D-Street may inch towards consolidation: Analysts

A wave of consolidation is likely to greet Dalal Street this week as the bellwether Sensex, which touched its 10-month-high level of 15,103 points last week, is expected to witness a correction as anticipation from the government on the Union budget will weigh on the market.     

"The market is likely to be volatile as investors would wait for some announcement from the political parties for sops in the upcoming Budget," Ashika Stock Brokers Research Head Paras Bothra said.     

Analysts said the movement in the large-cap stocks would mostly be range-bound as the broader market would be on a consolidation mode with mid-cap and small-cap stocks recording some gains.     

"There is a probability of correction as the broader market would move in a side-ways zone. Investors would increase their cash portfolio and refrain from entering the market now," Bonanza Portfolio Assistant Vice-President Avinash Gupta said.     

Unicon Financial CEO G Nagpal said: "The markets would see stock-specific movement this week. As we approach the budget, markets would slow the speed of gains in frontline stocks and the cash stocks would move up."     

The BSE Sensex surged 478.30 points or 3.27 per cent in the past week and closed at 15,103.55 points, while the National Stock Exchange's Nifty index ended with a gain of 138 points at 4,586.90 points.

During the week, the Sensex managed to close above the psychological 15,000 level for the first time since September 2, 2008, as investors were heartened by the economic agenda of the new UPA government unveiled by President Pratibha Patil.     

As per government data, India's Infrastructure sector output grew 4.3 per cent in April against 2.3 per cent growth in the corresponding period last year.     

Analysts feel the market would closely watch the Index of Industrial Production (IIP) data expected this week.     

"FIIs may keep infusing money in the coming weeks too and domestic institutional investors could remain net sellers. However, if strong FII buying comes in there might be some upward bias in the market," Gupta said.     

Last week's trade saw foreign institutional investors pouring in about Rs 2,000 crore in the Indian equities and maintaining the buoyancy in the market.     

Stock markets worldwide witnessed a lackluster trade in the previous week, amid the world's largest carmaker General Motors filing for bankruptcy protection in the US.     

On Friday, the US market ended mixed with the Dow Jones Industrial Average gaining 13 points to 8,763.13 and the Standard & Poor's 500 Index dipping 0.25 per cent to 940 points.

"The movement in the global markets would also determine the trend of the domestic market. As nothing big is expected in the global front, the Indian markets would decide on its own course of action," Bothra added.