Market may remain cautious

Today finance minister will unfold the budget and expectations are it will be a populist budget. Rumors are that FM is unlikely to announce any big changes in the direct tax structure.The market is likely to remain under pressure following an overnight fall in the US indices and weakness in the Asian markets in ongoing trades. Among the key local indices, the Nifty has a key support at 3880 and a slip below this level could see it test lower levels around 3840, while on the upside the index could test 3980. The Sensex has a likely support at 13400 and may face resistance at 13600.

U.S. stocks fell sharply in on Tuesday after Chinese stocks suffered their worst one-day sell-off coupled with a weak U.S. economic report concerns about a slowdown in global growth. While the Dow Jones tumbled 416 points at 12216, the Nasdaq dropped 97 points to close at 2408.

All the Indian ADRs were battered on the US bourses. ICICI Bank led the slump and crashed over 10% while VSNL and Rediff tumbled over 7-8% each. Infosys, Wipro, Satyam, ICICI Bank, HDFC Bank, MTNL, Tata Motors and Dr Reddy's slumped 3-6% each.

Crude oil prices edged higher, with the Nymex light crude oil for April delivery moving up by 11 cents at $61.39 a barrel.