Next bounce unlikely before Dec
Major trigger will be results of Assembly elections in 5 States on Dec 3
image for illustrative purpose
What’s In Store?
• Elections in 5 States will be held in Nov
• Results would be declared on Dec 3
• Oil price surge may spoil the mkt mood
• NSE Nifty closed at 19,281.75 pts on Monday
• On positive terrain, Nifty may cross 19,800-850 level
• However, the 20,200 level seems a distant dream in immediate future
New Delhi: Until last week it appeared that the current festive season of Dussehra and Diwali would see the markets touching new highs and moving up even higher. A week later, with the Israel-Hamas fighting intensifying, these hopes lie shattered.
The entire issue seems to have got delayed and may get pushed even further. Elections in five States would be held in November and the results would be declared on December 3. This would cause some ripples in the markets as the ruling party in many of these states is not the government at the Centre.
India appeared to be one shining example of a market which was doing well as the economy was firing on virtually all cylinders. The joker in the pack was the way oil prices had again raised their ugly head and seemed all set to cross the three-digit mark. With a conflict on, and oil hitting India, the rupee too was under pressure and hurting the economy.
All these factors do not augur well for the country, its economy and the markets. In such a scenario, the feel-good factor in the markets too has taken a beating and affected the technical set-up of the markets.
NSE Nifty closed at 19,281.75 points, 260.90 points or 1.34 per cent lower, on last Monday. What at one time looked like all was going well and we would cross 19,800-850 on Nifty and then move on to 20,200 points seems a distant dream in the immediate future.
The near-term outlook also seems to have gotten a bit murky. We may take time to form a bottom and recover from there. This could take us closer to the 19,000-19,050 levels or in a worst-case scenario to 18,800 levels.
From there the rally would become that much steeper and tougher. Further, the political scenario pre-elections is always a time when investors are a bit wary of the markets.
As it is, the FPIs seem to be a little cautious in India and have been net sellers over the last few months. What could change their view is just that markets have become cheaper or as a destination we are better than the rest.
