What is market expecting of Union Budget? Will it be a market benign budget or a damp squib? Come sixth of July we will all get an answer to that. In the meantime we can only hope for the best. But on the second day of Budget week we have witnessed a broad based sell-off in the market. The sectors which were supposed to have received sops from the Budget have participated whole hearted in this sell-off. Budget favourites like IT and steel sectors still withstood the onslaught of the sell-off, but Infrastructure did not. Are the market players simply getting Budget jitters or is there reason for real concern?
Whatever be the mind of the market , Nifty should be range bound between 4100 and 4500 till the Budget. Similarly Sensex should hold on between 13500 and 15000 range till market gets this big event out of the way. However close below 4100 in Nifty and below 13500 in Sensex will be quite disastrous for the market since it will spell out the mind of the market in no uncertain terms. Nifty will then spiral down to its pivot of 3500 and Sensex can plummet to 11500.
In my earlier post on 18 May 2009 titled "Rebuild Your Portfolio" I had suggested to retail investors to come completely into cash at the level of Nifty 4600. In case you have, then look out for the crucial levels of Nifty and Sensex as discussed above and be ready to once again start rebuilding your portfolio for the long term.
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