Previous Week : Sensex was up by 605 points to close at 19420 levels
Indian equities traded higher for the week. It closed in green in four out of five trading session during the week. The FIIs were net buyers throughout the week. Global news flows continues to remain bad as unrest in MENA region (especially in Libya) worsened.
  • On a week-on-week basis, the Sensex was up by 605 points or 3.2%, to close at 19420 levels
  • The S&P CNX Nifty also closed in the green by 171 points, or 3.1%, to close at 5828 for the week. Buying was seen in sector heavyweights such as Tata Motors, Maruti, Bharti Airtel, TCS, Mahindra & Mahindra, Hindustan Unilever and ITC
  • Food inflation for the week ended March 19, 2011 was 9.5 % (v/s 10.05% last week). The index for primary articles declined to 12.98% from 13.53% for the week under review, while that for fuel climbed to 13.13 %( v/s 12.8% last week)
  • Crude prices at alleviated levels unrest in MENA region (especially in Libya) worsened. During the week, Brent crude remained in the range of ~ $114 -$118 / barrel while Nymex crude remained at $ 104 - $107 / barrel
  • The news on the economic front was mixed bag as the GDP data by the commerce department reported that the US economy in the fourth quarter of 2010 grew by 3.1%, higher than the estimate of 2.8%
  • Weekly jobless claims report from labour department showed that jobless claims for the week was 3,88,000, i.e., lower by 6000 from the previous week
  • Another report by the Commerce department stated that factory orders in February 2011 dropped 0.1%, or $400 million, to $446 billion
  • Private sector employment rose by 201000 jobs in March 2011 following a downwardly revised increase of 208,000 jobs in February 2011
  • A separate report from Standard & Poor showed a continued decrease in home prices in January 2011, as the underlying home price index fell at an annual rate of 3.1% in January 2011 compared to a 2.4% drop in December 2010
  • The pending home sales index rose by 2.1% in February 2011 following a 2.8% decrease in the previous month

Week Ahead : Q4 March 2011 results starts mid-April 2011
The market may take a breather after 9% rally in the preceding eight trading sessions triggered by heavy buying by foreign funds. Benchmark Index may trade in a range while the Mid Cap and Small cap index can outperform in the coming week. In the month of March till date, FII were net buyers to the tune of 8395 crores while domestic funds are net buyers to the tune of 59 crores (provisional data). FIIs have been net buyers since last 5 trading sessions.
  • Among the key global data to watch for in next week is US Initial jobless claims, US consumer credit ratings, US housing stats, European monetary union produce price index
  • The near term major trigger for the market is Q4 March 2011 results which will start trickling in from about mid-April 2011
  • Investors will scrutinise post-result management commentary to gauge outlook on earnings at a time when rising salaries, raw materials prices and interest rates are pressurising profit margins of India Inc
  • Nifty has managed to gain more than 3% during last week after closing above the 200 days EMA which is placed at 5595 levels suggesting trend to remain positive till Nifty sustains above the 200 days EMA
  • For the coming week, Nifty has immediate support in the range of 5700-5740 marked by the 5 days EMA & 100 days SMA, crucial support comes at 5600 which is the 50% retracement of the recent rally and also the 200 days EMA
  • On the higher side, immediate resistance is in the range of 5900 - 5920, sustaining above which on closing basis Nifty can test the psychological level of 6000 during the coming week

Source: ICICIdirect.com