No cause of concern if market stays above 200-DMA: Experts

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No cause of concern if market stays above 200-DMA: Experts

The next support to look at, Devangshu Datta, consulting editor of Outlook believes, is about 5225 or so.

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Excerpts from Closing Bell on CNBC-TV18 Watch the full show » ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets

Traders on Dalal Street hit reverse gear today. The markets didn't lose too much ground but did a U-turn after touching the 5,400 mark in early trade.  The Nifty lost 26 points and shut shop at 5,335, while the Sensex too closed in the red falling 85 points.

The next support to look at, Devangshu Datta, consulting editor of Outlook believes, is about 5225 or so.

"That would be the 200-day moving average. If it stays above that 200-DMA, then there is no real cause for immediate concern. Looking forward, there is a lot of global macro economic imponderables and you have a lot of people starting to punt on the Budget right now. So, if Pranab Mukherjee talks the market up, that will be one thing," he said.

Aviation stocks flew high today, as the Group of Ministers allowed Indian carriers to directly import jet fuel. However, industry sources say only arrangements with oil companies will make the route feasible.

Must read: Why Jet Air, KFA are not so happy with direct ATF import

Meanwhile, the Central Statistical Organisation estimates that the Indian economy will grow only 6.9% this fiscal-manufacturing, mining and farming sectors will be the big drag

In an interview with CNBC-TV18, Rajen Shah, CIO of Angel Broking and Nischal Maheshwari of Edelweiss, spoke about their reading of the market situation and the road ahead. 

Below is an edited transcript of their interview on CNBC-TV18. Also watch the attached videos. 

Q: What is the call now? You think this market is going to sort of hold it's breath after the huge rally that we have seen?

Maheshwari: Yes. It sort of seems like. It's been a phenomenal rally. The surprising part is most of the investors are reluctant to believe this rally, which is largely liquidity-driven. So, a lot of investors are still sitting on a pile of cash. So that is what's going to continue to drive this rally up. Again, I think there would be some issues going ahead, especially on the international front. We have seen oil going up to around USD 115 per barrel plus and Greece is still a sticky issue. So, some of these is going to create a bit of breathers in this liquidity-driven rally.

Q: What are thoughts on the aviation sector and the kind of news flow that that came out of that? We have seen big 14-15% spikes over there, but you think any of that is warranted?

Maheshwari: I think the good part about it is that the demand is still strong on the ground. The kind of growth, which we had seen especially on the number of seats and the yields, has continued to be pretty positive.

The only negative remains to be oil prices and the capacity. I think capacity after Kingfisher has brought it down by around 15-20%, sort of goes out of the system. But definitely still on the front of the fuel prices, I believe this is more sentimental positive than actually showing up in the profits in the next one or two quarters.

Q: Do you think that if we do see a round of profit booking from here, it is sectors like infra that see it first?

Maheshwari: Yes definitely. We have still not seen much changes happening as far as the infrastructure companies and their order books are concerned. What is going to be the most positive thing happening for them is going to be the interest rate cuts, which we believe will start off in next few quarter. So, if that happens, obviously, the profitability is going to improve.

Incrementally though the sentiment is positive. We have not seen any of these companies reporting substantially improved order books, which give you a visibility of a strong top line for the years to come. That's my worry. These stocks have had quite a phenomenal run in the last one month. So, some amount of profit taking definitely happened.

Q: What's your overall view on Bharti ?

Maheshwari: I think a couple of things are going to be positive for Bharti. Since you have rupee coming back, the appreciation in rupee actually, that's going to be one of the positives where mark-to-market losses from its currency front is not going to be. Rather there's going to be some write backs on that. Secondly, we believe that the margins are going to be positive. Both these things basically and given the outlook that you have after the cancelation of licenses that completion goes down.

These are all positives for Bharti. Within the sector, this is one the best placed stocks and I believe a consolidation is already on the way. This is a good sector to be in.