- After the 2000 points rally in the Sensex on Friday, the Sensex rallied another 1000 points on Monday creating wealth to the tune of nearly $150 billion in two days flat. The Bank Nifty is also up by nearly 3800 points in the last 2 days.
- Traders will now be a little more cautious as a lot of short covering may be out of the system and any upsides from here would depend on fresh buying. Unless that happens, it would be difficult for the markets to sustain.
- FPIs were net buyers to the tune of Rs.2684 crore while DFIs bought Rs.292 crore on Monday. If Friday saw short covering by FPIs, then the follow up on Monday came in the form of genuine buying and after a very long time.
- The US markets were flat but European markets were in the red on fears of a prolonged trade war between the US and China. Asian markets have been largely mixed but the SGX Nifty continues to trade in the green.
- We suggest buying selected FMCG plays like Colgate and Britannia for the tax benefits and the bigger impact on spending power of consumers. We see nearly 10% upsides on both these counters.
- Financial scan be a big beneficiary and beaten down broking stocks could be in the midst of action. We suggest buying Edelweiss at a price of Rs.122 for immediate short term targets of Rs.150 and higher.
- Our target of Rs.270 on Zee has already been achieved and would not continue to short at these levels. We suggest buying into Infosys on dips as the stock has corrected sharply in the last few days. Look at 10% upsides.
- Trade could be a lot more cautious on Tuesday as the pressure of higher levels builds up closer to the F&O expiry.
