Market Outlook of 30-07-2009

Markets received a jolt from Chinese shores as Chinese markets tumbled around 7% during the day. Reverberations were felt in our markets too as Nifty slid around 140 points during the day. It recovered more than half of its losses to close exactly at 4500. Metals and Realty stocks were the worst impacted. Jindal Steel and Power was the only exception as it announced a liberal 5:1 bonus issue. Heavyweights were subdued throughout the day and the action was concentrated more in the mid caps category. Winners were stocks like Polaris, DCHL, Balrampur Chini, REC, GT Offshore and Rolta. TCS and JSPL were the only reasonable gainers from index stocks. Volumes were extremely high while breadth turned negative as losers outnumbered gainers by almost 2 times. 4580-4620 resistance is indeed turning out to be a crucial one. As of now it seems that this resistance is unlikely to be broken in a hurry. The heavyweights continue to be subdued even as mid caps hog the limelight. This phenomenon could persist for a couple of days more but even mid caps might find it difficult to attract buyers if Nifty fails to move above 4620 in next 2- 3 sessions. For now Nifty managed to close above the support at 4450 but a revisit below this level could open lower targets of around 4300 with some support around 4380. The mid caps that could seek higher levels in stable environment are Dish TV, Polaris, Aban (above 1025), REC, Crompton Greaves (above 307), Power Grid and KFA. Pharma counters like Cipla and Ranbaxy might also witness some up trend. Nifty has immediate support around 4445-4460 while above 4530 it could attempt a move towards 4585- 4600 again.