A Big Move Coming

The market’s trading band has narrowed. It will not stay that way and will be resolved with a massive move. Will it be up or down?

The Sensex edged higher in early trading on Friday, tracking the rise in Asian stocks. However, it pared off early gains very soon and was mostly flat for the rest of the day. It closed at 17,554 points, 30 points lower than the previous day’s close.

The market’s trading band has narrowed down to an extreme. This usually presages a major move. We can’t say at this moment whether the market will end higher or lower, but a big move is certainly coming. 

Through the day, it touched a high of 17,639 and a low of 17,529 points. The Nifty ended the day down 9 points. The bullish sentiment was subdued as inflation in December 2009 touched a one-year high, reinforcing fears that the RBI will be forced to tighten monetary policy. The wholesale price index rose 7.3% in December 2009 from a year earlier, its highest level since November 2008 and accelerating from a 4.8% gain in November 2009. This is largely because of a 20% rise in food prices following a weak monsoon and flooding in parts of the nation.

Reliance Communications gained 4.76% after it got a nod from the market regulator to launch an IPO for its telecom tower unit. Power Grid Corporation of India (up 1.11%) has received its board’s approval for the participation in a joint venture with Nepal Electricity Authority and IL&FS for a 400KV Indo-Nepal transmission project. Tata Consultancy Services (up 1.48%) rose ahead of its quarterly result. Some of the banks have announced their results today. Axis Bank (up 1.52%) posted a growth of 4% and 51% in total income and operating profit in the December quarter over the same period last year. HDFC Bank (up 0.61%) reported a declining income (down 10%). However its operating profit grew by 11% over the same period. IDBI Bank (up 0.72%) posted a growth of 26% and 64% in income and operating profit for the December quarter over the year-ago period.

In the US markets on Thursday, the Dow gained 29.78 points, the broader Standard & Poor's 500 index rose 2.78 points and the Nasdaq Composite Index was up 8.84 points. 
 

  • Like this story? Get our top stories by email.

    User 

    We are listening!

    Solve the equation and enter in the Captcha field.
      Loading...
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email

    BUY NOW

    online financial advisory
    Pathbreakers
    Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
    online financia advisory
    The Scam
    28 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
    Moneylife Online Magazine
    Fiercely independent and pro-consumer information on personal finance
    financial magazines online
    Stockletters in 4 Flavours
    Outstanding research that beats mutual funds year after year
    financial magazines in india
    MAS: Complete Online Financial Advisory
    (Includes Moneylife Online Magazine)