The week gone by began on a negative note and continued to remain volatile. The news flow on the geo-political front was more positive than what has been seen over the last few months. With the US looking to exit the war honorably and their desperation visible, it’s likely to happen sooner than later. The contentious issue is enriched uranium and that may be tricky. Do not be surprised if in a final settlement, Iran agrees to give the same to China or Russia, rather than US.

Can the positive news happen tonight? Your guess is as good as mine. The important thing is that US wants to get out as quickly as it can as it has spent almost three months in a war in which it felt would be over in say a couple of weeks at worst.

Our markets gained on three of the five trading sessions and lost on two. BSESENSEX gained 177.36 points or 0.24% to close at 75,415.35 points while NIFTY gained 75.80 points or 0.32% to close at 23,719.30 points. The broader markets saw BSE100, BSE200 and BSE500 gain 0.42%, 0.56% and 0.50% respectively. BSEMIDCAP was up 1.22% while BSESMALLCAP gained 0.59%. The top sectorial gainer was BSEIT which gained 4.08% while the top loser was BSEFMCG which lost 1.46%. The intraweek lows which were made on Monday were at 74,180.26 points and 23,317.10 points. The highs which were made on Thursday were at 75,945.79 and 23,859.90 points respectively.

The Indian Rupee gained 17 paisa or 0.18% to close at Rs 95.70 to the US Dollar. Dow Jones gained on four of the five trading sessions and lost on one. It hit a new all-time intraday and closing high on Friday. The intraday high was 50,830.24 points while the close was at 50,579.70 points. Dow gained 1,053.53 points or 2.13%. 

RBI has declared a dividend of Rs 2.87 lakh crores to the government. They would be meeting in the first week of June (3rd to 5th June) for their policy review meeting. May futures would expire on Tuesday 26th May. The current level of NIFTY at 23,719.30 points is 276.40 points or 1.15% lower than the series open. If positive news does come in, the bulls will pull back and take the series, or it will be a close call. We also have a trading holiday on Thursday on account of a religious festival. This would break market momentum and affect trading trends. Hopefully if the war is resolved by then, it would add to the momentum after a trading break. If not, holiday and then last day of the week, would keep markets under pressure.

Markets have been range bound last week but for the weak Monday opening when they went down sharply and then recovered to close in positive territory. Resistance for the markets is at levels of 23,800-23,850 points, which is incidentally the high of the week (23,859). If this were to be crossed we would face resistance at 24,300 points. On the support, it exists at 23,300 points, low made on Monday was at 23,317 points. If this were to break, support exists at 22,800 points.

The strategy would be to build a portfolio and for any trading positions, only intraday. Currently to have overnight positions could be dangerous as we have a man who is calling the shots in this war is badly cornered and looking for an escape route. What he would do next may be irrational as well.

Keep fingers crossed and hope next week brings good news.  

Arun Kejriwal (Market Veteran Investor & Opinion Maker)