Fireworks likely to continue

The markets are likely to continue the upward march in the coming week given the positive breakout on the daily charts. The Nifty has immediate support at 6,300, which should be seen a key level for the markets to trade higher.

The BSE benchmark index, the Sensex, began the week on a positive note. The index gathered momentum on positive vibes from the Reserve Bank of India (RBI) and the US Fed. RBI, in its second quarterly review, raised rates by 25 basis points. More importantly, it signaled a pause to the rate hike cycle in its December review. The US Fed also announced fresh impetus - worth bond purchases up to $600 billion - in a bid to revive the US economy.

The Sensex rallied to a high of 21,109, and finally settled at a record high of 21,005, up 973 points (nearly five per cent) this week. The index is just 200 points away from its record high of 21,207 touched on January 10, 2008. Getting there could be a mere formality given the strong momentum.

Among Sensex stocks, Jaiprakash Associates, SBI and ACC surged around 11 per cent to Rs134, Rs3,490 and Rs1,090, respectively. Hindalco, ICICI Bank, Mahindra & Mahindra, Sterlite, Tata Motors, Larsen & Toubro and HDFC rallied 7-10 per cent each. Maruti Suzuki, however, was down 2.5 per cent at Rs1,514, the sole prominent loser.

The NSE Nifty touched a high of 6,339, and settled with a gain of 295 points at a record 6,312. The index is 45 points shy of its all-time peak of 6357.

Going by the current trend, the Nifty may easily target 6,400 next week as long as the 6,300 support holds. In case of a dip, the index may seek support around 6,215 and 6,155. In fact, it seems like the base has now moved to the 6,180-6,200 level.