Market View - Small Bull Run Can Start

The bulls may have regained some lost ground with bears covering their shorts in the last couple of days. Global markets too have big held up quite well and oil prices have retreated a bit. Lack of fresh bad news coupled with buying by local institutions have kept the bears on the defensive in the last two days. FIIs turned net buyers in the cash segment yesterday. However, it remains to be seen whether the current momentum can be sustained, as the bulls still lack conviction.

Mutual funds may be sitting on a huge pile of cash, but the market needs FIIs to turn net buyers in a big way. In short the FIIs have to light the fuse to ignite positive action in the Indian bourses. Plus, the macro and micro environments have to change drastically. The flow of bad news has to slow down. All this will take a while to materialise. As a result, the market will remain largely rangebound and choppy with alternate bouts of buying and selling. It’s a no brainer that this outlook is subject to global market conditions and improvement in local fundamentals.

Today, we expect another cautious to slightly positive start, as the US indices fell overnight but most Asian markets are on a firm ground. The overall trend could slightly favour the bulls purely due to the current momentum though there may be some cooling at higher levels.

Results Today: Aurobindo Pharma, Dish TV, Era Infra, Finolex Industries, Greenply, Hotel Leela, Indraprastha Gas, Kei Industries, Marg, Mascon Global, Power Grid Corp., PNB and Rajesh Exports.

FIIs were net buyers of Rs1.4bn (provisional) in the cash segment on Tuesday while the local institutions poured in Rs4.2bn. In the F&O segment, foreign funds were net buyers of Rs9.51bn. On Monday, FIIs were net sellers of Rs5.33bn in the cash segment. With this, they have pulled out over $5.5bn from the Indian market this year.

Resources - Indiainfoline News Services