Cashing in money
MUMBAI: Indian equities rose for the fifth-straight session on Friday, helping script their best weekly gains since early November. But gains in
benchmark indices were capped, as investors trimmed exposure to frontline shares fearing a reversal in the recent bullish trend, which drove up the Sensex by over 12% this week.
“The rally may be capped after 2-3% gains. We are expecting some solid profit-booking in large-cap stocks,” said Quantum Securities director Neeraj Dewan.
On Friday, the 30-share Sensex ended 45.3 points, or 0.4%, higher at 10,048.49 pts while the 50-share Nifty closed 26.4 pts, or 0.8%, higher at 3,108.65 pts. The lack of certainty about the direction of front-line shares resulted in investor focus shifting to mid- and small-cap shares. Gainers outnumbered losers 1527:1018 on the Bombay Stock Exchange (BSE).
Dewan expects the Sensex to face stiff resistance at 10,400 levels and sees the index finding strong support at 9,200 levels.
Brokers said the extended optimism on Friday was on account of better-than-expected US economic data and improved home sales there, easing concerns over a prolonged economic crisis. Optimists believe even if US markets weaken a bit from here, Indian equities would not be impacted much, as majority of the activity now is revolving around the general election results.
“Unless the election results do not reveal any negative surprise, the bottom of 8,160 pts is expected to hold,” said Vishal Jajoo, equity analyst, FCH Centrum Wealth Managers. “We feel for the moment, it would be prudent to trade on the long side wherever share prices correct and offer a buying opportunity,” he added.
According to a recent UBS report, Indian shares may rise 35% in the next 12 months, extending the rally in anticipation of a recovery in earnings the following year. The Sensex may climb to 13,500 pts by March 2010, the report said.
- Last Modified: March 29, 2009
- Filed Under: MARKETS
Leave a Reply
You must be logged in to post a comment.