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    Markets look overbought; selling pressure likely next week

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     Markets look overbought; selling pressure likely next week
    The fast and furious rally, which took the Sensex from a low of 18,100 points to 19,400 points in about eight trading sessions ended on Friday.
     

    Markets are looking overbought as they seem to have reacted positively to a fall in commodity prices, particularly gold and crude oil. On Friday the rally was stalled as Reliance and ICICI Bank pulled indices lower.

    The next week is likely to remain volatile with a host of companies likely to announce their quarterly results. This week results declared by most companies were good. Maruti, was the big surprise with its results being impressive.

    Banks declared results more or less in line with expectations, with most of them mildly surprising on the higher side.

    Going forward the worry for the market is the impasse in parliament. A few crucial bills remaining pending in parliament and a constant logjam is likely to be worrisome for the markets. The debate on the Finance Bill is also slated early next month, subject to parliament working.

    Markets are likely to fall if the parliament stalemate continues. Globally, things are looking good, with the German DAX, the French CAC and the UK's FTSE staging a rally this week. US markets have also gathered momentum.

    Clearly, for the Indian markets the next big trigger would be the RBI meet on May 3. Should the central bank cut rates more aggressively by say 50 basis points, markets are likely to react positively. Next week is a busy week for the markets, no doubt.

    GoodReturns.in

    Read more about: sensex nifty
    Story first published: Saturday, April 27, 2013, 11:24 [IST]
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