Market Outlook 15th October

Oct 15, 2013 No Comments by

Nifty is trading at its 52 week high of 6150 levels. Huge inflow of negative data has come but Nifty is shrugging off all those data and continuing its uptrend. To start with IIP data came at 0.6% which was far below the expectation of 2.5%. WPI inflation came at 6.6% which was above the expectation of around 6%. So, two big negative news of slowdown in growth and high inflation has brought no correction in the market.

The support came from Infy and Reliance which have posted better than expected result. These heavy weights have given the hope that the earning season won’t disappoint the market. Initially the market was expecting the earning season to be a lull but the tide has changed now. The catch in this is that both these blue chips are export oriented company. So, the rupee depreciation has acted in their favor. All the import oriented companies will show some stress in their balance sheet this quarter. It will be interesting to see how the markets react to that.

US is struggling to resolve the shutdown. It has been 14 days and a lot of talks between Obama and the Republicans but with no agreement. The debt ceiling deadline is 17th October. Last time when the debt ceiling was supposed to be raised S&P downgraded the credit rating of US by one notch and world markets crashed. Nifty went from 5800 levels to 5200 levels in matter of days. We do not expect such a crash but some correction is about to come.

Nifty is trading at its 52 week high. All the analysts have started looking out for levels of 6300 – 6500. Of course that is possible. Markets decide their own course. We can only try to predict which way it moves. Still we are not convinced about the sustainability of such high levels. The market can go to any levels but it is not the right time to go long. The traders who have not participated in the rally have missed their chances. The people trying to ride a passed wave will end up losing. So, this rally should be used to exit your longs and sit out for the next opportunity. Remember that markets are forever. Each day their is a new opportunity. So, wait for the next.

 

 

 

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