Indian Dalal Street: Weekly Outlook for Nifty and Market. (From 13-9 to 17-9)

This week market may trade on both side with high volatility.

Last week Sensex gained 561 points or +3.08% to 18799 and Nifty gained 154 points or +2.81% to 5640 in the week ended 10-9-2010. As we told last week, if nifty cross 5543 then buy nifty, enjoy good profit with us. Still Nifty is having space to cross 5700 level. On Last Thursday nifty made high of 5710 in the morning. Now this level will act as resistance for nifty. Technically on daily chart Nifty made Invert Hangingman formation. If nifty close above 5710 then it may touch 5800 and more very quickly.

Looking to Strong IIP data rise Market may open in gap up. Keep Close eyes on these events. From this 15 Spet 2nd round of Advance tax and 14th Sept Inflation Data will be announce. and RBI Policy review on 16th Sept. This week we advise to buy nifty if it close above 5691 to 5710. Otherwise remain neutral and sell nifty only below 5575 on closing basis. Nifty may show high volatility so keep strict sl in every trade.

**WEEKLY INDEX SUMMRY**
INDEX	LAST WEEK 10-09-2010	PREVIOUS WEEK 03-09-2010	PERCENTAGE % (+/-)	POINTS (+/-)
SENSEX	18799.66	18221.43	+3.08%	+561
NIFTY	5640.05	5479.40	+2.81%	+154

Data on advance tax payment for the second installment of 15 September and macro economic data will be in focus next week. Another major event is a mid-term monetary policy review by the central bank on Thursday, 16 September 2010.

The second installment of advance tax payment which falls due on 15 September 2010, will give a hint about Q2 September 2010 corporate results. As per market speculation, the total advance tax payment is pegged at Rs 50000 crore. Stock-specific activity is likely based on the advance tax figures of individual firms.

A section of the market is concerned that a strong equity issuance pipeline over the next six months will soak liquidity from the secondary equity markets. This includes a large initial public offer (IPO) from Coal India in October 2010. The state-run firm expects to raise $3 billion (about Rs 14000 crore) from the IPO. The government is divesting a 10% stake in Coal India through the proposed IPO.

The Quick Estimates of Index of Industrial Production (IIP) with base 1993-94 for the month of July'2010 have been released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation. The General Index stands at 330.8, which is 13.8% higher as compared to the level in the month of July'2009. The cumulative growth for the period April-July 2010-11 stands at 11.4% over the corresponding period of the previous year

The government will unveil inflation data for August 2010 on Tuesday, 14 September 2010. The wholesale price index (WPI) rose an annual 9.97% in July 2010. The annual food inflation rate fell to 10.29% in July 2010 from 14.6% rise in June 2010, with prices of vegetables and sugar falling on the month. Manufacturing inflation, which the RBI uses as a proxy for assessing demand, cooled to 6.15% from 6.66% in June 2010. On the flip side, the headline inflation for May 2010 was revised upwards to 11.14% from 10.16%.

The Reserve Bank of India (RBI) has raised its repo rate by 100 basis points (bps) and the reverse repo rate by 125 bps in the current rate tightening cycle. The repo rate is now 4.5%, the reverse repo rate 5.75% and the cash reserve ratio (CRR) 6%.

The recent turnaround of the Indian economy is likely to translate into sustained capital expenditure (capex) program of India Inc. This augurs well for the medium-term economic growth. High capacity utilisation in some of the key industries further corroborates likelihood of a capex upsurge.

On the global front, investors are looking ahead to August 2010 trade data from China on Friday, 10 September 2010. As per the market buzz, China will announce a big trade surplus for the month. (Data Source: Capitalmarket)

NIFTY WEEKLY CHART