Sensex may target 17,000 this month

A renewed buying interest at the start of the August series, coupled with short-covering owing to July futures & options expiry, boosted the markets towards the end of the week.

Earlier in the week, the markets had exhibited a lacklustre movement. The Sensex, after moving in a narrow range on the first two days of the week, tumbled to a low of 14,888 on Wednesday. The index, thereafter, recovered smartly and rallied to a new calendar year high of 15,733 — up 844 points from the week’s low.

The BSE benchmark index finally ended the week with a gain of 291 points at 15,670. In the process, the index has surged over 14 per cent (2,166 points) in the last three consecutive weeks.

Among the index stocks, Tata Motors zoomed nearly 13 per cent to Rs 422, while Tata Power soared 11 per cent to Rs 1,302. TCS, ITC, Hindalco, Wipro, SBI, Tata Steel and HDFC rallied 5-9 per cent each. On the other hand, Hero Honda shed nearly 8 per cent to Rs 1,606. Sun Pharma, Grasim and Reliance were down 3-6 per cent each.

As expected, the Sensex revisited its June high, and ended on a firm note. The markets look a bit tired at current levels. Hence, some profit-taking can be expected before the next up move.

However, the overall trend remains bullish, with 14,100-14,500 as base for the month of August. On the upside, the index is likely to target the 17,000-mark during the month. This week, the index may face resistance around 16,000-16,200. On the downside, the index is likely to find support around 15,350-15,150.