Today we expect a soft opening as most global markets are in the red. The sluggish market provides an opportunity to get out of weak counters and enter relatively stronger ones. Medium to long term outlook for India is upbeat. Immediate support for the Nifty is likely to kick in at 5180-5200. Below that the levels to watch are 5150 and 5100. On the way up, the Nifty may continue to find resistance at around 5300.The quarterly numbers so far give faith that companies have done well not just by cutting costs but also by improving sales. Even as most numbers have beaten street expectations, skeptics have their doubts; they would rather wait till many more numbers are seen. The result season will switch into a higher gear even as the market awaits the RBI’s policy action.
Inflation has jumped quite a bit in recent times, especially on the food front. Though monetary policy has no direct impact on prices, the RBI is under pressure to reign in inflation expectations. A CRR hike has been discounted while a rate hike will definitely surprise the markets.On the global front too, corporate results have started coming in and could have a bearing on sentiment in case of any nasty surprises. US stocks fell by 1% on Friday despite good results by JP Morgan Chase and Intel. In fact, Wall Street suffered its worst one-day fall in 2010. US markets are shut today on account of Martin Luther King Jr. day holiday.
