Fears of a weak start in the last trading week of the year appear to have been unfounded. The Chinese market has shrugged off the weekend rate hike after premier Wen Jiabao said his government will be able to contain inflation. Stocks in Japan too have gained. Markets in Hong Kong are shut.
We expect a steady start though things might turn a little choppy due to the F&O expiry. Trading volume could get a fillip owing to the derivative settlement but the overall activity may remain sluggish. The key indices are unlikely to budge much from the current position.
Real action is expected only in January when markets will digest latest quarterly results, along with fresh economic statistics. The RBI’s quarterly review will also be an important event in the face of the fresh upturn in inflation.
Global markets will continue to see muted action to the year-end factor. Individual stocks will continue see some action based on the news flow. The Nifty failed to surpass 50 DMA. Therefore, the sentiment remains cautious. We expect the Nifty to be in a range of 5850-6080.
