Today,after a really long weekend, the market could be headed for a new high before bidding farewell to the year 2009. However, with only three trading sessions and F&O expiry one will have to brace for a volatile week. Trading might be thin, both here as well as overseas, as many players would have opted for an extended year-end holiday. As for today, we see a modestly higher opening for the key indices and sideways movement.
We would urge some caution at this juncture, as the market has already had a spectacular rally this year.The headroom for further advance is limited. One will have to be extremely choosy and careful. Factors like rising inflation, an impending hike in interest rates and high fiscal deficit could weigh on the sentiment.
There are also worries as to how different nations go about withdrawing the emergency stimulus measures, and how it may affect the economic recovery. On the corporate front, future earnings growth will have to reflect pick-up in demand rather than just cost cutting.
