Weekly Report 26-03-2011

It was not expected to be a good week but eventually turned out to be so, much to the delight of the bulls. The two main indices clocked impressive gains and are within striking distance of their 200-DMA levels. Once they breach the critical technical levels, there could be further gains to be had; how much more is anybody's guess.

Any fresh advance will need push in the form of steady FII inflows and continuation of the global rally. Also, there should be no major upheaval abroad. Crude oil too should not spike sharply. Overall, the undertone has improved but one should remain on guard for any untoward incident.

On the domestic front, the Indian markets could turn slightly more volatile due to the F&O expiry. The end of fiscal year might also lead to last minute portfolio rebalancing. Local market participants will also react to the latest current account deficit and fiscal deficit numbers, besides auto sales and the trade figures.

EU Economic Summit, US GDP data and remarks by Fed officials on Friday could play a role in determining the direction of the western markets. Global investors will continue to keep an eye on developments in Japan, the MENA region and the eurozone. Important economic statistics to watch out for will include the manufacturing and services PMI data