Outlook for Nifty still remains negative

- Alex Mathews, Geojit BNP Paribas Financial Services

The markets had opened on a flat to negative note tracking the global markets especially US but reversed very soon moving into the green territory. The markets slipped once again in the noon session but gained momentum later to move up to touch the highest point of the day and closed for the day in green but off the day's high.

The other day US markets had slipped as investors in US remained sellers on financial shares on concerns about Euro zone which made our markets to open in red and the sluggishness continued on concerns of rollback of stimulus packages in the upcoming budget. Soon positivity in the Asian markets helped our markets to move into the green. In the second part of the day, European shares gained strength after opening lower as they shrugged off the worries about the financial problems in Greece. Asian markets too rebounded with upmove in commodity prices. The US index futures too showed strength which helped our markets to move up in the later part of the day.

In the afternoon session we saw tremendous buying in PSU stocks like NMDC, NFL, Hindustan Copper, FACT, and ITI etc. Cement sector was one another sector which rose today as news came out that the cement companies have raised the cement prices with effect from February 1st 2010. Stock specifically STC, Suraj Diamonds, HMT, Subex and Gati made good gains of over 10%.

The outlook for Nifty still remains negative and is having resistance at 4845 and 4860 while the support is there at 4775 and 4745 and thereafter all round selling. We may not see any pre-budget rally but post budget rally is likely because the volatility of Nifty is still on the higher side.

Source : Equity Bulls

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