Markets will need ample local triggers for fresh rally

The last week witnessed a bullish undertone as the year-end attracted buying conviction aided by optimistic triggers from the overseas markets.

The weekly combined exchange market breadth was positive as the figures were 11,978 : 9,028. The capitalisation of the same on a commensurate basis was also positive as the figures were Rs37,129 crore : Rs32,747 crore.

The sectoral performance comparison shows the banking sector leading the rally, followed by the technology and mid-cap segments.

Foreign institutional investors were net buyers to the extent of Rs3,373.4 crore and that saw the rupee close at the 44.70 levels vis-a-vis the US dollar (previous week 45.11 levels).

The US markets saw the Dow Jones Industrial Average index scale new year highs but the week-on-week close was tepid, whereas the Nasdaq Composite actually recorded week-on-week losses.

The UK FTSE100 lost more ground than the Nasdaq Composite and erased almost all gains of the prior week, recording a bearish piercing pattern on the weekly candle charts.

In the Asian region, the Singapore market led the bull charge and was followed by the Hong Kong market. The Chinese markets lost ground and were followed by the Japanese Nikkei which also lost mild ground. Overall, the overseas cues are not very enthusiastic and the domestic markets will need ample positive triggers internally to fuel a fresh rally.

Technically, the domestic markets have managed to record gains for the third week in a row and the 6090 hurdle has been overcome.

The weekly range advocated for the Nifty at 6130/5825 has held as the Nifty kept to these levels more or less. This week is likely to witness a range of 6250 on advances and 5875 on declines. The bullish pivot will be at the 6075 levels and the bearish pivot at the 6040 levels. Traders may nurse their existing long positions and await higher levels to book gains on longs.