Dated 18th May, 2009

It was 10th consecutive week of gain for Sensex, the longest rally we’ve witnessed in recognizable past. Almost all sectors traded mixed during the week with reasonably good market breadth. Nalco, Zee Tele, Ranbaxy, HDFC and ICICI Bank gained more than 10% during the week while Cairn, ONGC, Sterlite and Tata Communications lost anywhere between 5-10%.


Looking at the outcome of the Elections and the clear mandate given to UPA, our markets should open with a huge gap up as is indicated by the Singapore Nifty. There is a possibility that we may see them losing ground from then. We might see a reversal from here and hence selling is surely recommended at the higher levels of Monday with a strict day close stop losses. SGX Nifty points a level of 4100-4150 at the opening. If this were to be the case, one can have a tight day close stop loss of 4250 and look for selling opportunity in Nifty and specific stocks. Risk averse traders better avoid the markets and wait for clear direction before entering.