Nifty Weekly Analysis

Dear All,

Last Week Nifty ended with Modest gains of 1.36% & Sensex with 1.56% on account of the uncertainity over the progress of monsoons & Ongoing Debt crisis in EuroZone.

Even the possibility of Chinese Economy's moderating growth on account of Manufacturing activities expanding at a slower pace than expected kept a check on the gains of the markets globally.
For the Week ended 4th June, US markets closed approx 2% lower while Europe closed mixed (FTSE & CAC down 1.5% & DAX up 1.88%). All Asian Indices closed in the green only with the exception of Shanghai which closed 4% lower.
Stocks in US plunged around 3.5 % - 4% on friday over weak data & rising concerns over Economic conditions of Hungary.

In our Markets Last week, Telecom Stocks gave a Dead-Cat Bounce virtually off their 52-Week lows. Reliance Communication gained around 14% while Idea 10% & Bharti Airtel also gained 5-6% on a weekly basis . But caution is advised into bottom-fishing into them as they may even break their recent lows & sustain below them as the movements in last entire week were purely speculative on some take-over news in few select stocks. It is better to exit these stocks on every rise & shift the funds into some other better return yielding sectors.
Defensive stock like HUL rallied smartly on buy-back news. Metal Counters continued to face selling pressure & were clearly weak.
Robust GDP data (8.6%) boosted the market sentiment. Even Auto & Cement companies have clocked decent numbers for the month of May.
Government has made a killing by adding 68000 Cr to the revenue bounty on account of 3G Auctions thus helping it to bring down the fiscal deficit in the current fiscal.
Add to it, the revenue from Pan-India bid licence for Broadband Wireless Access Auctions.

On Monday, We have the all important EGOM (Empowered group of Ministers) meeting with respect to Fuel Pricing strategy. Hence special attention will be on Oil marketing Cos Stocks. IIP data for the month of April 2010 will be announced on 11th June i.e Friday.

Last week, Nifty Future made a remarkable comeback from the lows of 4933 upto 5134.9. But it has failed to cross a crucial level of 5137.
An important worrying factor is Lack of volumes & broad-based participation. Even sharp increase in volataility is also witnessed.
We continously stated that Markets are weak as This was only a pullback which has happened after breaking an important support (4816 - Nifty Fut). Even stated that this might just be the end of the Pull-Back rally. We still continue to feel the same.

For the coming week,
Nifty Future If breaks & sustains below 5007, Will fall upto 4935/4917. More weakness upto 4813 & 4684 only if Nifty future breaches 4907 on the downside.
On the other hand, If Nifty Future crosses & sustains above 5076/5080, it will move upto 5146 & 5230.
Nifty Future may trade in a range of 4912 - 5146.

Open Position - Nifty Future Short on friday at 5125 with 5137 SL
Nifty 4900 PE @ 36-38 levels recommended on Friday.


Regards,
Team Market View Investments.
9987750901