Caution should be maintained

After posting significant gains of over 650 points in the last two sessions, buying interest may continue on the back of a firm trend. However, caution should be maintained as high intra-day volatility and subdued Asian markets in current trades may dampen the investor sentiment. Most of the Asian indices have slipped from their levels and currently are marginally up. Among the key local indices, the Nifty could test higher levels at 4300 while it has a support at 4250. The Sensex has a likely support at 14200 and may face resistance at 15100.

Major US indices slipped Monday after a disappointing existing home sales report revived worries about the mortgage and credit markets. While the Dow Jones slipped by 57 points at 13322, the Nasdaq moved down by 15 points to close at 2561.

Except few, most of the Indian ADRs slipped on US bourses. ICICI Bank led the pack with gains of 3.56% while Satyam, Wipro, Dr Reddy's and Patni Computer gained over 1-2% each. Among the laggards Infosys, Tata Motors, HDFC Bank., VSNL, MTNL and Rediff fell around 0.5-1% each.

Crude oil prices advanced further, with the Nymex light crude oil for October delivery gaining by 88 cents to close at $71.97 a barrel. In the commodity space, the Comex gold for December delivery slipped $1.30 to settle at $676.20 an ounce.