Sensex, Nifty still in green; Wipro, Bharti, Cipla gain 1%

Moneycontrol Bureau1:45 pm Market outlook: India's benchmark BSE Sensex index of leading shares will gain nearly 3 percent by the end of this year, with a strong likelihood of hitting a new record high next year, according to analysts polled by Reuters.

Indian shares fell over 400 points last week amid rising tensions between India and Pakistan, the biggest fall since Britain's vote in June to leave the European Union briefly drove investors out of emerging markets.

Still, the government's recent Goods and Services Tax bill and a stable economic and inflation outlook after good monsoon rains have driven expectations that India's equity market will attract foreign investment over the coming year.

The BSE Sensex, which is up over 8 percent so far this year, is forecast to rise nearly 3 percent to 29,000 by the end of December from Monday's close, the poll of more than 40 specialists taken in the past week found.

1:30 pm RBI policy expectations: Axis Capital expects domestic indices to be flat till end of December. Meanwhile, the market may be volatile on account of domestic and global cues such as US Federal Reserve's action on interest rates, second-quarter earnings, OPEC decison and the action of RBI's Monetary Policy Committee, said Nandan Chakraborty, Managing Director, Institutional Equity Research at Axis Capital. He said other factors such as assembly polls, especially in Uttar Pradesh, too may have an impact. Irrespective of RBI's decision on interest rates on Tuesday, effective interest rates will fall over the next few months, Chakraborty said. There could be a slight de-rating but index will have an upside of 15 percent on an average, he said.Don't miss: Buy, sell or hold: Best stocks from auto, steel, telecom & oil space

The market is still in green ahead of Reserve Bank of India policy review in a short while. The Sensex is up 45.63 points or 0.2 percent at 28288.92 and the Nifty is up 14.50 points or 0.2 percent at 8752.60. About 1481 shares have advanced, 1164 shares declined, and 126 shares are unchanged.

GAIL, ONGC, Wipro, Bharti Airtel and Cipla are top gainers while Coal India, L&T, M&M, Axis Bank and HUL are losers in the Sensex.

The Nifty could gain another 50-70 points but there is likely to be strong resistance at 8,800 level, says Sanjiv Bhasin, Executive VP - Markets and Corporate Affairs at IIFL.

He feels fund flows may stay muted till there is certainty on geopolitical problems and clarity on issues in European banking space and bond yields.

Earnings will now start off and how it pans out will be more important than the actual Nifty levels, he says in an interview to CNBC-TV18. However, for the next few days to a week he sees Nifty trading in the 8,500-8,800 range.