Market is in bear hug; Bears had fully optimized the power play. Bloodbath in the market continues; Sensex cracked 23000-mark, Nifty under 7000-level. Sensex crashes 807 points as slowdown fears haunt markets again. Markets continue to bleed with nifty trading below 7000 levels & closed at 6996. The Sensex lost 807 points to end at 22951, while the Nifty finished at 6996, down 239 points, breaking the crucial 7000 psychological barrier. The Bank Nifty lost a massive 3.84 per cent, closing at 14028. Financial services, auto, commodities and energy stocks closed down 3%. Markets fell steeply on the back of continuing concerns about a global slowdown and the consequent impact on the financial sector. The US Fed also did not provide any further clarity on the possible interest rate movements. Quarterly results declared over the past few days have also not met up to the muted expectations and that also impacted sentiments. Going ahead, global concerns will remain at the centre-stage and will likely dictate market sentiments.
This pressure is likely to continue. We are not expecting a solid recovery. There may be sharp downgrades coming after the results in FY17. If the Budget is able to show some direction on how the demand will be created, a bounce-back can sustain. Now, we need to closely watch the budget where the FM has a difficult task of supporting growth while maintaining fiscal prudence. Immediate support is at 6900 which is likely to limit the downside. A break below this level can drag the contract lower to 6850 and 6800 levels. The contract will come under pressure only if it declines below 6800. Such a fall can drag it lower to 6700 and 6600 thereafter.
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Resistances: 7000, 7050, 7100
Supports: 6950, 6900, 6850
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