Trekking through the markets
Market ignores the “second wave”, gains led by metals and other commodities.
A strong rally continued in metals, agri commodities and chemicals, leading Nifty above 14500 mark again. The level of activity was very high. Market breadth was strong as small cap stocks materially outperform. Metals and Financials were significant outperformers. Consumers and IT were notable underperformers. Bond yields continue to remain soft, while INR appreciated to end closer to 74/USD mark.
Global market: inflationary risk raises taper tantrum
Global markets witnessed some risk off during last week as inflationary expectations continue to rise and voices started rising in support of tapering of bond buying program. Equities, bonds and precious metals were mostly lower. Copper was a significant gainer; while crude also ended higher. Volatility inched a little higher.
Outlook for the week
The market trend and outlook hs improved marginally in last week. Now the Nifty and Bank Nifty short term (weekly) trend is also neutral vs negative earlier. The near term (daily) trend and outlook also remains “neutral” implying a balanced risk reward. The momentum remains high, indicating a decent probability of change in trend during the week. For this week-
· The day traders may avoid trading in 14380-14515 nifty range, as in this range volatility may be high and stop losses on both sides may get hit. The long positions may be held with a stop loss of 14290 (on closing basis). Non positional short positions may be held with a stop loss of 14745 (on closing basis).
· For Bank Nifty also day Trading may be avoided in 32360-32740 range. For all long position maintain a strict stop loss of 31980 (on closing basis). Non positional short positions may be held with a stop loss of 33115 (on closing basis).
Market trend and outlook
Indian markets last week
Global market performance last week