See 4800 support breaking today

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Udayan Mukherjee, Managing Editor, CNBC-TV18, says global cues are bad today. "It was a nightmarish kind of evening for global markets. Europe sold off, the US sold off, and Asia is selling off this morning. Which means the support of 4,800 which the Nifty has been clinging on to for the last couple of weeks gets violated this morning." He says the big question is whether the Nifty will be able to pullback today.

Here is a verbatim transcript of Udayan Mukherjee's comments on CNBC-TV18. Also see the accompanying video.

On markets today

It is not a good morning like yesterday was not for our markets. It was a pretty bad session, in fact nightmarish kind of evening for global markets. Europe sold off, the US sold off and Asia is selling off this morning, which probably means the support of 4,800, which the Nifty has been clinging on to for the last couple of weeks, gets violated this morning.

Whether we can pullback above that is the moot point. But global headwinds are building up there is no denying that and there is little bit of sovereign scare, which is doing the rounds across global markets. It is little bit of a panic kind of situation as we head into Friday trade.

On global markets

 The way Europe sold off yesterday was a clear indicator that there is an element of panic in global markets once again. These things are difficult to track because not all of us understand these issues very clearly. One can sense that there is some risk aversion in the system and that is the key thing. more than Portugal or Greece, I think what has happened over the last few days is that there is risk aversion, which is coming back. People are beginning to feel skittish about emerging markets and generally risky assets once again because of the headwinds, which are building up. That is clearly reflected in the dollar appreciating.

The Dollar Index is above 80 once again and you can see that that is putting a lot of pressure on commodities and emerging market equities. We are not in a great environment for global assets right now. I cannot claim to understand what is going on with the credit default spreads is many of those European nations but we can see that there is evidence that there are outflows across many markets and that is something we will have to live with as well.

On today's trade

Over the last couple of weeks every time you have come to this zone of just under 4,800 the market has been able to bounceback. But will it be able to bounce back in this environment that we are trading in and if it doesn't, then where does the market eventually settle? These are important questions.
ordinarily you would have said that and it may still turnout to be the truth that any dip to the 200-day moving average roughly of around 4,600 if the Nifty goes close to that could have been a buying opportunity but these are difficult things to game because we don't know what is going on in the global environment and how it will pan out.

So taking a firm call could be froth with a bit of uncertainty and danger. So I think the conviction levels are a bit low because this is something which is beyond us. It is not the monetary policy, its not earnings disappointment from L&T those are far easier to map, this is something which is beyond our grasp and therefore tough to game.