'Sensex may regain 19,500 mark'

The BSE building in Mumbai.

Crisis in Ireland and South Korea and a string of scams, including 2G spectrum row and housing loan racket, has seen the Sensex plummeting by 4.11 per cent or 820 points to settle at 19,136.61,in just four trading sessions, triggered by the massive sell-off in the banking and realty counters.

“Sensex is likely to rebound and touch the 19,500-level in the coming week, primarily on the back of value buying in banking and metal counters which were hammered badly last week,” Geojit BNP Paribas Financial Services AVP Gaurang Shah said.

Analysts also feel that heavy selling in the last week was an over-reaction to the continuous negative news flow, as the market fundamentals are strong and India’s long term growth story is intact. “It was a terrible week for the market due to the sharp sell-off in the wake of the ongoing investigations in the housing loan scam, which is just an over-reaction and market is bound to bounce back as the fundamentals are strong,” CNI Research CMD Kishore P Ostwal said.

Besides, market can also get support from fresh investments, as the domestic institutions and new foreign institutions may enter the market, trying to catch the bottom, said an expert. However, analysts also cautioned that global markets and developments in the housing loan scam will primarily decide the fate of stock markets in the coming week.
“Market may remain choppy in the coming week, as the investors have turned jittery on the continuous negative news flow.

Investors need to keep a close watch on the global cues and the developments back home before parking their money in the market,” SMC Captials equity head Jagannadham Thunuguntla said.

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