Follow through gains

You have to have confidence in your ability, and then be tough enough to follow through. -Rosalynn Carter.

The Congress chairperson talked tough and its curtains for the DMK drama. If only some toughness would come on the reform front, the market would be much more happy. For now, the two coalition partners have amicably settled the sticky issue of seat-sharing for the TN assembly polls. All eyes are now on Congress’ negotiations with the Trinamool Congress. We can only hope that the so-called political compulsions in the run up to the state polls won’t hamper policy-making any further.



The markets recovered from Monday’s fall on some hope of political stability. We are set for a positive start owing to better global cues and some softening in crude oil. The political unrest in the Middle-East and its neighbourhood has been a concern for a while now. But markets haven’t quite collapsed. Any relief from the global geopolitical risks will lift equities in the short term and boost risk tolerance yet again.

Other near-term events to watch out for will be the IIP and inflation figures, apart from the mid-quarter RBI review. The Nifty needs to stay above 5520 for a couple of trading sessions in order to make the pullback sustainable. It could well take out the 200 DMA of 5640 in the next few days, provided there is no further bad news. The broader range for the Nifty appears to be between 5400 and 5700 for the time being. In the worst case scenario, the Nifty might re-test its recent intermediate bottom near 5200. On the way up, it may go as high as 5800.

FIIs were net buyers of Rs 2.37bn in the cash segment on Tuesday, according to the provisional NSE data. The domestic institutional institutions were net sellers at Rs 1.4bn on the same day. FIIs were net sellers of Rs 1.27bn in the F&O segment. The foreign funds were net buyers at Rs 27mn in the cash segment on Monday, as per final SEBI data.