Nifty fails to hold 6200 but ends 41 points up; metals rally
06 October 2010
The equity benchmarks bounced back on Wednesday after a moderate profit booking in previous two days. The Nifty has been facing a resistance at 6200 level; it did touch that level again in the early trade today, but could not maintain the same.
CK Narayan of President Treasury at Sharyans Resources feels that the rally is not going to get fizzled out very soon. "We have very simple formula going on right now and the formula is that very low levels of selling and very high levels of liquidity. These two things are combining to make this nice bull market which is very comforting to a lot of people and I think as long as those two situations remain patent we are not going to see any change in the trend as such," he explained.
He sees the Nifty around 6,310. "The Nifty has moved up to about 6,240-6,250 and if we look at the set of charts and set of resistances above 6,240 somewhere there about it has a strong level of resistance which when exceeded will probably take the index to about 6,310. So we are going to keep moving in these small series of pokes."
Global cues were quite supportive today; Asian markets ended 0.9-1.8% higher post Japan's central bank Bank of Japan cut its key interest rate to near zero and plans for a 5 trillion yen fund to purchase bonds, commercial paper, ETFs & REITs.
European markets were trading 0.7-0.8% higher, at the time of closing of Indian equities. The US markets rallied 2% on Tuesday on speculation of quantitative easing.
Metal, technology, capital goods, auto, private financial and select power companies' shares along with Reliance Industries and DLF supported the Sensex throughout session. However, the sell-off in ONGC, SBI along with FMCG, select pharma and telecom companies' shares erased more than 100 points gains on the Sensex.