Global cues to affect bull run

Weak global cues like gloom from Europe, slower Chinese growth and fears of Ebola, continued to keep FIIs in sell mode; and markets extended their losing streak for the fourth straight week. The Sensex closed at 26108 while the Nifty closed at 7780, both down nearly one per cent each.

Marketmen ignored positives like declining inflation and sharp fall in crude oil prices; and jitters of FII sell off kept the volumes on lower side. Despite positives like the deregulation of diesel and the announcement of gas price hike ahead of schedule, market players may be disappointed by the BJP’s inability to get a majority in Maharashtra.

What can really turn this market around is not the politics or reforms from the government, it’s strong corporate earnings. Investors need to focus on whether or not companies are growing. Global cues and Q2 earnings will continue to trigger sharp stock specific movements in the coming week also.

For the week ahead, chartists predict a trading range of 25,650 and 26,475 for the Sensex and 7,650 and 7,875 for the Nifty. Immediate supports for the indices are at 25,850 and 25,650 and 7,710 and 7,650.

Keep close watch on 100DMA, breach of these may trigger small intermediate downtrend. October could turn out to be a blip in a long bull market. Investors must evaluate market conditions, follow trend, and anticipate next move as well as the probability of that move to be successful.