See Nifty in 5050-5500 range ahead: Prabhudas Lilladher

In an interview to CNBC-TV18, Amisha Vora of Prabhudas Lilladher says, the Nifty will trade in 5,050-5,500 range for some more time. She doesn't expect 5,050 to break.

Also read: Opt for strong bottom fishing post GAAR clarity, says PN Vijay

Below is the edited transcript of her interview on CNBC-TV18. Also watch the accompanying video.

Q: What's happening, what's soured the mood so much? After all we thought the markets would hold out atleast till May 7 and 8, when we would get some clarity in taxes.

A: Both the things are weighing very negatively on the market mood. From the risk on trade perspective, with which we started the year in January and February and so a good amount of FII inflow, we are closer to risk off trade where by not only from India, but from the region also the money flow has been reducing. Particularly in India because of the GAAR and other relevant issues, related issues the money flow has been extremely weak.

I think something, which really added to all this, is more about the way rupee has also started sliding. That is more on the back of the oil import and the requirement of currency because of that by oil companies and once again aided by the low FII and FDI inflow. So, I think it’s gone into a slightly vicious cycle currently.

Q: What are you working with internally at Prabhudas Lilladher? Now that the 100 and 200-DMAs are broken, are you’ll telling your customers to lay off, to come in and buy or are you telling your traders to short more?

A: We think that for the markets for some more time 5,050-5,450 to 5,500 would be the range. Somehow we feel that 5050 kind of range as a first fall will be respected. With this kind of risk off trade, which has been probably happening, oil also is showing some signs of cooling down. That probably will act as a final buffer for the fall that we are seeing currently.

We are not in a hurry. But ofcourse on selective basis, we are very stock specific. But we think that market should stop (falling) somewhere in the range of 5,050 or so. I think a lot of hopes still is build that there will be some revision in GAAR.

Q: Today appears to be a very India specific underperformance compared to the rest of the globe. What is the flows picture, where are you seeing sell orders, if any? Currently, what is happening on the sales desk?

A: Today and yesterday, some ETF or DMA orders were there. Of which while we speak across the dealing fraternity, very specific stock specific sale orders are very limited. But one can make out from the way it has been sold Bankex and Nifty have a basket selling kind of a situation. Unfortunately, even at this time probably the domestic is not lending a very good or strong support in terms of buying.

Q: Now that we have already broken these critical day moving average which a lot of algorithmic trading perhaps all these people look at, do you expect more ETF selling to come for the Indian markets?

A: Yes, ofcourse. With this particular technical level along with the fact that rupee is also not favouring the trade, I think that is a possibility.