MUMBAI: In tune with global cues, the markets traded on a flat note with a negative bias. With bouts of volatility, selling pressure in the second half caused the markets to slide, which took the Nifty below key technical and psychological levels, and the index ended the day well below important levels.

While auto and banking stocks witnessed a mixed trend, IT stocks surged following the announcement of better-than-expected US job data. However, it was the metals and PSU stocks that dragged the overall markets. The weakness in oil & gas and realty stocks also favoured the bears.

Tata Motors lost ground, and was also the top loser from the Sensex pack amidst reports that German automaker Daimler sold its entire stake of 5.34% in the company.

As expected, the share price of NMDC took a beating following the  announcement of its FPO price band, which is almost 25% lower than its closing price yesterday.

While Tata Motors fell 3%, NMDC dipped by almost double of that (6%) during intra-day trades. Investors looking for exposure through the secondary market in the latter would do well to wait for price discovery post the FPO...

For now, the opening trend would depend on the global cues, which seems to lack direction at this point in time. On the domestic front, IIP numbers by the end of the week is the only likely trigger. While the markets may consolidate, there are clearly no visible triggers for the same. As the underlying sentiment remains bullish, a sharp decline could be used as an opportunity to initiate long positions.

Technically, the Nifty has strong support near the 5,060-5,070 level....a breakout above that level triggered a run-up till 5,150 from where it has started to cool off....

Traders can consider going long with a strict stop-loss at the intermediate support level. For investors, a wait & watch approach for emergence of a decisive trend seems to be the optimal strategy for now.

(The report is powered by www.theipoguru.com)

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