Huge gap up till 4500 levels nifty and 14700 sensex
A whole host of companies that will benefit from the Indo-US nuclear deal will see some positive action today. These include the likes of L&T, HCC, BHEL, NTPC, Tata Power, Reliance Power, Areva T&D, Alstom Projects, Siemens and ABB. The ADAG group shares may also extend their recent gains. Sesa Goa is likely to rise after announcing strong results.
We will also have the F&O expiry next week, which could make the market volatile. On the whole though, we are in for a short-term rebound, which could take the Nifty up a few hundred points. But, one must not get carried away and start buying aggressively.
The improvement in the mood may last for a few more days, provided oil prices retreat further, global markets hold and inflation cools down. On the flip side, the market could turn lower again on any fresh negative news. One must add here that the last four days of rally has been driven mainly by short-covering by bears. Also, FIIs have turned net sellers again in the last two days after pumping over Rs10bn in the two days of last week. The monsoon has been quite bad over western and southern parts of the country. This could spoil the party for the Government and the markets