Market indecisive, see Nifty in 5000-5400 range: Experts

But the policy had little effect on the market. The Nifty recovered in mid trade to take hold of the 5,200 level.

The Sensex rose 92.50 points to close at 17,236.18 and the Nifty gained 29.20 points and ended at 5,229.

In an interview to CNBC-TV, UR Bhat, managing director of Dalton Capital Advisors says, he sees the Nifty in 5,000-5,400 range. "If there is an LTRO III or something like that, I think 5,400 is a possibility. But if there is a disappointment on the LTRO front or on the QE3 front, I think 5,000 might be at risk," he adds.

Meanwhile, Sudarshan Sukhani, s2analytics.com says, the market is not giving a clear direction. “It is making lower highs, it is not exactly bullish,” he adds.

Below is the edited transcript of UR Bhat's interview on CNBC-TV18.

Q: What has your reaction been to the no policy this time? How do you think the market would move from here?

A: As far as the policy is concerned, the RBI has virtually lobbed the ball back to the court of the government, saying that ‘whatever monetary action could be taken, has already been taken, infact front loaded in April itself, now nothing much can be done from our side, it’s your time and you have to do whatever it takes to control inflation, accelerate growth.’ So, that’s what they have said.

The cut in SLR is not a very big event because the SLR holding of the banking system is higher than the 24-25% that was there. But the fact is that just because banks were not able to lend money, they are keeping in SLR security. So, therefore, as long as there is not really much of growth and better demand for credit, it is unlikely that this cut in SLR will translate itself into reduced interest rates or more money being available for funding corporate expansion plans.

Q: Where does the market go from here? In the last couple of days, we have seen a lot of money coming in from the global guys. Do you think the ECB will deliver on that promise?

A: There is a widespread expectation though. Germany, France and the ECB president have said that they will do whatever it takes to keep the Euro in place. So, therefore, that is extrapolated to say that there is one more LTRO in offing. I don’t know whether it is as simple as that, but I think the expectations are ruling very high. That is why money has already started coming into the Indian market.

Even in the US, there is a similar expectation, sometime over the next few weeks, that there will be a one last hurrah of a QE3 or a something like that. I think these are the expectations that are being built up. I feel that there is an election coming in the US, so it is likely that they will do whatever it takes to ensure that the consumer sentiment gets better.

Even in the Europe, with those statements, I think there is some amount of stability that we are seeing in the Italian and Spanish bond market. So, I think there is a lot of expectation. So, there is always a risk that when the expectations run much higher than what could potentially happen. There is always a risk that there will be correction, if the expected event doesn’t happen. That risk is still there. But to think of a potential LTRO III very soon is asking for a bit too much.