On Thursday, FIIs net bought stocks worth Rs 1100 crores in the cash markets, while on Friday they net bought shares in excess of Rs 700 crores.

The week saw heavy buying in banking stocks, particularly Yes Bank, which rallied more than 20 per cent on Thursday, while ICICI Bank rallied substantially on both days and IndusInd Bank joined the party. The rally was sparked largely by measures announced by new RBI Governor Raghuram Rajan.

Trading for the next week is truncated given the fact that markets are closed on Monday for a festive holiday.

Tuesday is expected to be volatile given reports that US President Barack Obama would be addressing the nation against a possible military Syria on Syria. Any strike on Syria and a prolonged conflict is likely to keep oil prices elevated and Indian markets are likely to drift lower.

The US non farm payrolls jobs report that came in less then expected in August at 169,000 additions, has raised questions over whether the Federal Reserve will begin a pullback on its asset purchase programme or QE3 on Sept 19.

This should augur well for global markets and also in India, which could rally. With the rupee continuing to gain against the dollar, banking stocks are likely to once again set the markets on fire, with investors most likely shunning IT stocks for banking stocks.

The next couple of weeks are crucial for the markets given the US Federal Reserve decision on its asset purchase programme on September 19 and our Monetary Policy on Sept 20. Apart form this there is the WPI data which will set the tone for interest rates and monetary tightening.

Clearly, its volatile times for our markets. Invest, if you have the appetite to digest volatility.

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