Indian mkts to stay range-bound as EU crisis unfolds

Taking positive cues from the US, Indian bourses may open with gains on Monday but will remain range-bound during the week as investors monitor developments of the euro zone debt crisis, say experts.

The BSE benchmark Sensex last week shed 2.1% in view of lower IIP data and poor quarterly results from some companies.

"Positive closing in the US market may lead to gap-up opening at Dalal Street but overall the trend will remain bearish.

"Volatility is likely to rule and any negative news is going to affect the market. The undertone of the market will be range-bound," Ashika Stock Brokers Research Head Paras Bothra said.

Expressing similar sentiments, Alex Mathews, research head of Geojit BNP Paribas Financial Services, said, "Indices are expected to open with gains on Monday. But, going forward, the rally may not sustain for long at higher levels due to poor corporate earnings and euro zone crisis."

On Friday, the US stock market rallied; the Dow Jones Industrial Average closed 2.19% higher, while S&P 500 gained 1.95% and tech heavy Nasdaq 2.04%.

Italy and Greece moved closer to form new governments and getting their financial crises under control.

Analysts said that European concerns would continue to impact global markets with Italy being the new focus area.

CNI Research CMD Kishore P Ostwal said, "Markets have been reacting to global weakness, yet there does not seem to be much downside and markets will see a firm opening on Monday when Nifty will retest the 5,400-mark."

Unicon Financial Solutions CEO Gajendra Nagpal too said, "Markets have already discounted the bad IIP data and more or less the euro zone crisis has also been factored in. So, the outlook remains positive for the market. Italy and Greece will be closely watched this week."

Monday will also be crucial as inflation data for the month of October will be released and stock market may react to the same, experts said.

This week will see unveiling of quarterly results by Sensex blue-chips such as Mahindra & Mahindra, Tata Motors, BHEL, Cipla, Jaiprakash Associates and Tata Power.