Column

Last week witnessed strong performance from bulls — which was anticipated — as internal triggers led by a strengthening rupee drove sentiment.

The weekly advance-decline ratioacross the Bombay Stock Exchange and the National Stock Exchange (NSE) combined was positive at 10230 : 7025. The capitalisation on a commensurate basis was also positive at Rs42,332 crore : Rs23,424 crore.
The NSE gained Rs175,291 crore in market capitalisation on a week-on-week basis.

In terms of sectoral performance, the rally was led by midcaps, followed by technology and banking.

Turnover was initiated on the upthrust days, underscoring optimism.

Overseas investors were net buyers at Rs2,068.5 crore, which lifted the rupee to 49.30 per dollar levels compared with 50.31 seen in the week before.

In the US, the old economy Dow Jones Industrial Average lost marginally whereas the tech-heavy Nasdaq gained 1%.
The UK FTSE gained more than its US peer.

In Asia, the rally was powered by China, Singapore, Hong Kong and Japan. Overseas cues remain optimistic and the domestic markets will need positive internal triggers to rally ahead.
Technically, the domestic markets are nearing the upper resistance line of a year-long bearish channel and the 5200-5250 band will be an area to watch out for.

The weekly range advocated for the Nifty between the 4650 and 5250 levels has held as the benchmark trended within these levels, especially during the upthrust.

This week is likely to witness a range of 5350 on the upside as long as the Nifty stays above the bullish pivot at the 5150 mark.
In case of declines, the Nifty is likely to test 4900 as long as the bears keep it below 5100 levels.

The outlook is turning cautious as the rally is quite mature and existing longs may be held with a protective stop-loss in the 5100-5150 band. Fresh aggressive leveraged buying may be avoided.