Nifty likely to hit 18,000 mark soon

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Markets are likely to hold on to gains on Friday, as the derivatives sectors saw a healthy turnaround of long positions into the May series. With global markets rallying strongly, analysts expect the momentum to continue in Indian markets as well.

SGX Nifty at 18050 indicates that Nifty may top the 18000 mark sooner rather than later.

The market rose to a three-month high, supported by the ongoing fourth-quarter earnings season and short pressure on the monthly derivatives expiry, said Siddhartha Kimka, Head of Retail Research at Motilal Oswal Financial Services Ltd. Moreover, FIIs turned positive after seven consecutive days of selling adding to the overall positivity. We expect this rise in Nifty to continue above the 18K region.

Stocks across Asia were also moderately higher, with US stocks posting healthy gains overnight.

Wall Street knows you need a strong economy to keep stocks rising, said Edward Moya, chief market analyst, The Americas OANDA. Treasury yields headed lower after both the ADP private payrolls report and the ISM services index indicated weakness in the economy. Traders are turning defensive as utilities, health care, energy and consumer staples stocks rise,

He added, “The reason we’re not selling further is because many traders believe that even if the Fed doesn’t cut interest rates once the market has priced in, they will cut more aggressively next year.”

Even for the local market, corporate results were better than expected in most cases, and for some, they met Street’s expectations with only a few reporting lower-than-expected numbers.

Ruchit Jain, Lead Research, 5paisa.com The April series belongs entirely to the bulls as this series started by rolling short positions from the previous series. However, with the index breaching above the 17,200 mark at the start of this series, traders started covering their short positions. As the month progressed, the market showed strength with buying appearing in the broader markets. He added, “We witnessed covering short positions in addition to a new long build-up, which led to a continuous move, and the index is now a kiss away from regaining the 18,000 mark.”

With the long weekend approaching (markets closed on May 1), analysts are not ruling out profit taking in the second half of Friday.