Nifty shows extreme strength to close above 5050 - Alex Mathews

After opening on a negative note our markets moved in a sideways manner till the afternoon session when it started to move up tracking European markets and the US index futures and closed for the day and week with net gains made in the last two days. Nifty VIX fell around 4% to 23.99. FIIs are seen bringing in some money in the last month of the year which has been the same way for last couple of years. FII inflow will have a positive impact on rupee which has already shown signs of strengthening from the record low levels. Allowing FDI in multi-brand retail is still under the consideration of the Parliament which has not functioned for the last couple of sessions and is now adjourned till December 7th as far as FDI in retail in concerned. All the sectoral indices on BSE gained today with power, banking, technology and IT and metal leading the gainers. Metal stocks gained on the back of upside seen in the metal price on LME on expectation that easing of monetary policy will bring more demand for base metals in emerging economies. Rate sensitive sector too gained on expectation of move from the RBI while auto stock gainer on festival sales demand.

Nifty today showed extreme strength towards the end of the day closed above 5050. The European Union leaders are meeting on December 9th to take decision on way to confront the debt situation which is considered a crucial decision. For Nifty the major resistance would be 5102 and 5154 while the support is there at 4958 and 4919 levels.

Asian markets were trading sideways to positive after the previous day's rally. The sentiment is however positive as US ISM Manufacturing Index rose to 52.7 against 50.8 and Goldman Sachs and HSBC holdings plc gave their forecast that China will cut interest rates further in 2012 adding to the positiveness ahead of the US jobs data. No major actions are being taken in euro zone as far as the debt crisis is concerned and the leaders are still engaged in talks and stock gained on expectation of a moderation in US job data. Apart from that, sanctions on Iran and Syria are mounting. EU is considering cut off of oil import from one of the world's largest oil exporter, Iran. In the case of Syria, EU barred exports of surveillance technology to Syria. In US, the initial jobless claims rose to 402000 from 396000 earlier. During the day we are expecting Chinese retail sales and later US nonfarm payrolls and unemployment rate.

Source : Equity Bulls

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