Mumbai: Dalal Street is likely to witness volatility this week, as the stock market heads towards consolidation tracking global cues, analysts say.
“The market will witness sideways consolidation and small bouts of buying will be seen. As the market has seen lower levels in the recent sessions, some upside can be expected now,” SMC Global Vice President Rajesh Jain said.
Analysts exuded optimism that Dalal Street in the days ahead could see a bear market rally as the negative news in the market are lessening.
“With the US markets moving up and the gravity of bad news lessening, there is a silver lining that the Street can see a bear market rally,” Ashika Stock Brokers Research Head Paras Bothra said.
Last week, the Bombay Stock Exchange benchmark Sensex gained 431 points in a volatile trade.
The BSE barometer settled the trade on Friday with a jump of 413 points or 5% at 8,757, while the wide-based Nifty gained 102 points to end at 2,719.25.
The Sensex registered its highest gain in the current calendar year, on the back of all-round buying triggered by stronger global cues. Prior to this, the Sensex had gained by 492.28 points or 5.37% on 10 December 2008.
On Friday, the domestic currency also strengthened in line with the stock market, showing gains. The Indian rupee rose by 35 paise to close at 51.51/52 against the dollar.
Marketmen said this week would see some consolidation as prices are currently at lower levels.
“With no major announcements expected in domestic front, the market would wait for cues from the global market. As the market has breached the higher bottom, there can be short covering,” Taurus Mutual Fund Managing Director RK Gupta said.
On Friday, the US market ended in the positive zone with the Dow Jones Industrial Average rising 54 points to 7,224 and the Standard & Poor’s 500 Index rose 0.77% to 757 points. Besides, other Asian markets also closed in the positive terrain.
During the week, FIIs made net investments worth Rs212 crore in the Indian equities. They have been net sellers of Rs9,228.30 crore in shares so far this year.
Besides, the WPI-based inflation dipped to over six year low of 2.43% for the week ended 28 February.