It's a start of a really important week for our markets. There are lot of triggers staked up for the markets this week, monetary policy and a very important one tomorrow is the F&O settlement for the month of July on Thursday. We have got a week packed with earnings from a lot of critical sectors.

The markets will try and react to the unfortunate blasts over the weekend. So, there is so much to price in as we head into the next five days of trade.

May not be unfair to almost call it a make or break run for the next five days?

It is particularly  because of what happened last week, when we saw the massive pullback and then the last part of the week was not that good and so we are in the grey zone right now, no man’s land where every trader is trying to figure out whether the market is trying to put 3,800 as a base and has succeeded in moving up into an intermediate upmove but the reversals of the last couple of days coupled with all that has happened probably the questions are beginning to be asked on whether that rally has not fizzle out yet.

The answers are not out yet but I think over the next couple of days also depending on how the news flow pans out one will get a sense whether this intermediate uptrend can last a bit longer than people believe or has the first signs of tiring out has happened on Friday and that will continue as we go forward.

It is difficult to game, this is a big week, there are lots of triggers and hopefully the incidence of last the weekend will not spill over to this week as well and that is the lingering fear on sentiment this morning as well.

Asian Indices:

No great cues from the US markets and Asia is pretty mixed and quiet this morning. China is the one which has got up about 1.5%, other markets are just either up 0.25% or down 0.25% no great cues coming in from Asia this morning for us.

Impact of  Ahmedabad and Bangalore blasts on the markets:

Unfortunate that those incidences are, I think the material impact on the markets might not be too much of course those events are a tragedy in themselves but if one looks at the narrow perspective of the market; I do not think there will be any big reaction because the markets have changed over the years. Maybe four-five years back if one had something like a blast happening almost inevitably there would be a sharp knee jerk reaction which would take the markets down. Nowadays, I find the markets are far more resilient to that. I think people remember the recent histories of the last couple of incidents which were far bigger in magnitude than what has happened over the weekend and the markets dealt with them fairly well.

I think the markets ability to absorb news which does not directly affect financial markets and companies directly has evolved over the year and now we are in a far better situation. So those events are very sad and unfortunate but will they peg the market back significantly this morning? I doubt it. The only lingering fear is it’s happened in two major cities and the market would fear if something else happens or something more were to happen then it might affect sentiment quite a bit because its one thing to say okay those are isolated incidences which happened over the weekend, they are not indicative of much more to come over the next few days and as long as that is the belief in the market, I do not think there would be any kind of major price reaction.

It could happen for a minute or two but it’s unlikely that despite sentiment being a bit edgy because of it and will get edgier if there are more such incidence heaven forbid that we do not see such more incidents in the coming week. But if they do not happen I suspect the market will be able to move on; at best a bit of edgy sentiment but no more than that.

I have heard people saying gap-down etc on Monday morning but I would be surprised if that happens.       

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