Don't try to act too smart and curb your bravado as the mayhem triggered by the European debt turmoil shows no signs of abating. Prepare for another shakeout today, at least in the morning trades as risk aversion continues to reign supreme amid growing fears that the ongoing debt problems in Europe will upset the global economic recovery. The key Indian indices are likely to nose-dive at opening bell and the NSE Nifty is expected to test 4950, which is seen as a major support. Hopefully, there will be some recovery as the day wears on and the Nifty will end above the psychological 5000 mark.
Reliance and RNRL will be in focus today as the supreme court is likely to deliver the long-pending verdict in the gas dispute. Nobody has a clue what the final decision will be. But, since Reliance is an index bellwether any sharp movement in it definitely has a bearing on the sentiment. Overall, the trend looks weak unless global markets rebound. Don't take any aggressive bets and just stay put as the global situation is not conducive right now, though for India there aren't too many worries.
Europe's debt crisis and technical glitches in computer-driven trading sparked a massive selloff on Wall Street. The euro slid to a fresh 14-month low against the dollar, and investors fled to Treasuries, gold and other safe-haven investments. The Dow at one point was down almost 1,000 points. The blue chip US index recovered sharply but still ended over 3% down. The fact that the massive drop in the Dow intra-day was largely driven by some technical error should give some solace to the bulls. The monthly US jobs report will be out later today, and if estimates are anything to go by, it should show big improvement. That might potentially change things slightly after the recent mayham.
