The previous week was a brilliant one for the market, when both of the key indices crossed the important psychological levels – the BSE Sensex crossed the 10,000 mark, whereas, the CNX Nifty surpassed the 3,000 mark once again after the January 7, 2009 collapse. The reasons for the rise can be attributed to the huge short covering and a series of positive economic data in the US. US treasury’s USD1 trillion plan to remove toxic assets out of the banking system was the major driver for the market. On a week-on-week basis, the 30-share BSE Sensex gained 1081 points or 12% to close at 10048.49, whereas, the S&P CNX Nifty (50) ended at 3108.65, up by 302 points or 10.7%.
The movement that was seen during the previous week has raised the belief among the investor communities that the market had probably seen the bottom and there is a possibility of a further rally. While, the later part can not be ruled out completely, however, it would be very early to say that there would not be any further fall. Though the US data has been positive so far but still the market should wait for some more time to see whether the positive flow is sustainable. In the global markets also, there will be Japan’s industrial production for February and US consumer confidence for March among the important data to watch out for. These data may set some short-term direction for the market. Broadly, there can be downward correction, however, if market can sustain above the psychological support levels we may see further upside.