Last week the Indian markets fell by 4 % as expected due to a lot of bad news coming in from the government in the form of deferring the FDI in retail bill, the negative growth on manufacturing, deferring the bills on insurance & pension reforms. The global markets were resilient with the EU leaders coming together to thrash out the issues. The devil is in the details, so we will need to see what the markets perceive on the EU leaders decision to manage the debt crisis. The Indian fiscal situation is going out of control and the government has said they will not meet the targets by March 2012. The investments into India will slow down with the lack of governance and the slowing growth.
This week the Indian markets have the IIP nos. and the government to look up for some help. The RBI will also be announcing the policy on 16th Dec. The advance tax nos. paid by the companies will be looked at to get cues on the growth for the quarter. We can see some volatile movements going forward. On the global front, we may see a short term correction this week post all the moves last week.
The derivatives position for the week stands at Rs 118212 Crs in OI; the PCR is at 1.08 the option IVs for Calls at 27 % & Puts at 31 %. The Nifty Future is trading at a 16 point Premium to spot. The volatility indicates we can see some sharp moves in either direction.
Nifty on 9th Dec 2011: 4858
Nifty trading ideas for the week: Buy around 4760: Target: 4950 Stop Loss: 4720
Stock ideas for the Week: Buy SBI around Rs 1800 for a Target of Rs 1950 SL: 1790