Diesel Price Hike Proposal Fuels Hope - Karvy

The Prime Minister's statement that diesel prices have to be hiked, has made the markets happy. The proposal is to raise the price of diesel in a gradual manner by about Rs 10 over the next year. A similar approach to kerosene pricing is also in the works. But, such diffi cult decisions take time to get implemented, as the political costs associated are high. Fiscal Cliff negotiations have also drawn investors' attention. It looks likely that some kind of a deal will be patched together before the New Year. Amidst high hopes of a deal, bullion prices continued to be under pressure.

The current account numbers will be out on Monday. There is a strong likelihood that the country will post a record high current account deficit.

After two blockbuster stock market debuts-CARE Ratings and PC Jeweller-Bharti Infratel was off to a disappointing start. The $760 million IPO, the biggest in the last two years, failed to impress recording a 13% drop on Day One.

Last week, the Nifty traded within range of 5840-5930 as part of its last three weeks trading range of 5830-5950. The Energy, Realty and Capital Goods sectoral indices had seen healthy participation outperforming the broader markets. Whereas, Metal, FMCG and Consumer Durables sectoral indices had underperformed the broader markets. Long positions can be assumed in Auto, Banking, Cement, FMCG, IT, Metal, Realty and Telecom sectors if markets sustain above 5850 levels. Short positions can be accumulated in Consumer Durables, Pharma and Utilities if the Nifty breaches 5850 levels. Overall, we expect the Nifty to trade in the range of 5800-6000 levels for the next week.

Source : Equity Bulls

Keywords