What is your outlook for the stock markets on 14th October? Do you see weekend correction ahead of the long weekend?

On Wednesday, the Nifty decisively closed above the psychological levels at 18,161 levels. The rally was triggered by Tata Motors which gained over 21% in a single day and over 60% in one week. Among the other gainers were consumer names like Tata Consumer and ITC as most of the frontline sectors are playing catch up.

On Wednesday, the A/D ratio was decisively in favour of the gainers at 34:15. The VIX continues to be subdued at around 16 levels. The results of Infosys were robust and they even upped their revenue growth guidance to nearly 17.5%. Overall technology OPM has been steady with Infosys further closing the gap with TCS in OPM terms.

Foreign investors bought Rs.937 crore of equities while domestic funds sold Rs.432 crore on Wednesday. The flows were positive after a fairly long gap. In global cues, while the Dow was lower by 55 bps, the NASDAQ closed 75 bps higher and all European markets were in the green. The SGX Nifty is nearly 50 bps higher early trades.

It looks unlikely that we could see any sharp correction due to the long weekend. The rally appears to be quite decisive with sector ensuring that any one sector does not get too heated up. We still have the BFSI space to participate in the rally in a big way, so it does look like the Nifty still has legs to go up further.