Market on nervous note: Is there room for a bounce-back?

Indian equity benchmarks closed at a one-month low in the first trading session of May. Rate sensitives like financial and auto stocks got hammered ahead of the credit policy tomorrow, dragging the frontline indices deep into the red.

Bankers expect 25-bps hike tomorrow. Will RBI comply? The 50-share NSE Nifty touched the 5700 mark in an intra-day trade, before closing at 5,701.30, down 48.2 points or 0.84%. The 30-share BSE Sensex too ended below the 19,000 mark - an important psychological level, before ending at 18,998.02, down 137.94 points or 0.72%. According to SEBI, local funds were net buyers of Rs 1301 crore so far in 2011 while they sold Rs 193.2 crore in April alone. So, is there room for a bounce-back? Rahul Mohindar, viratechindia.com thinks that market is likely to see some weakness. However, PN Vijay, Portfolio Manager, www.askpnvijay.com feels that though mounted by pressures market will hold on 5700 which is acting as a support. Vijay says that the real economy is doing extremely well riding on strong PMI and export data. According to Vijay, market is currently oversold.