F&O settlement, Q3 nos to guide markets

Shrugging away the rising crude prices, the markets fuelled by better than expected Q3 numbers, announcement of a reduction in extra borrowing, fresh cut in GST rates, rumour of allowing 100 per cent FDI in the banking sector, favorable global cues hit new highs.

Benchmark indices Sensex and Nifty closed 919 points and 213 points higher at 35,512 and 10,895 respectively.

Bank Nifty vaulted by 1,160 points to 26,910. Underperforming the benchmark indices, both the BSE mid- and smallcap indices closed lower by 2.1 per cent and 2.7 per cent respectively.

Cut in GST rates on 29 goods and 54 services ahead of the Budget kept the sentiment positive. With market players anticipating a sea change in the earnings trend starting from Q3 results, stocks specific action may continue ahead of Budget.

Economic data like WPI, IIP and PMI are also suggesting improvement in pricing and volume growth. With Prime Minister Narendra Modi delivering the opening speech at the World Economic Forum Summit in Davos, observers expect heightened interest on India from foreign portfolio investors.

Near term trend will be dictated by F&O settlement, investment pattern of FIIs, international crude oil prices and global cues. Track developments of US shutdown. Prolonged imbroglio may cast shadow on global markets.
For the week ahead, chartists predict trading range of 35,500-36,000 and 10,750-11,025 for the indices. Key supports for the indices are at 35,250 & 35,000 and 10,825 & 10,750.