Market will remain in tight range, but there's hope now

Moneycontrol Bureau

A weak opening and a sluggish first half but the markets picked up steam in the second half of the day in line with European markets.
The recovery led the Nifty up all the way to 4733 up 40 points at close, while the Sensex too shut in the green at 15,813, up 128 points. 
However, experts remain cautious on the recovery. Analysts believe that the coming year will have its own share of volatility.
The markets are seeing some sort of a short covering oriented technical bounce back, feels Nitin Raheja, CIO, Rada Advisors. "This will probably take the market up, little higher in the medium term by maybe a couple of percentage points," he said.
But These sort of swift intraday moves are expected as the market turns swallower. And short covering is a very skittish trade. There are likely more stock-specific shorts in the system, so more than a Nifty Call, every 5% move in some of these beaten down banks, infra names for the moment is eliciting some more kind of short covering.
But 4700 was the level, which took a long while to break, and therefore, it is difficult to get too bullish or excited on the way up at this small move.
The trading range is certainly staying within 4500-4900 as of now, believes Deven Choksey, MD, KR Choksey Shares and Securities.
And for it to overcome 4900, we really require some very positive news, one of which, as Choksey pointed out, came up this afternoon as a proposal to put across a bill to reduce the fiscal deficit of the government by floating a separate company to raise funds for acquiring shares of the government-owned companies.
"Some of this kind of positive news could definitely result into a kind of a better confidence into the market and that could lead to an upside going forward," he said adding, "