India decoupled from China fever

Buoyed by Bank of Japan’s negative interest rate strategy, sharp recovery in crude oil prices and positive global trends markets have ended a “schizophrenic” January on optimistic note.  

Benchmark indices the Sensex and the Nifty ended 435 points and 141 points higher at 24,870 and 7,563 respectively during the week ended. Midcap and smallcap indices have also rallied by over two per cent suggesting return of risk appetite among market players. With Union Budget 2016-17 on the horizon, expectations over reform agenda are back. Analysts expect a “big bang” budget which will lay roadmap for double-digit growth.

Indian markets managed to decouple a bit from the chaos in China. Observers of global markets feel that the link between oil and stocks makes little sense; and state of the economy is more important than anything else. Near-term direction of the markets will be dictated by RBI policy review on Tuesday, macroeconomic data, rupee-dollar movement, crude oil prices and the last batch of Q3 earnings.
Buy quality stocks on correction from medium to long term horizon. For the week ahead chartists predict trading range of 24,350-25,400 and 7,385-7,725 for the indices. Immediate supports for the indices are at 24,575 and 24,300 and 7,470 and 7,385.

Behind every stock is a company. Find out what it’s doing, study in-depth fundamentals, limit risk, and resist crowd psychology before investing. When it comes to investing, nothing will pay off more than educating yourself. Do the necessary research, study and analysis before making any investment decisions.  Research is much more than just listening to popular opinion.