Today, we see the market opening flat to slightly positive. There may be some cooling at higher levels. On the whole, we expect some choppiness after the recent spurt.
After a year of headwinds, the bulls got some tailwind as the New Year brought some cheer with the key indices rising three days in a row. The Sensex and the Nifty closed above key psychological levels, aided by strong buying by FIIs as well as local institutions. Some short covering also propelled Monday's strong gains. The Fiscal Stimulus Package II and RBI's aggressive monetary easing have heightened hopes for a better year ahead. More fiscal measures could be announced in the Vote-On-Account next month to ensure a faster economic recovery.
The undertone has definitely improved a notch or two, so we hope. The optimism stems from the belief that India is better placed than most economies, and global funds may find it hard to resist. A big concern is the health of India Inc. In this context, the upcoming results will prove to be a litmus test and set the tone for the months ahead. Among the other events to watch out would be the shift in regime in the US.
After surging past the 3100 levels, markets would carry forward the momentum atleast in the today's morning trades. However, profit booking at higher levels cannot be ruled out.
