Flat start, bulls hope to outperform!

The difference between performance and outperformance often comes down not to what you buy, but how you buy it. - James Cramer.

The rangebound trade in which the market was stuck for a long time is perhaps history. Suddenly, the all-time peaks of January 2008 appear within striking distance. Even global markets seem to be resilient. A flood of FII money, and stronger than expected domestic economic data have made India among the best performers.



The start today will be flat to slightly down due to lackluster global trends, but the Indian market is expected to recover later in the day. A small pull-back from recent highs is not ruled out. Large caps are likely to remain at the forefront of the rally but lack of participation by small- and mid-caps is a little disconcerting.

There is a lingering sense that a sharp fall could happen, but no one is able to pin it down to any individual event. Shocking bad news from the external front perhaps! However, if global markets remain supportive, the liquidity deluge could take the Indian indices further up. The Fed is likely to maintain status quo but markets will be keen to hear about its future plans. A string of US housing reports are also due this week.

On the whole, the momentum is likely to last a bit longer but one must not get complacent as the market heads further up. One must have a part of one's portfolio in defensive plays like IT, FMCG and Pharma for cushion in case there is a steep fall. Avoid Small-Cap and Mid-Cap shares with questionable fundamentals.

No major local events are scheduled till next week when we will have F&O expiry. A slew of IPOs have hit the primary market, but most of them are relatively smaller ones to cause any damage in terms of absorption of FII inflows.

Watch out for Delta Corp. as its Board takes up a preferential allotment.

Shree Ashtavinayak Cine Vision's Board meets today for the purpose of considering the issue and allotment of equity shares on Conversion of FCCBs. Himalya International's Board has decided to make application for listing the company's securities on the National Stock Exchange (NSE).

FIIs were net buyers of Rs15.18bn in the cash segment on Friday (provisionally), according to the NSE web site. Local funds were net sellers of Rs7.47bn. In the F&O segment, the foreign funds were net buyers at Rs6.2bn. The foreign funds were net buyers of Rs11.43bn in the cash segment on Friday, according to SEBI data. Mutual Funds were net sellers of Rs7.5bn on the same day.