close at 16642.66. The S&P CNX Nifty on the other hand finished the week at 4945.2, down by 138 points or 2.7%. During the past week, two major events remained favourable for the market viz. Reliance Industry's 1:1 bonus share issue and better than expected results by Infosys. However, both these events failed to boost market sentiments enough to post gains. Global markets, however, remained positive during the past week. | |
| Last week's downfall in the Indian markets has been important given the fact that most of the global markets actually posted gains during the same time. So, the question which arises here is whether the Indian market has finally started seeing much anticipated downward correction. It may be very early to conclude that, as last week's fall may be a result of simple profit booking before Diwali celebrations on the coming weekend. However, the important thing is, after testing some psychological levels by the market, participants have also become very cautious. Most participants do not want to hold their positions at these levels. Thus, it has become more of a trading market. At this point, the 4900 mark for the Nifty would be an important level to watch out for. A break of this strong support level should put further pressure on the market sentiments. Meanwhile, the coming week is also going to be a holiday shortened week, due to elections. The market on the very first day would wait for the August IIP data, which is expected to show a growth of 9.2% YoY. A shortfall on this expectation may weigh on the market sentiment again. Volume, on the other hand, is likely to remain light in the coming week. |
