The Hindu Business Line : Bullish trend in indices

Preferred view: The index moved in line with last week's expectations. It ruled firm and also turned direction right at the target zone of 2820-2830 mentioned last week.

After touching a high of 2825.65, the Nifty went into a corrective mode on Wednesday. The recent pattern portrays a bullish outlook.

The Nifty appears to be headed towards the next target level of 2900-2910. This view would gain credence on a close past 2835. The index enjoys support at the 2730-2740 range. A close below 2730 would delay the progress towards the 2900 mark. The positive view would be negated only on a close below 2630. Holders of long positions may have a stop-loss at 2730.

Comments: The index closed above the psychological 2800 level on Friday. The bullish sentiment percolated to mid-cap stocks as well. Quite a few stocks have logged sharp gains in the recent weeks. Prominent among them include a clutch of stocks from the sugar industry — Bajaj Hindusthan, Dhampur Sugar, Sakthi Sugar and Sree Renuka Sugar.

Outside the sugar sector, market interest was evident in Asian Electronics, Venus Remedies, Nelco, Torrent Pharma and 3i infotech. In the large-cap space, VSNL, HDFC, BHEL and BHEL were the major gainers. Considering that the outlook for these stocks remains bullish, investors may hold with a suitable stop-loss. Fresh exposures may also be considered by long-term investors, with an appropriate stop-loss.

Long-term view: The index appears to be headed towards the 3000 mark in the long-term. This view would be valid as long as the index holds above the long-term negative trigger level of 2300. The positive outlook for quite a few index stocks tends to confirm the long-term bullish outlook for the index.

SENSEX (9284)

The index moved in line with anticipation and reached the target zone of the 9200-9250 range. The near-term outlook remains bullish and a move to the 9500-9550 range appears likely. This view would be valid as long as the index holds above 9000. From a longer-time perspective, the index appears on course to move to the 10000-mark.

CNX IT (3857)

The movement in the index was in alignment with last week's expectations. The trend was bullish and the index moved to the target zone of the 3840-3850 range. The short-term outlook is bullish and a move to the 3950-4000 range appears likely. The positive outlook would be force as long as the index rules above 3730.

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